Once you’ve decided to start a business and have chosen a business legal structure, it’s time to figure out how to present your business to the public. Choosing a “doing business as” name, or DBA, is one of the first steps you’ll take when establishing your business, and it’s also a good branding move.
Some people choose to use their own name for their business. In fact, sole proprietors are legally required to use their name as their business’s legal name. However, if you want to give your business a unique name – without registering as a corporation – you’ll need to register your alternative business name with the right people. We’ll explain the process of filing a DBA and what this means for your company.
Your DBA is the name your business is referred to legally and by consumers. A DBA has a few aliases itself: It is also known as a fictitious business name, assumed name or trade name.
A DBA is ideal for sole proprietors who prefer not to use their own names as their company name and entrepreneurs and small business owners who want to select their business name without becoming a corporation.
Having a DBA “means that the person or business entity intends to use that name to identify itself to the public,” said Kimberly Hanlon, attorney at Lucēre Legal LLC. “The legal name remains the person’s name – if an unregistered sole proprietorship – or the business entity – if a corporation or a limited liability company – but the name that the public knows the business as is the DBA name.”
To file a DBA, you must complete specific paperwork and pay a filing fee. You can do all of this with a local or county agency, but some states require you to file with a state agency instead of or in addition to the county. Some states and counties might also require you to publish your DBA filing in a local newspaper, giving the public notice that you have filed a DBA.
For example, in New York, sole proprietorships and general partnerships must file a business certificate listing their assumed names with the county clerk’s office. On the other hand, corporations, limited liability corporations (LLCs), limited partnerships and limited liability partnerships (LLPs) must file assumed names with the New York Department of State. In contrast, Kansas has no requirements for businesses to register fictitious names.
Once you’ve chosen your business’s fictitious name and registered it locally, consider filing for a trademark with the U.S. Patent and Trademark Office to protect your intellectual property. Registering a business trademark protects any words, names, symbols, sounds or colors that distinguish your goods and services.
If the paperwork and filing process seems overwhelming, contact a business lawyer to complete all the necessary filings to secure your DBA name. The American Bar Association lists reputable business lawyers.
If you plan to use a business name different from your given name or business partner’s name, you’ll need to register a DBA. Other reasons for registering a DBA include the following:
The Small Business Administration is an excellent resource if you’re unsure if you must register a DBA.
Here are some crucial facts to note if you’re considering registering a DBA:
DBA filing fees vary. “The fee will vary by state, but it is typically between $5 and $50 – but closer to $20 on average,” Babbitt said, although it can be up to $150 in some states.
Failing to register comes at a greater cost. “While the cost to register is insignificant, the penalties and fees for failing to register can be several thousand dollars,” Babbitt explained. “This is a function of consumer protection. The state wants to know who to contact when a consumer complains. While this is usually handled when obtaining a business license, some states do not require business licenses. Almost every state requires DBAs to be registered.”
While there’s no numerical limit to how many DBAs someone can register, it can get expensive if you register multiple names.
Alabama, Arizona, Nebraska, Oklahoma and Rhode Island are the only states that don’t require everyone operating under a DBA to register. Still, it’s best to check with your state about local requirements.
A DBA can accomplish several things for a business owner.
There are also some less obvious reasons to register more than one DBA. For example, there’s a scene in the TV show Parks and Recreation where Tom and Ben look for a tent for an event. The deal falls through with one tent company, so they call another one, only to find that it’s owned by the same person. In fact, that same person owns all the tent rental companies within a certain-mile radius. Babbitt says this type of thing actually happens.
“Some businesses will create multiple DBAs to create the illusion of competition,” he said. “For instance, four taxis could all have separate DBAs even though they are all owned by the same person.”
You could argue that the cost of filing a DBA is a disadvantage. However, realistically, all growth and structure steps your business takes will cost money. By that logic, the cost of a DBA is barely a disadvantage at all.
There’s also the common mistake of conflating DBAs and business structures such as LLCs. Only the latter provides liability protection if your business faces a lawsuit and shapes how your business earnings are taxed. DBAs also aren’t themselves trademarks.
In other words, DBAs are disadvantageous only if you misunderstand their purpose.
Filing a DBA can give you the branding you’ve long sought, whether you’re a sole proprietor or the owner of a small business. Even in states where DBAs aren’t necessary, filing one can be useful if you’re operating under a different name than your business’s government-facing name. After all, an enticing name can attract more customers – why not make it official?
Max Freedman, Michael Keller and Jennifer Post contributed to the reporting and writing in this article. Some source interviews were conducted for a previous version of this article.