Fictitious Business Names: Do You Need One?

Before you start doing business under a name that differs from your own (if registered as a DBA), ensure you fully understand the meaning of fictitious business names or doing-business-as names. This FindLaw article explains what a fictitious business name is when it requires registration and how it can help a small business.

See FindLaw's Starting a Business and Sole Proprietorships sections for related articles.

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Sole Proprietors and Fictitious Business Names

Sole proprietorships must register their business under the owner's legal name. Most sole proprietors, such as freelancers, do business under their legal names. The sole proprietor may not need a company name or extra branding. They are comfortable with using their personal name.

For instance, a dog walking service operated by John Smith likely would have a much better chance of finding customers if he promoted his business under "John's Dog Walking" or something more descriptive than just "John Smith." Any business name that differs from the legal name is a "fictitious business name." Even something like "John Smith: Dog Walker" would differ from the actual legal name of the sole proprietorship.

A sole proprietorship that does not take its owner's legal name must normally register the business with an agency of the state government, typically the Secretary of State's office. But many states differ on what is a person's "legal name." Under Florida business law, for example, a legal name is "a person's given name or an entity that has been properly registered." This may include trademarks, service marks, and the sole proprietor's name.

LLCs and Corporations and Fictitious Business Names

Corporations, limited liability companies (LLCs), and partnerships may also register fictitious names. Filing a fictitious business name statement (FBN) offers certain advantages for these business structures.

For example, an LLC called "Trinity's Computers" may want to start selling more product lines. If she decided to sell candles, it would not make sense to sell them under "Trinity's Computers." She may file an FBN under a different name, like "Trinity's Candles."

What Are The Benefits of Having a Fictitious Name For My Small Business?

The government wants a quick way to determine who owns a business entity in case of legal problems with the business. Suppose your business does not take your name. In that case, consumers complaining about your company may have difficulty locating you if you have not registered a fictitious business name. It also allows other businesses and start-ups to search for business names already in use.

Registering a fictitious business name is not just about helping consumers find you for a lawsuit. For example, suppose your business operates under a non-registered fictitious business name or trade name. In that case, you, as the owner, can't sign any contracts or enforceable agreements on your business's behalf. Depending on state laws, you can't open a business bank account under a DBA name without registering it with your state's secretary of state or county clerk's office.

Using a DBA, fictitious business name, or assumed name allows you to operate under the existing business you may already have. This means you do not need to:

• Buy more insurance
• Create a new employer identification number (EIN)
• Register a new business and articles of incorporation with your secretary of state
• Pay new business filing fees
• Get more business licenses (unless required by state or federal law based on your new product or service line)

So, if you plan on operating your business under a DBA or assumed name instead of your name, that of your limited partnership or LLC name, register it.

What Are The Steps to Register a Fictitious Name?

Each state has its own fictitious name registration process. You can see what your state requires here.

Searching For Your Fictitious Name

Search to see if your proposed fictitious business name is already used. You should check:

• Your secretary of state
• Your clerk of court's office in your principal place of business
• Online search of the United States Patent and Trademark Office for trademarks and servicemarks (applications and registered marks)
• Online search on Google, Facebook, and domain names

Before registering your FBN, make sure you can use that name.

Filing Your Fictitious Name Registration

Where you need to file your name registration depends on the laws of your state. Most states require you to file with the secretary of state. Some states also require you to file at the county clerk's office where your business operates. You may have to publish your fictitious business name in a local newspaper of general circulation, too.

You can see what your state requires here. You will pay a minimal filing fee, typically $30-$60. Once you have filed your FBN, it will be a public record.

Questions About Fictitious Business Names? Talk To an Attorney

As difficult as it can be to run a business, starting a new one from scratch is even more challenging. Small business owners with questions about an FBN should talk to their local Small Business Administration (SBA) or a licensed business attorney.