FICTITIOUS BUSINESS NAMES:
"Doing Business As"
(Written by Cristi Brooks, this article originally appeared in the July 4, 2005 edition
of the KIRK & SIMAS Small Business Reporter — Volume 11, No. 1)
One popular topic for this newsletter is how fictitious business names work. With the return of the newsletter after an 18 month hiatus, we thought it was time to revisit the topic. A fictitious business name, assumed name or DBA (short for "doing business as") allows you to legally do business under a particular name without having to create an entirely new business entity. You can advertise, accept payments and otherwise present yourself under that name.
States like to keep track of fictitious business names for a couple of reasons. One is to prevent consumer confusion between two local businesses that use similar names. Another is to give consumers a quick way to determine a company owner without having to hire a private investigator. This allows consumers to easily contact owners with a complaint or to take legal action.
There are plenty of reasons not to shrug off this requirement, the most practical being that many banks will not open an account under a fictitious business name unless you have proof that you have properly registered the name. Perhaps even more important, you cannot enforce any contract that you sign under the name. Finally, if you do not register your fictitious name, you are not giving other businesses notice that it already is in use. If a competing business cannot find out that you are already using the name, it might take it for its own and possibly take away some of your business. Fortunately, filing for an assumed name is so easy and inexpensive, there really is not much excuse for not filing one.
What is a Fictitious Business Name?
- With individuals — a name that does not include the owner(s) surname or suggests the existence of additional owners, such as "& Sons" or "& Associates."
- Partnerships — a name that does not include the surname of each general partner or a name that suggests the existence of additional owners.
- Corporations — any name other than the corporate name stated in the Articles of Incorporation.
- Limited Partnerships — any name other than the name of the limited partnership as on file with the Secretary of State.
- Limited Liability Companies — any name other than the name on the LLC as on with the Secretary of State.
What does a Fictitious Business Name let you do?
- It allows you as a sole proprietor to use a business name rather than your personal name.
- It allows a single legal entity (such as a corporation, an LLC, etc) to operate multiple businesses in one or more locations without creating a new legal entity for each business.
When and where do I file a Fictitious Name Statement?
- Locally you will need to file all the necessary paperwork at any of the three Santa Barbara County Clerk-Recorders Offices or online at their website. In other counties, the filing usually is done in their County Clerk’s office.
- You can file any time before you make your first transaction, but you must file within forty (40) days after making your first transaction.
- You must also update the statement every five years, even if nothing about your business has changed.
Are their any other procedural requirements?
- Yes. The Fictitious Business Name Statement must be published, by the registrant, in a newspaper of general circulation in the county where the principal place of business is located. This must be completed within 30 days after filing the statement. Publication is required once a week for four successive weeks. An affidavit showing the publication must then be filed with the Clerk-Recorder’s office within 30 days after the completion of publication.
Remember, any business that does not use its legal name (the official name of the person or entity that owns the business) as part of its business name must comply with fictitious or assumed business name requirements. The name of your business is one of its most important assets. Once you have done the hard work of choosing your name and making sure that it is available for your use, you will want to protect it in every way you can.
(For information about the content of this or any other article found on this website, contact the respective authors.)
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