In the progression of running your business, you’ve probably encountered more legal fine print and formalities than you ever thought possible.
What Is a DBA?
In the U.S., a DBA lets the public know who the real owner of a corporation is. The DBA is also called a Fictitious Business Name or Assumed Business Name. It got its origin as a form of consumer protection so that dishonest business proprietors can’t try to avoid legal trouble by operating under a different name. When someone files a DBA, it’s normally circulated in some kind of print newspaper. It lets the community know exactly who the people are behind a particular business.
Who Needs a DBA?
In general, there are two reasons why a business in the U.S. will need to get a DBA:
If you are operating your business as a single proprietor, then you’ll need to file for a DBA if your business has a different name than your own name. In some cases, you don’t need a DBA if your business name is a combination of your name and a description of your product or service. For example, if a business was called David Jones Gardening Service, it may not need a DBA. But, if it’s just the first name (aka David’s Gardening Service), then a DBA is required. If that sounds confusing, don’t worry; just touch base with your local clerk’s office and ask them if you’ll need a DBA.
Corporation or LLC
If you have filed to become a corporation or LLC, then you’ve already registered your business name and don’t need a DBA. Although, you will need to get a DBA if you plan on conducting business using a name that’s different than the name filed with your LLC/corporation’s paperwork. So, back to our example, if we incorporated the business as Spring Flowers Gardening, the business will need to file a DBA in order to operate under “SpringFlowersGardening.com” or “Spring Flowers.” In short, you’ll need a DBA to operate with any kind of variation of your original name.
The Importance of a DBA
This might sound like a lot of unnecessary, extraneous paperwork. Yet there actually are a few important reasons to get your DBA in order.
2. For LLCs or corporations, a DBA will let you operate multiple businesses without having to form a separate LLC or corporation for each business. Let’s say your business wants to expand into multiple websites, stores, restaurants, services, etc. You can create a corporation with a comparatively generic name and use a DBA for each individual business. This will cut down on your paperwork and expenses when you’re operating multiple projects.
3. Keeps your business compliant. If your business is an LLC or corporation, you enjoy certain legal protections. But, these protections may be invalidated if you’re operating under a different name and didn’t file for a DBA.
Filing a DBA
The rules, requirements, forms, and fees associated with filing a DBA are different in each state and county. The U.S. SBA provides a chart which details DBA filings state-by-state. By using a legal bookkeeping document filing service, you can make sure that you’re following your county and state requirements perfectly and won’t be unintentionally operating outside of the law.
Filing a DBA name isn’t hard; you just need to work under your state or county’s requirements to go about it in the right way. It’s usually best to get this all done before you operate under your intended “doing business as” name, somewhere between 30 and 60 days before you open your doors.
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