Assumed name registration (which can include DBA filings, trade name and fictitious name registration) establishes the use of a name and, in many states, prevents other entities from registering the same or similar name.
A key question that comes up for many brides-to-be is the decision to take her husband’s name and make the necessary changes to her social security card, driver’s license, etc. For me, the decision was an easy one. My maiden name, Bacon, had been the source of lots of jokes as I grew up, so I didn’t have a lot of regrets leaving all those ‘original’ and ‘witty’ remarks behind.
Like individuals, business entities can have good reasons for doing business under another name.
Why Do Business Under Another Name?
- Registering to do business in another state as a foreign entity but the true name does not meet the requirements of that state. Most commonly, an entity’s true name is not available and a different (and available) name is chosen to use in that state instead. Sometimes the name is available but doesn’t meet the requirements for other reasons. Perhaps it lacks a required corporate indicator or contains a word that is allowed in the entity’s home state but is restricted in the state they’re registering in as a foreign entity.
- Voluntarily opting to use another name for business reasons, such as to reflect affiliated brand names. A company that owns several restaurants, for example, may file assumed name certificates to do business under the name of each restaurant. Other reasons may include reflecting an abbreviated version of their true name in common usage or reflecting different names based on divisions or different locations.
Almost every state requires a filing (e.g. application for fictitious name or trade name registration) if the company elects to do business under another name. Several states provide some protection for the assumed/fictitious name in that other entities aren’t allowed to use the name in the state. Even in states where this is not true, assumed name registration still helps establish the usage of the assumed name by the company.
Name Terminology Can Be Confusing
States use different terms to refer to names used by entities that are not their true corporate names: assumed name, d/b/a, fictitious name, alternate name, and trade name are most common.
Unfortunately, the same terminology can often be used regardless of whether a company must use a different name to do business or a company voluntarily uses a name, in addition to the true name. As the associated procedures usually vary by state, this conflation of terms can often lead to confusion.
For clarity’s sake within this post, forced fictitious names are used when the true name is unavailable or does not meet the state’s criteria. Elective assumed names are used by choice.
Forced Fictitious Name Requirements
Forced fictitious names are usually listed right on the qualification documents. Some state forms provide a specific blank for these names, others ask you to add the forced fictitious name right after the true name with a statement such as “under the assumed name…” or “which will do business under the name…”.
In addition, the following states require the submission of a board resolution approving the use of the forced fictitious name:
STATES REQUIRING SUBMISSION OF BOARD RESOLUTION
FOR FORCED FICTITIOUS NAME
|State||Business Corporation||Limited Liability Company (LLC)||Limited Partnership (LP)|
|District of Columbia||X|
A few other states, including Massachusetts and Hawaii, also require the entity to follow the steps needed to use an elective assumed name.
Voluntary Assumed Name Requirements
How elective assumed names are handled varies greatly from state to state. Here are some of the variations you will see:
- Assumed Name must be renewed or refiled.
In about 32 states, an assumed name will expire and must be either renewed or re-filed as a new assumed name. The most common assumed name renewal period is five years, but renewal dates vary from state to state. Some states send notification when a name is about to expire – but not all do. Tracking and renewing in a timely way is an important step to ensure compliance.
- Assumed Name is considered a 'trademark' type filing.
Alabama does not have a separate elective assumed name statute but files ‘trade names’ under the trademark law. When applying for an elective assumed name in Alabama, the entity must present samples of the ‘mark’ (assumed name) in use as on letterhead, signage, etc.
- Assumed Name is considered a ‘license’ filing.
Washington, on the other hand, registers an elective assumed name on the same form needed to apply for a state-level business license.
- Assumed Name filed at a local level.
Several states require the elective assumed name be filed locally, at the county or municipal level. See the chart below for details.
WHERE TO FILE ASSUMED NAMES AT LOCAL LEVEL
|State||Where to File|
If company is transacting business in a county under a name other than its own, and has not filed an optional Trade Name Registration, with the state of Arizona.
|California||In the county of the California office or, if no California office, in Sacramento county|
|Connecticut||Every city or town where you are doing business under the assumed name.|
|Delaware||Every county where you are doing business under the assumed name.|
|Georgia||Every county where you are doing business under the assumed name.|
|Massachusetts||Every city or town where you are doing business under the assumed name.|
|Nevada||Every county where you are doing business under the assumed name. There is also a voluntary filing which can be made with the Secretary of State to protect the name.|
|North Carolina||File at the local Register of Deeds in one of the counties where business is conducted. You can indicate all counties where the assumed name is being used on single form. On December 1, 2017 NC started using a central statewide database of all assumed name filings made on or after this date. Entities which filed prior to 12/1/2017 should re-file under the new law by 12/1/2022.|
- Is the Name Protected?
Some states require that the assumed name be available for use, thus protecting existing assumed names from being used by other entities in the state. Other states do not. Ohio offers two choices: trade name and fictitious name. If a company files a trade name registration, the name must be available for use and the user is asserting the right to exclusive use. If a fictitious name registration is filed, then the elective assumed name the company wants to use does not have to be available, but the company also has no right to exclusive use.
- Publication Requirements?
Both California and Minnesota require that notice of the assumed name be published when the initial filing is made or when it’s amended. Georgia, Florida, Nebraska, and Pennsylvania require publication only for initial assumed name filings. (More information on post-filing requirements.)
Doing business under another name, whether forced fictitious or voluntarily assumed, comes with a great many rules, requirements, and renewal dates to track and manage. Managing all of this correctly can greatly impact a company’s ability to use the name and, in some states, have that name protected. It’s important to be knowledgeable and aware of all the nuances – or engage a professional service for assumed name compliance.
Access our webinar recording below for more guidance on assumed name registration and maintenance:
This content is provided for informational purposes only and should not be considered, or relied upon, as legal advice.