When you form an LLC, you choose a name for it — this is your official business name. There may come a time when you decide that a different name would be more advantageous for branding or marketing purposes. To operate under a different name, you have to register a fictitious business name for your enterprise, also known as “Doing Business As” or a DBA.
In this article article, we’ll explain what a fictitious business name/DBA is, why operating a business under a DBA is beneficial for your business, and four simple steps for adding a DBA to your LLC.
What is a DBA/Fictitious Business Name?
A DBA or fictitious name (also called a trade name) is essentially a pseudonym or nickname for a business. Instead of operating under the full legal name, a business can operate under a different name or an abbreviated name. For example, the legal business name of the company that owns amazon.com is Amazon Technologies, Inc — but the name it uses and advertises is simply, Amazon.
It’s not always necessary to create a DBA, but if you decide to operate your business using anything other than the legally registered name — you must register that name as a DBA with your state. When deciding on using a DBA for your LLC, follow these basic guidelines:
- Create or find a unique name that describes your business.
- Ensure it is easy to remember and pronounce, ideally fewer than five words.
- Ensure the domain name is available if your website will use the DBA name.
Why Would I Operate My LLC as a DBA?
When you formed your LLC, you created a separate legal entity. This protects your personal assets should the business fail. But, what if your LLC's name doesn’t reflect the nature of your business?
For example, you’re starting a garden and nursery business, but you’ve registered your LLC using the names of the business owners, e.g. Smith and Jones, LLC. This name says nothing about the type of business you plan on operating.
In this instance, you might add a DBA to your business name, like “Spring Thing Nursery” to better reflect your business activities. For marketing and advertising purposes you only have to use the DBA, not the name of the LLC. Think Amazon again.
Moreover, using a DBA allows you to create other businesses under one LLC umbrella, to create other vertical markets or businesses targeting different audiences. For example, Smith and Jones, LLC has another garden shop business that only sells cactus and succulents online doing business as “Low2NoH2O.”
What Are the Pros and Cons of Using a DBA?
There are plenty of good reasons to operate your LLC using a DBA, mainly the privacy it provides the business owners. And, unlike legal entity names, states allow multiple businesses to use the same DBA.
For example, a company could use “Acme Trucking, LLC” as their legal entity name, but register their DBA as “Bouquets2U,” which better describes what the trucking business specializes in — flower delivery.
A DBA also provides a layer of privacy for business owners who may not wish to have their name associated with the business publicly. Furthermore, there are no additional taxes levied upon businesses operating under a DBA, and there may be no limits to how many DBAs you can operate under one LLC umbrella — check with your state or locale.
The main downside to using a DBA is there are no exclusive rights to the name unless you trademark it. Some people mistakenly think a DBA has its own, separate benefits and protections, but it is just a name — not an independent legal entity. Meaning, you should register your business entity as an LLC, then add your DBA to it and trademark both if you want exclusive rights to those names.
How Do I Add a DBA to My LLC?
There are rules in place to ensure businesses aren’t just making up names and engaging in fraud. Obtaining a DBA usually involves filing your fictitious business name with the state and/or county where you operate. Here are four steps to registering your LLC’s fictitious business name.
Step 1: Select Your Fictitious Business Name. Choose a DBA (or several) that will help describe your business, promote your brand, and create interest in the marketplace. Make sure your chosen DBA reflects the kind of business that you do. You may need more than one because another business might already have a business registered under the same name.
Step 2: Perform a Name Search. Next, you’ll need to see if the DBA you’ve chosen is available. Search online with the secretary of state or at your local registry. Your proposed DBA name must be unique. If there are no matches, you can use that DBA.
Step 3: Complete the DBA Form. Once you have the name right, you’ll need to file your DBA registration form with the secretary of state’s office. Most states provide the form online through the secretary of state’s business website; however, you may also request it from their clerk’s office.
To complete the process you’ll provide the legal name of your LLC, along with some personal information including your personal address, full names of the owner(s), and the address or business location where your LLC operates. Here’s what this form might look like in your state.
Step 4: File Your DBA Registration. Once you’ve completed the previous three steps, you’re ready to file your registration with the appropriate state agency — in person, or online, and pay your fees (which vary by state). Once received, it will only take a matter of days to add the DBA to your LLC.
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