A DBA, which stands for Doing Business As is like giving your business a nickname or an alias. It’s an official way to use a different name for your business than the one you registered with. Having a DBA allows you to be flexible with your business’s name and change it if you want to rebrand or try something new. But there’s more to it than just marketing. Here are some other important things to understand about DBAs.
What Is a DBA?
A DBA is basically a fancy way of saying your business has a nickname that’s officially recognized by the law. It’s not its own separate entity, and it doesn’t change how your business is structured legally. Having a DBA doesn’t give your business any extra protection for assets or liabilities.
Sometimes, depending on your business setup, you might need to get a DBA if you want to use a different name than your own for your business. But it’s not something every business needs to worry about. Before you decide to register a DBA with your local authorities, it’s smart to weigh the pros and cons first.
Advantages of Filing a DBA
When a business has a registered DBA, it’s like having permission to use a different name officially. So, instead of sticking to the name you started with, you can use this new DBA name for things like banking, getting paid, and promoting your business. It just gives you a bit more flexibility and options.
Disadvantages of Filing a DBA
Businesses with DBAs take on the same legal and financial responsibilities tied to the name on their DBA registration. When it comes to tax filings and official stuff, a business using a DBA must stick to its original company name as registered with the state where it started.
You can have several DBA registrations under one company, but all those DBA names are linked back to the main company when it comes to legal or financial stuff, like lawsuits or liabilities.
Do I Need a DBA?
If you’re running a sole proprietorship or partnership and want a business name that’s not just your last name, a DBA is the way to go. Take, for instance, two contractors named Washington & Adams who want to spice things up and call themselves “Founding Fathers Roofing.
Now, for more established setups like corporations or LLCs, DBAs might come into play under different circumstances. These formal business structures can pick a company name right from the start, so they don’t necessarily need a DBA to operate under the original name. When you file as an LLC or corporation, it’s like creating a whole new entity. On the flip side, a DBA just adds another name to an existing business.
When a company wants to shake up its brand or marketing game, getting DBAs can be handy. Let’s say a company wants to switch up the name it uses with customers or tweak its market presence—it’s easier to file for a DBA than to go through the legal hoops of a name change. DBAs also come in handy when a company wants to expand its range of brands or services without setting up new corporate structures.
Sure, a DBA can be a smart move for marketing, especially if your company’s branching out its offerings. But remember, each new DBA means more admin work for your team, and it doesn’t offer the same legal and financial protections you’d get from setting up separate LLCs or corporations.
Who Should Consider Filing for a DBA?
If you’re running a sole proprietorship or partnership and you’re not using your own name for your business, you might need to file a DBA with the state.
For LLCs and corporations looking to mix up their brand game or create distinct brand identities linked to the main company, DBAs can be handy. They’re often much easier than officially changing the corporate name. In lots of states, you’ll need to file a DBA if you’re doing business under a name other than your official one.
Who Should Consider Filing for a DBA?
If you’re running a sole proprietorship or partnership and you’re not using your own name for your business, you might need to file a DBA with the state.
For LLCs and corporations looking to mix up their brand game or create distinct brand identities linked to the main company, DBAs can be handy. They’re often much easier than officially changing the corporate name. In lots of states, you’ll need to file a DBA if you’re doing business under a name other than your official one.
DBA Cost of Registration
The price tag for registering a DBA depends on where you are. In Florida, for instance, it’s going to mean jumping through different hoops and shelling out different fees compared to California. Other things that can change the price are yearly fees and any costs if you want to cancel your DBA.
How Do I Get a DBA?
DBA rules aren’t the same everywhere you go. In some states, you’ll handle your registration with the state agency in charge of business filings, usually the Secretary of State. In other places, it’s a city or county affair. Some states mix it up, with sole proprietors and partnerships dealing locally while LLCs and corporations go through the state. And then there are a handful of states where certain types of businesses don’t even need a DBA.
Usually, getting your DBA filed costs less than $200, but in some states, there might be extra steps, like publishing a notice in a newspaper. Since each state has its own way of doing things, it’s a good idea to hit up the official state websites or give the Secretary of State or Business Registration office a call for the full rundown.
One thing folks tend to forget is to check with the Secretary of State’s office to see if the business name they want is up for grabs (and checking for available website domains and social media handles too). It’s a good way to make sure your desired name isn’t already taken.
Frequently Asked Questions (FAQs)
How Do You File a DBA?
Filing for a DBA is pretty straightforward and easier than setting up an LLC. But the rules can change depending on where you are and what kind of business you’re running. You might have to register your DBA with the state or your local city or county, and there could be extra steps like putting a notice in the paper. Usually, it’ll cost you less than $200 as a one-time fee.
Can I Use More Than One DBA?
A company can use as many DBAs as it wants.
What’s the Difference Between a DBA and an LLC?
DBAs and LLCs serve different purposes. A DBA, or “Doing Business As,” lets a business change its public name or operate under a different one. On the other hand, an LLC is a legal structure that shields a business and its owners from financial and legal troubles, like lawsuits.
Does a DBA offer Any Legal Protections?
Nope. A DBA is just a fancy way of saying a business is using a different name officially. But it doesn’t give the parent company any extra protection from legal or financial issues tied to that DBA name. And it won’t shield the DBA from any troubles the parent company might face either.
What Type of Businesses Are Best Suited for a DBA?
Sole proprietorships or partnerships often go for a DBA, mainly because they usually end up with the owner’s last name unless they decide on something else in a DBA filing. These businesses should really think about whether a DBA or an LLC is the right move for them.
How Long Does a DBA Last?
The lifespan of a DBA differs depending on the state, so it’s a good idea to reach out to your state’s secretary of state or the agency where you filed the DBA to find out if you need to renew it and when that’s due. States like New York don’t require renewals, but others do have deadlines. In lots of states, you’ve got about five years before you need to renew or extend your DBA.