What is DBA mean
DBA acronym – “Doing business as”
Let me define and explain the salient features, advantages, and benefits of DBA (doing business as) and various requirements in very simple manners.
DBA or doing business as is assumed business name, or a fictitious business name to make the public aware about the real and true business owner.
What does DBA mean in business?
You are required to bear in mind that any business you intend to start needs a name. If you have decided and planned to start a new business either as a single owner (sole Proprietorship) or with a partner (a partnership), then you have a choice to select a legal name of your business (business name) or DBA (doing business as) for your new startup.
The DBA is misinterpreted frequently, but it can be a valued and respected mode to establish a business entity and have more or fewer safeties and or protections of your privileges and rights as a single business holder. Nevertheless, you are required to be aware that you recognize the limitations and boundaries of a DBA to shield your rational intellectual property and other trademark rights.
If you wish to run your business under a name different from your own; for example, Mike Maziar Dostdar doing a new business as “food paradise” then you will be required to get this fabricated name registered by the dissimilar state authorities.
Filing a DBA provides the sole proprietor (single owner of the business) the autonomy to use a business name that assists in marketing their goods or services, also build a distinct certified business identity. Nevertheless, be warned that a DBA (doing business as) doesn’t guard your business name against being used by others. And for the same are required to pursue trademark protection from the relevant authorities.
Thus, the name under which new business is operated, as opposed to the legally required name of the company is considered as DBA (doing business as) and such names must not include the following wordings unless this a corporation or company registered with the Secretary of State.
You can call a company to be DBA (doing business as) when the operating name is different from its registered or legal name. For the sake of consumers’ protection, doing business with the entity, a few States need DBA or fabricated business name filing to be made by the new business owners who are to start a new business with the name other than their name.
You need to be very vigilant while starting DBA “doing business as” because the rules and regulations, procedures, and processes for filing a fabricated name may differ from one state to another state.
To get your business registered as DBA (doing business as), you need to visit county offices to submit an application and deposit registration fee (if any) to county officer or clerk.
You may be required by the State to place fabricated or fictitious name ads for a certain period of time in the local newspaper. You may be charged the price between $ 10 to $ 100 of filing a fictitious name and to open a business account your bank may ask a fabricated name certificate, they may guide you to get it.
In the majority of the states, a company is not required to file a fabricated or fictitious business name if a company runs a business under a name other than its own. Incorporation documentation having the similar effects of corporate businesses as fabricated or fictitious name filing does for the single owner (sole proprietorship) or partnership kind of business.
How to File a DBA or Fictitious Business Name?
You can have below the answers of questions, you may come across while starting a business as DBA (doing business as) and its registration process
- Consumer Protection – To offer maximum protection by the state for their consumers, DBA is meant for the public or people to know about the real owner of the business to ensure consumer protection, therefore fraudulent business owners could not escape from legal concerns when they run their business under a different name.
- Legal Entity – You are not supposed to consider DBA as a different legal entity because there is no discrepancy between business assets and your personal assets. Registering a DBA does not cause your personal liability as an owner of the business
- Business Account – If your business is a separate legal entity then business funds and personal are required to be managed separately. So, you are required to have a bank account for your business if it is operated as DBA. Sole proprietors and partners (in partnership business) without DBA are not required legally to have a business account.
- DBA Advantages – Once you start your business as DBA, you certainly like to retain expenses small and the progression modest and filing for a DBA registration may facilitate you to accomplish this goal.
- Recordkeeping – In case of DBA (doing business as) you are not required to have the endless day to day complex record-keeping and further regulations which are mandatory in case of upholding an LLC or corporation or the expenses linked with creating an LLC or corporation.
- State taxes – it is obligatory too for the businesses to submit their returns to the state tax office because IRS is not the mere state entity that requires a DBA to file tax returns annually or may be on the basis. Filing for a DBA permits individuals to run the business under another name without forming a new organization.
- DBA or LLC better – The main difference between an LLC (limited liability Company) and DBA (doing business as) is accountability protection and LLC (limited liability company) affords limited liability protection. The personal property of the business owners remains detached or separated completely from the business. At the same time, no additional tax benefits are given in case of a DBA (doing business as).
- Doing business without a DBA – In some states like California, you are not required to get registered a DBA or fabricated business name and according to California law, a business name is not considered a fictitious name as long as it includes your last name.
- USE a DBA – You can launch an application to file a DBA (doing business as) when a company is willing and want to transact business under the company’s domain name and the company name is not available as a domain name.
- Unemployment Insurance – any type of business either DBA (doing business as) or LLC (limited liability company) doesn’t affect your unemployment insurance.
- Business Checks and personal bank account – business checks can be deposited into a personal bank account, but you are preferred to have a separate business bank account because a few banks may ask you to have a business bank account otherwise you will not be allowed to deposit business checks into your personal bank account.
- Two businesses and ONE DBA name – you may not be legalized by some states to have one single DBA (doing business as) for two businesses. Though some businesses register a solo DBA, in some cases, more than one DBAs are the most valuable choice.
- Unique Business Name – DBA name must not be identical to the name already in use in the state. Surprisingly similar names (if already in existence) must be avoided in case of when two businesses are competing with each other in the same market.
- Sole Proprietor and DBA – a single business owner is obligatory to have his legal name for his/her business to be operational. In case, not willing to use DBA (doing business as), a single owner must get permission from local state authorities in advance.
- DBA Ownership – DBA ownership can be transferred to a third party for many reasons, in most cases what it is a sale of the business.
- DBA Number – Small business consultants recommend having EIN (Employer Identification Number. You must launch an SS-4 application to acquire this number from the internal revenue service’s authorities.
- Obtain a copy of DBA – You can ask the county state department and this can be done via mail or email, fax even in person but attaining a certificate or a copy of DBA online is a stress-free option.
- States and DBA – the states require DBA (doing business as) are Ohio, Alaska, Arizona, Alabama, Delaware, Florida, Kansas, Hawaii, Maryland, Mississippi, New Mexico, Nebraska, Wyoming, and Wisconsin.
- Time – Usually, the filling is required within a stipulated time (30-60) days once you started using the name. The filing process usually takes 1-4 weeks depending on the jurisdiction with some exceptions.
For Example – Starting a DBA in California – Step-by-step
- First, check the name availability or if is not taken already in California
- Submit a statement of fictitious or DBA business name at county’s clerk office
- Publish your new business name
- Deposit the required fee set by the state authorities
- Lastly, follow-up your file
Filing a DBA will be a fast, firm, and effective and operative selection to make your business “legal, authorized, and official” while if more or fewer benefits, but be certain that you are cognizant of the limitations or restrictions of this business name description.
Filing a DBA can be useful and supportive for forming several businesses as long as they are all unified and integrated underneath an inclusive LLC or supplementary corporate umbrella. not only you can always grow in your business but there will be a lot of benefits of doing business. so let us see what will be the benefits for doing or starting your own business.
1- You are doing business it will directly affect society, as you draw the employment. ( employment means producing different jobs for your society). so the gap between jobs and job seekers gets stable over here. If not on a larger level but on a smaller level it will work too.
2- You are utilizing different resources to turn it into something useful. ( utilizing resources means to use those resources that are not useful if they remain in their raw forms like steel and steel after getting refined it becomes useful. so like this there are many examples that work here and when you do business one way or other you use, recycling different things). well, it is not necessary to have a business where you are using some raw material but it can be anything.
3- with the business start-up you are transferring people on the new trend which are not about 9 to 5 jobs, but a flexible working environment that allows a lot of people to pursue their passions in life. since it has become a trend of doing jobs every person-shaped and designed his life and career accordingly to get a job. and doing a job made their life bound in a box, people dose not get more time than their job and it suffocated many.
The business allows you to have a work that you really love and that does not make you tired.