Does Your Business or Nonprofit Need a DBA? Guide to DBAs
Registering a “Doing Business As”
Naming a business is an important branding strategy for a person or entity involved in business in California. An individual or a business entity must file a fictitious business name (FBN) statement with the Registrar-Recorder/County Clerk's office in the county where the business will be located when the name of the business does not include the owner's last name.
This process is also known as registering a “Doing Business As” (DBA) or “Trade Name”. If the business is not located in California, the business needs to register with the Clerk of Sacramento County.
Filing a FBN statement makes the identity of the person doing business under the fictitious name available to the public.
Registration is necessary when:
A sole proprietorship will be doing business under a name that does not contain the owner’s last name.
A partnership or other association that will use a name that does not include the surname of each general partner or a name that suggests the existence of additional owners such as “Company,” “& Company,” “& Son,” “& Sons,” “& Associates,” “Brothers,” and the like.
A limited partnership, corporation, or Limited Liability Company (LLC) will be doing business under a name not stated in the Articles of Incorporation or Articles of Organization filed with the California Secretary of State.
Example:
If Michael Rocco owns a sole proprietorship, and his business name is Michael Rocco Painting, he won’t need a fictitious business name because people will know who the owner of the company is and the type of business.
If he wanted to go by either Michael and Sons Painting or House Painting Fast, he would need to file because the business name suggests additional owners and doesn’t include his last name.
If Michael Rocco instead owned either an LLC or a corporation and wanted to open up additional businesses under the LLC or corporation, he would need a fictitious business name statement for any business name other than the entity’s legal name.
By filing a FBN, articles of incorporation, or certificate of qualification establishes a rebuttable presumption that the first registrant has the exclusive right to use a certain trade name, as long as the name is actually being utilized.
It’s all in the Name. How to Choose a DBA
It is important to select a business name that is not already in use, does not closely resemble an existing business name, or misleads the public.
Many cities and counties offer a FBN search on their individual websites. The Governor’s Office of Business and Economic Development conveniently provides links to most county and city websites through its CalGold website. Although a business does not file a FBN statement with the Secretary of State (SOS), the SOS is a good resource for determining if a business name is already in use.
The DBA Process
The fee to file a fictitious business name statement varies depending on the city or county where it is filed. The filing is valid for five years or until the facts in the statement change, whichever occurs first.
A fictitious business name statement usually must be filed within 40 days of starting the business. Along with the original, the county or city may require several copies of the statement for filing. The clerk or recorder will certify and return all copies to the registrant, keeping the original.
Within 30 days after filing a fictitious business name statement, the registrant must publish the statement in a local newspaper of general circulation near the principal place of business. The notice must appear once a week for four successive weeks.
Within 30 days of the last published date, the registrant must file an affidavit of publication with the city or county office. Check with the Registrar-Recorder/County Clerk's Office to determine if there is a specific list of approved publications in which to meet this requirement.
Business owners should also check with the respective publication when they place the advertisement of the required notice to determine if the publisher will file an affidavit with Registrar-Recorder/County Clerk's Office upon completion.
Do Nonprofits Need a DBA?
There are many reasons why a nonprofit may want to use alternate names, including making a name shorter, or to represent a particular project or mission. A nonprofit considering a name change can either legally change its name by amending its articles of incorporation (or comparable founding document), or it can use a DBA or “fictitious business name.”
Generally, a nonprofit organization must register its DBA in each state. However, in some states, a nonprofit may be exempt from DBA requirements. In certain states, the nonprofit may not be able to enforce agreed contracts until the DBA is registered, potentially facing a penalty if it tries to do so. If you are unsure whether you need to legally register a DBA, it is wise to seek counsel from a nonprofit attorney.
Need assistance with filing a FBN? We can help.
If you have questions or need assistance in filing a Fictitious Business Name Statement, nonprofit lawyer Jonathan Grissom can help. Please contact us via the button below.