When Do I Need to File a DBA?
A “Doing Business As” permit, also known as a DBA permit, “Trading As” permit, and sometimes called a “Fictitious Name” permit is required when a small business titles itself with a fictitious name. Depending on the state, this can be a municipal or county-level process, or a state-level function.
What is a Fictitious Business Name?
A fictitious business name is any business name other than your own personal name. “Computer Tech” is a fictitious name as is “Bob and Sons Plumbing”. So is “Robinson Consulting” because the person’s first name is not Robinson and their last name isn’t “Consulting”! Each would require a DBA permit.
What Is Not a Fictitious Business Name?
On the other hand, Jonathan Robinson, I.T. Consultant will not likely require a DBA because he is representing himself by his personal name (although he is using a byline on marketing materials to describe the business). Ultimately, it has to do with the name receiving payment. If the customer pays “Jonathan Robinson”, it’s a personal name and doesn’t require a DBA.
DBA Permits For Sole Proprietorships
Sole proprietors face the biggest set of decisions regarding the DBA permit because they can so easily use their personal name. A person can easily set up a sole proprietorship and simply operate under their own name. Consider the above in which Mr. Robinson is merely representing himself and not via a fictitious identity.
On the other hand, sole proprietors can also create a fictitious name. Mr. Robinson could easily call his business “Computer Tech” or “Robinson’s Technology Consulting”, all of which are fictitious names and require filing for a DBA permit
DBA Permits For Partnerships, LLC’s, and Corporations
Virtually any entity other than a sole proprietorship will require a DBA. It doesn’t matter whether it’s a partnership, LLC, or corporation – because these are independent entities, they need legal recognition of the name created for them. There are a few exceptions in states that allow one-person LLC’s and in which the person titles the business in their own name (ie. Jonathan Robinson, LLC). But, for the most part, plan on registering a DBA or its equivalent any time you form a business entity.
Ultimately the requirement to file for a DBA permit is a function of the naming of the business, along with the type of entity. If a fictitious business name is used, you must file for a DBA or its equivalent with the government office that handles it in your area. However, if the business is a sole proprietorship, and you operate under your own name, the DBA is generally not required.