This month in our FAQ series, we tackle the most commonly asked questions about one of the most popular entity types – the DBA.
Starting a business can be overwhelming, and one of the first and most important steps is choosing a business entity. A DBA, which stands for “Doing Business As”, is also known as a fictitious business name or assumed business name. A sole proprietor can file a DBA in order to operate under their preferred business name, or a DBA can be filed underneath an existing corporation or LLC in order to advertise as or accept payments under an alternative name. Below are some of the most common questions and answers our CEO Nellie Akalp receives regarding the DBA:
Q: If I’m a sole proprietor, do I need to file a DBA?
A: It depends. If you are operating your business as a sole proprietor, you’ll need to file a DBA to operate your business with a name that’s different than your own personal legal name or last name. For example, if you want to start a gardening business with the name “Spring Flowers Landscaping” then you’ll need to file a DBA to be able to use that name.
But if you’re a sole proprietor and are going to use your own personal legal name or last name for your business, then a DBA isn’t necessary. In addition, you don’t need to file a DBA to use a business name that includes your surname and a combination of words that accurately describes your business. For example, if your name is Jane Doe and you have a landscaping business, you do not need a DBA to call your business “Doe’s Landscaping.”
Q: If my business is structured as an LLC or Corporation, do I need a DBA?
A: If you filed to become a corporation or LLC, then you’ve already registered your business name with the state and don’t need a DBA to use the official name on the filing paperwork. However, you do need to file a DBA to use any variations from the official name on your LLC/incorporation paperwork.
Q: When do I need to file my DBA?
A: You shouldn’t conduct any business under a fictitious business name until filing a DBA for that name. Most banks typically won’t let you open a business bank account (and accept checks to your fictitious business name) until you have filed for a DBA.
Q: Is there a difference “fictitious business name” and Doing Business As (DBA)?
A: No. Fictitious business name, DBA, and assumed business name all mean the same thing.
Q: If I file for a DBA, does this prevent others from using my business name?
A: No. In most states, a DBA doesn’t guarantee exclusive rights to a name. When you file for an LLC or corporation, this can give you exclusive rights in your own state. You can also file for a trademark to guarantee exclusive rights to the name within your line of business in all 50 states.
Do you need help filing a DBA or have a question about another aspect of starting a business? Call the CorpNet.com team today for a free business consultation at: 888.449.2638
What’s in a name? More than you might realize when it comes to choosing one for your business!
Aside from the obvious must haves of grabbing customers’ attention and being memorable, a business name must also be available to use—and protected.
Selecting a name for your company is only the first step in the process. You also have to determine that no one else is already using the name by performing a name search. Then register your business name, so you can legally use it and so other businesses don’t try to claim it as their own.
Imagine if you’re operating under the business name of “Sylvia’s Salon” and someone a few blocks away opens its doors as “Sylvia’s Salon.” That would confuse customers. It could also end up hurting your reputation if someone were to write a bad review of your company when they were actually referring to an experience they had at the other Sylvia’s Salon.
Three Options For Registering Your Business Name
How you register your business name will largely depend on your business’s legal structure.
1. Securing Your Business Name By Forming an LLC, S-Corporation, or C-Corporation
When creating a formal business structure for your company, you take care of your business name registration in the process. And by forming an LLC or registering as an S-Corporation or C-Corporation, you also gain certain liability protection and potential tax benefits.
Submitting articles of incorporation or articles of organization (sometimes called “certificate of organization”) to your state automatically registers your business name within that state. Prior to approving your name, a search is done to ensure it’s not already being used by another business in the state.
2. File A Fictitious Business Name
If you’re a sole proprietor, you can very simply claim and protect your name by registering a fictitious business name with your state or the city/county clerk. This is known as filing a DBA (Doing Business As).
The fee for filing a DBA is typically nominal. So you’re sure no one else has rights to the name, you’ll want to do a name search before filing. Many banks require a DBA before they’ll open a business bank account for an entrepreneur. Depending on the state you’re registering in, you might also be required to publish a notice in a local newspaper and/or a local legal publication to inform the community that you’ve filed your business name.
If you’re using a business name that includes both your first and last name (such as Sylvia Benton’s Salon), you can use the name without filing a DBA. Other names need to be filed as DBAs.
3. Trademark Your Name
Registering your business name as a trademark (or service mark if you sell services) provides the most protection against the threat of others using your name to sell similar products and services. Federal trademark registration will safeguard your name nationally rather than only within your state.
To register for a federal trademark, you must submit an application to the United States Patent and Trademark Office and pay the applicable fee. As with the other options for registering your business name, make sure you do a trademark search before filing to verify your name isn’t already in use.
Your business name is far more than “just a name.” It lays the foundation for your company’s identity and professional reputation. As with any registration or filing that has legal ramifications, you’ll want to cross all your t’s and dot all your i’s when registering your business name.
Not sure of the process or don’t have the time to take care of it on your own? Save yourself the hassle! Contact CorpNet today for a free business consultation and we can help you register your business name!
Image: Adobe Stock
I’m always in awe of the many talents of today’s entrepreneur…the wedding photographer who also writes children’s books, the copy editor who sells homemade soap, and the stay-at-home mom who doubles as a part-time caterer and jewelry designer. Today’s creative professionals often find themselves making income through a creative patchwork of diverse interests and talents.
Take Sue as an example. She recently called into the office with no fewer than five ventures. She has been selling children’s clothing, handbags, and craft supplies on Etsy. After a few solid years on Etsy, Sue was now ready to take the next step and launch her own websites outside of Etsy, as well as expand into handmade paper goods and home décor. Continue reading “Multiple Ventures? How to Best Structure your Multi-Brand Business” »
The most frequently asked questions AFTER incorporation
Over the course of my career, I’ve helped over hundreds of thousands of small business owners incorporate a business or form and LLC. And certainly there are many questions leading up to the process, such as…what type of business should I form? What’s the difference between a C Corporation and an S Corporation? But I’ve also found there can be just as many questions after incorporating a business or forming an LLC.
I’ve put together some of the more commonly asked questions to help you navigate life after the incorporation or LLC formation process:
I used to be a sole proprietor and I had a Federal Tax ID number. Do I need to get a new Federal Tax ID number now that I’ve incorporated/formed an LLC?
The answer here is yes. An LLC or corporation is its own separate entity (remember an LLC or Corp can sue, be sued, get a loan…) and as such, it needs its own federal tax ID number, also known as an Employer Identification Number (EIN). Think of business formation like the birth of child. Once a child is born, it needs its own social security number. The same holds true for your business. Continue reading “Now that I’ve Incorporated…What’s Next?” »
Nellie Akalp is a savvy entrepreneur, wife, and mother of four (inlcuding a newborn). As the CEO of CorpNet.com, she runs a small business that helps guide entrepreneurs and small business owners through the process of starting a business, incorporating a business, and filing business-critical legal documentation with an easy and cost-effective online service.
“With the downturn in the job market, more people are starting new businesses to take control of their own destiny and create opportunities for themselves,” says Nellie. “But the process of incorporating a business can be intimidating. A lot of people might not understand the legal requirements, or they might wonder, ‘Am I doing this right?’ CorpNet makes it easy. We take it off the ‘to-do list’ of our clients.”
If you want to start and grow a business in a way that complies with state laws and protects your personal assets, CorpNet gives free consultations to help choose the right business structure and file all the necessary paperwork. “You don’t need to hire an attorney to incorporate a business,” says Nellie. “CorpNet gives you a much less expensive way to start your business and comply with the specific requirements of whatever state you’re in.”
Nellie offers these four big reasons to incorporate your business: Continue reading “CorpNet.com: Helping Entrepreneurs Start New Businesses Online!” »
Last September, I turned 40 and in about 2 months i will be celbrating my 41st birthday…which once seemed like a pretty HUGE milestone…now its just another day for me. When I turned 40 and now that I’m about to turn another year older, i don’t get sad about gorowing older, don’t dread it, and I have no attempts to forget the day. I realized I’m not just at peace with myself and my age, but I’m actually happy. And granted I have my health and a fabulous family (including a 9 month old baby girl!), but another key thing is that I absolutely LOVE what I do. And that’s a good thing, because I’ve now done it twice and wanted to share this message with you today…seemed like a great day to share!!!
Let me explain. Shortly after law school, I launched a business with my husband. We provided online legal filing services to entrepreneurs, startups, and small businesses. Basically that means we helped companies incorporate, form LLCs, and start their businesses the right way without having to pay an arm and a leg in attorney fees.
In 2005, we had the good fortune to sell that company to Intuit. We now had plenty of capital. We had the freedom to travel, spend time with our children, and dream up other business ideas. I had a great time during this interim, don’t get me wrong. But, the other ventures just didn’t carry the same spark for me. So, in 2009, we started all over again with CorpNet.com, our latest (and last?) document filing service. And every day since, I’ve been so grateful we made that decision.
First and foremost, I love helping other entrepreneurs. I love the concept of the small business. And I love giving small business owners access to resources they might not be able to afford otherwise. Because every business, no matter how small, should have the right legal protection to help them thrive. Over the course of my career, I’ve helped form more than 100,000 corporations and LLCs across the U.S. Continue reading “Why I LOVE What I Do as CEO/Founder of CorpNet…” »
This is a reprint of a guest post written by me that originally appeared on Mashable last year that I wanted to share it with you today.
Your business begins with a name. It’s the cornerstone of your company identity and impacts your branding, company tone, and first impressions. Think about it. The branding of Target would be very different if the retailer still went by its original name, Dayton Dry Goods Company.
Selecting the right business name for your company is important — and it should be followed by taking the right legal steps to make sure the name is yours to use for years, and decades, to come. A prudent approach to naming entails three important steps: brainstorming, investigation and registration. Continue reading “3 Steps to Creating and Protecting your Business Name” »
You formed your Corporation or LLC, so you’re well on your way to building a successful business. Now it’s time to protect your company name and brand, so that name will be yours to use for years to come. When it comes to your business name and trademarks, a few proactive steps can go a long way toward protecting your brand and business. Best of all, it’s easy and affordable — you just need to know where to start…
First, some basics. A trademark is a word, phrase, symbol or design (or a combination of any of these) that identifies and distinguishes the source of the goods of one party from those of others. Trademarks are managed by the U.S. Patent and Trademark Office (USPTO).
You’re not actually required by law to register a trademark. Use of a name instantly gives you common law rights as an owner, even without formal registration. However, you should consider registering your trademark for proper legal protection — after all, you’ve spent untold hours deliberating on the ideal name, and you’ll be spending even more cultivating brand recognition. Continue reading “Using Trademarks to Protect Your Company Brand” »
During the initial months of the year, savvy entrepreneurs rush to incorporate their businesses or form a Limited Liability Company (LLC). And with good reason, a corporation or LLC is essential to protecting one’s personal assets from any liability of the company. After all, if you’re sued as a sole proprietor or partnership, you’re sued personally – and that puts your personal savings and investments at risk.
Incorporating a business or forming an LLC is a relatively quick and painless process. However, while it may seem straightforward, there are some common mistakes that business owners make that can have a significant impact on their business:
1. Choosing the Wrong Business Entity
Your choice in business entities will shape the amount of taxes you pay and paperwork you contend with. It’s an important decision, one worth some research. The three most common types in the U.S. are the LLC (Limited Liability Company), S Corporation, and C Corporation. Here are a few things to keep in mind:
- The LLC is great for startups that want the liability protection, but prefer minimal formality and paperwork.
- The S Corporation is a pass-through entity for federal taxes (like the LLC). It should be used by startups that will make a profit soon after incorporation…and that profit will be distributed to the shareholders.
- The C Corporation files its own tax report. It should be selected by those startups who plan to reinvest profits back into the company or seek funding from a VC.
2. Incorporating in Delaware or Nevada
Delaware and Nevada are hot states for incorporation, and for good reason. Delaware offers some of the most developed, flexible, and pro-business statutes in the country. And Nevada is increasingly becoming a popular choice for businesses due to its low filing fees, as well as the lack of state corporate income, franchise, and personal income taxes.
However, if your startup has less than five shareholders, it’s best to incorporate in the state where your business has a physical presence (i.e., where you live). Otherwise, you won’t actually reap any of the benefits, and you’ll be dealing with added hassles and costs of operating “out of state” A including: difficulties opening a business bank account, having to appoint a registered agent, and fees for operating as a ‘foreign entity’ in your own state.
You don’t actually need to hire a lawyer to form an LLC or Corporation. If you’ve got a straightforward investment situation, you can use a legal document filing service to represent yourself to create a business entity. In the eyes of the law and IRS, your LLC or Corp will be just as valid than if a high-priced attorney sent in the documents for you.
4. Not Staying Compliant
Too many business owners think that their legal obligations are finished once their LLC or Corporation is formed. But, it’s critical that you keep your LLC or Corporation in compliance. If a plaintiff shows that you have not maintained your LLC/corporation to the letter of the law, he or she can seek recovery against your personal assets. In short, the corporation’s shield that protects your personal assets is pierced.
So, how do you make sure your corporation stays compliant? Keep your personal funds separate from those of the business (no commingling: this means keeping a separate bank account and credit card). Remember to send in your Annual Statement/Annual Report (if required by your state). And obviously, do not engage in any form of fraud.
By avoiding these common missteps, you can better protect your personal assets and minimize your personal liability; Of course, the biggest mistake of all is never forming an LLC or Corporation. So even if you’re putting 80-hour weeks to find new clients or launch a new website, make some time this year to incorporate. By getting your legal ducks in a row early on, you’ll be able to scale far more smoothly in years to come.
CorpNet.com can help right from the beginning, with a Starting a Business Checklist that lists everything you need to know in order to get your company up and running. Our Free Corporate Name Search lets you be sure that the name you’ve chosen for your company is available, and we can help you to reserve the name for your own use. CorpNet.com’s Free Incorporation Guide or Free LLC Guide to get all the details about the distinctions between the two structures. You’ll learn that overall, an LLC is the less formal entity. Of course, details may vary based on your specific circumstances, so take some time to educate yourself on these two business structures.
CorpNet.com can provide filing services in all 50 states. Our staff is professional, courteous and reliable, and all services are fully guaranteed.
Contact CorpNet.com today, and cross all of those business filings right off your list.
We look forward to incorporating your business for you and getting your business off the ground!
A portion of this original content by Nellie Akalp was written and published on StartUpNation.com.
At some point or another in our working lives, the majority of us will sit at home and ponder where everything went quite so wrong. For some, it will be a temporary downer – for others, it’ll be a more persistent, lingering state of mind. So, if you’re feeling overworked and underpaid, why not think about starting your own company?
There’s one really easy way to ensure that you’re valued as a worker, you’re not overworked, and you’re paid fairly – and that’s by being your own boss. The thing about starting a business that most people neglect to recognize however is that success isn’t instant, and big fat pay checks don’t roll in from day one. A successful business takes time to nurture, but if it’s something you enjoy doing, it won’t feel so much like a chore, and more like a pleasure!
Bring overworked and underpaid were just two of the reasons that I decided to call it a day working for someone else. Of course it wasn’t long into my business venture that I realized I had been a little rash, I wasn’t underpaid at all, by any stretch of imagination – and you could almost argue that I wasn’t really overworked (although it felt like it at the time!). I got a real sense of being overworked and underpaid just a few weeks into running my own business – 15 hour days for no wages were the norm.
Luckily, I kept my day job up long enough to subsidize my wages for a good few months after starting my company – but it wasn’t easy. Getting your company into gear can be pretty difficult – so don’t go expecting to draw a wage from the get go. Unless you’ve accrued some savings you can effectively live off whilst your business is in the start up phase, you too may find the only viable solution is to keep up your day job, and moonlight as a business owner. Continue reading “Overworked? Underpaid? Start your own business!” »