All person and business entity must file a fictitious business name (FBN) statement with the Registrar-Recorder/County Clerk’s office in the city where the business will be located.
Brad Nakase, Attorney
Email | Tel 800-484-4610
In California, a DBA name, or “doing business as,” is a fictitious business name that allows a company to operate under a different name than that under which it is registered.
It should be noted that registering a DBA name in California does not create liability protection. This means that a DBA does not protect a business owner’s personal assets in any way. Only by forming a business structure such as a limited liability company (LLC) will give a business owner liability protection.
A DBA is a useful tool for branding or marketing. It can increase brand recognition or make a name more descriptive of the particular business. For larger corporations or businesses, it can allow for individual branding without having to start separate businesses. Take Eva for example. She started out with a tailoring business but wanted to branch in wedding dresses. Her original name was no longer descriptive of her business, so she has reason to want a DBA related to wedding dresses.
In the event a company is sued, a DBA does not offer any protection of personal assets. Because of this, it is recommended that a DBA only be used by a formal business type such as a corporation or LLC, or by a business wanting to add new brands. In general, it is recommended to form an LLC rather than a sole proprietorship or partnership because an LLC offers liability protection. Doing so separates a business from an owner’s personal assets.
Luckily, filing a DBA in California is a relatively easy process.
In California, a business’ fictitious DBA name should be original and also meet the state’s naming requirements. Therefore, it is necessary for a business owner to search county and state records for the proposed name to ensure that it is not already taken.
Some of the naming rules in California include:
The full list of California naming rules is available in California’s Code of Regulations.
It is also recommended to check a potential domain name (URL). Even if a business owner has no immediate plans to start a website, it is still a good idea to reserve a domain name for a DBA. This would prevent other individuals from getting the URL first. It is possible to search for available URLs by using a service such as GoDaddy.
In California, DBA names are filed with the county in which the business primarily operates. This means that if a company mostly conducts business in Los Angeles, then the business owner must file the DBA with LA County. If, however, a company’s principal place of business is located outside of California, then it must file with the Sacramento County Clerk.
It should be noted that nonprofit organizations do not need to file a Fictitious Business Name Statement.
The state of California is responsible for creating and monitoring DBA regulations. This means that counties in California have similar steps for acquiring a DBA.
In Los Angeles County, a business owner can file a DBA online on the LA County Clerk’s DBA name portal. Or, if preferred, a business owner can call (800) 201-8999 to receive forms by mail. Forms may also be picked up in person at the County Clerk’s office.
When a business owner applies for a DBA in person, statements do not need to be notarized. If a business owner applies by mail or third party, however, they must provide a Notarized Affidavit of Identity. This form can be picked up in person at the County Clerk’s office or is available to be mailed by calling (800) 201-8999.
But not so fast! Once a business owner registers his or her chosen DBA, it must be renewed every five years with the relevant California county. Renewal forms are available on the county’s website. It costs $26 to renew a DBA name. It is possible that, depending on how the form is delivered, a notarization form may be required.
What if a business owner wants to change his or her DBA? Not to worry! To make changes to an already-registered DBA, a business owner can visit the Fictitious Business Name Amendment page on their county website. This form may need authorization depending on how it is filed.
It is also possible to withdraw a DBA. To get a Statement of Abandonment, a business owner should call their county clerk. The LA County number is (800) 201-8999. If a business owner’s county does not have this form available, then it can be created on one’s own using the rules listed on the California Legislative website.
The state of California requires business owners to publish a “fictitious business name statement” in a county newspaper within 30 days of registering the DBA. This statement must be published once a week for four straight weeks. For detailed publication requirements, one can visit the California Legislative website.
The publication steps and requirements can be summarized as follows:
The county clerk’s office can answer any questions regarding publication requirements. County contact information is provided on the California Department of Public Health’s website.
After filing a DBA in California, there are a few more steps to getting a business up and running.
Nowadays, every business needs a website, however large or small the company. Thankfully, there are easy-to-use websites like GoDaddy and Wix that can help build an amazing website.
An essential step of getting a business tarted is separating company finances from personal finances. To do this, a business owner should open a business bank account. Getting a business credit card is also a useful way of separating personal and business finances.
Business insurance protects a company’s assets in the event of a lawsuit. It is similar to how an LLC can protect the personal assets of its owner. The base coverage for a business is general liability insurance.
A business owner can have as many DBAs as he or she wishes to create. That said, they then have the burden of keeping track of them. Each DBA has its own expenses and paperwork, so they would really all need to be necessary for the business. Let’s say a big apparel manufacturer decides to branch into different areas, like perfume or handbags or shoes. Filing DBAs for each of these brands would be genuinely helpful for the business. However, a small business might not want to diversify its brand so soon because of the administrative hassle of managing so many DBAs.
A DBA does not need to have an EIN separate from the original business. This is because DBAs are not a business entity, like limited liability companies or corporations. The business entity that the DBA falls under would have an EIN. So, for example, let’s consider a company called Millie’s Designs, which has a DBA called Millie’s Theatre Costumes. Millie’s Theatre Costumes would not have an EIN because it is only an assumed name and not a business entity. Millie’s Designs, however, is the legal name of the business entity. Therefore, Millie’s Designs has an EIN.
A DBA is not a business entity. It is merely a separate fictitious name. This means it is not a sole proprietorship, nor can it become an LLC or a corporation. Importantly, it does not confer liability protection to an owner.
A DBA cannot have Inc. or LLC in its name unless the business entity is a corporation or limited liability company. Let’s consider a company called Andy’s Fine Footwear. Perhaps Andy wishes to create a DBA for his business called Andy’s Cowboy Boots Inc. However, Andy’s Fine Footwear is a sole proprietorship. This means he cannot put “Inc.” in his DBA unless he first changes his sole proprietorship to a corporation through the process of incorporation.
Depending on the situation, it may be a better choice to file for a DBA than change a business’ legal name. Filing for a DBA is a simpler process than dealing with a legal name change. Getting a DBA is a good option for a business that wishes to rebrand or branch into another sector. For example, a baked goods company might want to branch into ice cream, in which case it will file for a DBA.
If a business owner wishes to protect his or her DBA from being used in another state, the best option would be to trademark the DBA on a national level. If another company tries to use the name, then the business owner could sue for trademark infringement.
Learn more about: Business | Corporate | Employment Law
See all articles: Business | Corporate | Employment
See all articles: Business | Corporate | Employment