A DBA is easy and inexpensive to set up, and some business structures may even require it. If you’re wondering why you might want to set up a DBA for your business, keep reading.
Why Use a DBA for Your Business?
“Doing business as,” or DBA, is a fictitious name that lets you use a name for your business without creating a formal legal entity such as a corporation, partnership, or LLC. You may need the DBA to open a business checking account, and you’ll be able to get a business phone listing for your chosen business name. It’s the least expensive way to legally do business under a business name for sole proprietors. A DBA also allows a single legal entity such as a corporation or LLC to operate multiple businesses without creating a new legal entity for each business. For example, you might set up a parent corporation with a generic name like LVH Web Enterprises, Inc. or Neighborhood Bars, LLC, then file a DBA for each website or bar if you’re planning to operate a series or chain of them. You can also use DBAs to segregate your business. If your company wants to get into a new business line that has nothing to do with your existing business and company name, you can create a different, appropriate assumed name for the new business line. If your company sells the same products, but to different audiences, you can also use different assumed names to keep everything straight. For example, if you sell women’s clothing and baby clothing, you can set up two different assumed names to help you target each specific group.
Do You Have To Register as a DBA?
If you do not want to run your business under your own name as a sole proprietor, or under your partner’s name in a partnership, then you’ll need to register your business as a DBA. If your business name implies that more than one owner or individual is involved, for example, like Shawad & Sons or The Anderson Group, or if you just want to use only your first name, such as Joe’s Garage or Sam’s Boat Rentals, you would typically file an assumed name. If you didn’t want to use a DBA, you’d need to use your last name. In some jurisdictions, you can use either your full name or part of your name, plus a description of your product or service, without filing an assumed name. You might do business as Elena Garza Interior Design or J. Washington Investigations. The exact rules vary from state to state so check with your local business regulatory authority. There’s also the possibility that you have prospective clients that require you to have a DBA before they award you a contract for work.
How Do You Register Your Business as a DBA?
Check to see if you can register your assumed name with the Secretary of State or another state agency, but you may find registration handled at the county level in most states. Each county may have different forms and fees for registering a name. The process is usually fairly simple and straightforward. You perform a search through the provided database to make sure the name is not already in use, then submit a simple form along with the correct filing fee. Filing fees will vary based on your location. For example, a DBA costs $50 in New Jersey and is good for five years. In Orange County, California, it’s $23 for a DBA, and it’s also good for five years. You can renew your DBA after the time period expires. When you file for your DBA, it may take one to four weeks to hear back regarding your name approval. This varies by jurisdiction, but it’s wise to file at least 40 days before you intend to open the doors of your new business.
