Do I Need a DBA?
Tuesday, 6 September 2016
by Erin McAllister, Paralegal
Naming your business is an important branding exercise. If you choose to name your business anything other than your personal name, then you need to register it with the appropriate legal authorities. The easiest and most efficient way is to file a DBA. DBA stands for “doing business as”. Certain states and jurisdictions use the terms “fictitious business name”, “trade name” or “assumed name”. DBA registration is necessary if your business operates under a name other than its legal name. All types of businesses can use a DBA – sole proprietorship, LLCs, corporations, or partnerships. The most common reasons for using a DBA are:
1. Many businesses that are starting up are concerned about costs. The DBA filing is inexpensive and you don’t have to keep ongoing bookkeeping records and other formalities of maintaining a business right away. You can grow your business until it is running profitably and then convert it to a corporation, LLC, or other business entity.
2. Name recognition is crucial to a company’s success. Many business owners choose a different name for their business for name recognition and branding. A business name should be used in transactions including sales, marketing, advertising, and collecting monies. Some businesses want to use their business name to identify goods sold or services provided. Other businesses may also have business interests that are completely unrelated and want to separate them in the public eye by using different brand names.
3. DBAs can open bank accounts, write checks and enter into contracts. There are penalties and fines if you start doing business under a different name without creating some type of business registration. An attorney can explain the process and the benefits of registering your business.
4. If you are an existing corporation or LLC and you want to do business under a different name, you should consider registering a DBA.
In most states, you must file your DBA before using your DBA in the operation of your business. This is to make sure the public is informed of your business’ existence. An attorney can help you determine what entity is right for your business and the most cost effective way to organize it.
There are some disadvantages to a DBA including no liability protection. You could be personally liable for the debts of your business. Also, you may not have exclusive rights to your business name. Contact one of our attorneys to answer any questions you may have about DBAs.
This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.
1. Many businesses that are starting up are concerned about costs. The DBA filing is inexpensive and you don’t have to keep ongoing bookkeeping records and other formalities of maintaining a business right away. You can grow your business until it is running profitably and then convert it to a corporation, LLC, or other business entity.
2. Name recognition is crucial to a company’s success. Many business owners choose a different name for their business for name recognition and branding. A business name should be used in transactions including sales, marketing, advertising, and collecting monies. Some businesses want to use their business name to identify goods sold or services provided. Other businesses may also have business interests that are completely unrelated and want to separate them in the public eye by using different brand names.
3. DBAs can open bank accounts, write checks and enter into contracts. There are penalties and fines if you start doing business under a different name without creating some type of business registration. An attorney can explain the process and the benefits of registering your business.
4. If you are an existing corporation or LLC and you want to do business under a different name, you should consider registering a DBA.
In most states, you must file your DBA before using your DBA in the operation of your business. This is to make sure the public is informed of your business’ existence. An attorney can help you determine what entity is right for your business and the most cost effective way to organize it.
There are some disadvantages to a DBA including no liability protection. You could be personally liable for the debts of your business. Also, you may not have exclusive rights to your business name. Contact one of our attorneys to answer any questions you may have about DBAs.
This information is made available by Spaulding Law for educational purposes only and not to provide legal advice. By using this website, you understand that there is no attorney-client relationship between you and Spaulding Law, unless you have entered into a separate representation agreement. This information should not be used as a substitute for competent legal advice from a licensed professional attorney.
