- Personal liability protection
- Taxed at corporate and individual level
- Formal meetings and record-keeping required
- Same liability protection as a corporation
- No corporate tax, profits passed directly to owners
- Fewer corporate formalities required
- Not a formal business structure
- Required to legally conduct business under a trade name
- Minimal maintenance required
A DBA, “doing business as” is a means by which you let the county know what your business name is and who owns the business. A DBA registration is required when the business name is not the same as the individual owner’s personal name.
Filing a business name as a DBA with the county does let other business owners know the business name is taken in the county the name is registered. It helps prevent confusion in that typically a business owner looking to file a business name will choose a unique name to stand out from its competitors. It makes no sense to have the same name as another business as this can confuse customers. A client may end up contacting a competitor with the same name in error. Keep in mind a DBA will not prevent another business owner from filing the same name as a corporation or LLC. For example, Branches and Bushes Landscaping can be filed as a DBA. However, another business in the same county could register as Branches and Bushes Landscaping Inc. or Branches and Buses Landscaping LLC. A DBA does not protect the business from a registered corporation using the same name. Typically however, this is not done to avoid confusion.
Law Suit Protection
A business owner with a common name such as Bob Smith, would do well to register as a DBA. This will prevent Bob Smith that owns Branches and Bushes Landscaping from being confused with the Bob Smith that runs a plumbing company. However, the reason the county requires registration of a DBA is to aid in identifying the individual that owns a business. Therefore, someone who is trying to determine who owns Branches and Bushes Landscaping can check the name on county filings to see the individual owner’s name.
How to Protect a DBA Name
For those wishing to protect their business name and prevent another business from adopting the name, the best strategy is to trademark the name. A trademark is a legal entity that prevents another business from using that name. And, should another business try to use the trademarked name, the owner of the trademarked business name can sue to prevent the new business from assuming the name. This process is be costly and is best pursued using a lawyer that specializes in the trademark process.
While a DBA does not afford legal protection or legal rights to a particular business name, it does let other business owners know the particular name is already in use. A smart business owner is not going to adopt a name identical to another business. A poor business reputation belonging to the original business name could carry over to the copycat. Or a lawsuit directed toward a particular name could in error be filed against the duplicate name.
Whether you’re a corporation, LLC or sole proprietor, there may be advantages to filing a “Doing Business As” or “DBA” for your business.
What is a DBA?
DBA stands for “doing business as” and is an official and public registration of a business name. DBAs are also known as Fictitious Names, Fictitious Business Names, Assumed Names, and Trade Names. Essentially, a DBA is the name of a business other than the owner’s name or, in the case of a corporation, a name that is different from the corporate name as on file with the Secretary of State.
What are the benefits to filing a DBA?
A DBA makes it easy to:
• Open a bank account and collect checks and payments under your business name
• Look more professional, by establishing a separate business identity
• Start marketing and advertising under a name other than your personal or corporate name
What is an example of a DBA and how it is used?
If you were a sole proprietor named Jane Brown and the name of your business was “Donuts Unlimited,” you would register your business as Jane Brown, doing business as “Donuts Unlimited.”
I’ve already got a name for my corporation or LLC. Do I need a DBA?
If you have a corporation or LLC and want to do business under a name different from your corporate name, most states require that you file a “Doing Business As” name or “DBA.”
For example, if an LLC is doing business under the name “Studio City,” but the corporate name is “Pinnacle Projects, LLC,” then a DBA should be filed for the name “Studio City.” This DBA filing must be made in the county or state (where applicable) in which the registered office and principal address of the business are located.
What information is required for a DBA filing?
DBA filings will typically contain the name of the applicant, date of filing, name of the fictitious business and address for the business. Filings can be made by individuals or businesses. In most states, you must first file the DBA documents with the appropriate government entity, accompanied by a state or county fee. In some states, you also have to publish the name in a newspaper to give notice of the new business name.
There is no perfect formula for picking a great business name. The best name depends on a number of factors and things to take into consideration. Some things to consider are: what kind of business you do, others can simply be your lineage (family name) or unique as your own tastes / style. There are, however, a few guidelines that will steer you in the right direction. A appropriate business name should: be distinctive, memorable, easily spelled and pronounced, suggest the products or services you offer, and most importantly distinguish you from your competitors.
Cannot play this video?
When starting any new business, the owner needs to go to the county offices and file for a fictitious business name – or you can go to LegalZoom and file a DBA in less than 10 minutes! Get tips for choosing a business name with advice from a college business instructor in this free video on business planning.