Why You Might Need to Process a Fictitious Name Registration
As a small business owner, it’s important to able to pivot quickly if the marketplace isn’t buying what you sell. That was a lesson I learned immediately after I started my business in 2008. Initially, our business planned to connect small and midsized business owners with companies that wanted to market to them. But did I mention it was 2008? As the economy crashed, big companies cut their budgets and the costly services we’d planned to sell were a no go. We had to start over, including using fictitious name registration to give our business a new name to go with our new focus.
Demand for web content was growing by leaps and bounds in 2008, and since I knew flexibility was key to survival, my partners and I quickly reformulated our game plan to focus on that. Consequently, we needed a new business name—our corporate name simply didn’t make sense for our new angle. However, as a corporation, changing your name is easier said than done. The solution was to complete a fictitious name registration with our new name as the DBA (doing business as) and maintaining our corporate name.
There are four ways or places you can register a business name:
- Entity name. Depending on your business structure and the state your business is located, you may be required you to register a legal entity name. You’ll need to do a business name search to make sure the name isn’t registered by someone else in your state.
- Trademark. A trademark helps protect your business name at a national level. You register your trademark through the United States Patent and Trademark Office or through a service like CorpNet’s trademark search and registration.
- Domain name. In today’s Web-obsessed marketplace, securing your domain name (URL) is absolutely crucial to protect your brand online. Domain names are registered through a registrar service.
- Fictitious Name Registration. Whether or not your business requires a fictitious name registration depends on the type of business structure (sole proprietor, LLC, corporation) and the state your business is filed in. Each type of structure has its own requirements for business licenses, permits, and tax filing, but if you formed as a sole proprietorship or partnership, you must conduct fictitious name registration as part of your business formation regulations.
To DBA or Not to DBA
The purpose for registration is one of transparency—the public (and the government) should know who actually owns the company.
Let’s say your name is Susan Jones and you decide to name your sole proprietorship Tech Ace, which is more descriptive of your business but doesn’t tell the IRS who is actually writing the checks or getting the income. In most states, you’d need to register both your name and your fictitious business name with your Secretary of State office. Although a DBA separates you as a person from your business in the public eye, DBA registration gives you no liability or asset protection if you operate as a sole proprietor or partnership.
Because the requirements vary so much, it’s important to get the right help in registering a fictitious name.
There are currently 13 states that do not have a state filing requirement; however, you may need to register at the city or county level. Those states are Alabama, Alaska, Arizona, Delaware, Florida, Hawaii, Kansas, Maryland, Mississippi, Nebraska, Ohio, Wisconsin, and Wyoming.
For the states that do have state filing requirements, 21 of those states also require fictitious name registration at the county level in addition to the state level. In addition, seven states (California, Florida, Georgia, Illinois, Minnesota, Nebraska, and Pennsylvania) also require the business to publish their fictitious name in a newspaper or legal publication.
Having a DBA can also help you clear up confusion for clients and for your branding.
My business built a reputation by marketing and employing our fictitious name as much as we could. If your business is a corporation or LLC, you can conduct business under a different name from the actual legal name by filing a DBA or several DBAs. Getting a DBA gives a business a lot of flexibility. My business also needed fictitious name registration for our bank accounts so our clients would recognize our invoices and be able to pay us based on the name we used in the marketplace. Plus, the bank requires a DBA registration for the account. If you originally opened the bank account under your sole proprietor name and later formed an LLC or corporation, you’ll need to close the original bank account and open a new account with the LLC or corporation name filed in your state.
How to Complete a Fictitious Name Registration
Before you start operating under your new fictitious name, you will need to conduct a fictitious name search to confirm that no other business in your state has already registered the name. Doing a Web search isn’t enough, since some businesses may not have a website. Alternately, a business may have the domain name, but never register the exact name you desire.
Next, you’ll need to fill out a DBA application with your county clerk’s office or with your state government, depending on your state. (Most likely there are fees involved to submit an application.) A search for the Secretary of State office online can help you find an application or you can have companies like CorpNet file the DBA and do the work for you.
Once your application for a fictitious business name has been approved, you can start using the name right away. If you’ve already started using the name, don’t fret. Some states give you some leeway when it comes to filing an application, but don’t wait too long or you may have some annoying fines to pay. Finally, be sure and check on the renewal deadline for your DBA. Most states require a renewal anywhere from five to 10 years, so you’ll want to make sure you renew on time to protect your rights to your name.