Fictitious Firm Name
Today, through this article, I will make you understand completely, about the concept of “Fictitious Firm Name” and “Fictitious Name Certificate” or “Doing Business As”
FBN (Fictitious Business name) is any supposed name, or a title different from the proper name of the entity using such name. The term fictitious business name contains a name presumed by a business owner or a general partnership.
An entity is delineated as “any individual or any partnership, corporation, joint-stock company, association, business trust, syndicate, joint venture or other amalgamation or group of individuals, irrespective of whether it is formed or organized under the laws of Commonwealth or any other jurisdiction.” An appropriate name of business or an association (local or foreign) is the name outlined in its registration and organizational documentation, filed in the concerned department of State.
Let’s be simpler!
Any name different from your legal proper business entity name, and you are allowed formally by the concerned department of the county or state to use while conducting business. A fictitious business name is also referred to as DBA (Doing Business As). A fictitious business name can be defined as.
“A legal document showing the operating name of a company, as opposed to the legal name of the company. In the case of a corporation, a fictitious business name is any name other than the corporate name stated in its articles of incorporation”.
Is that understandable? No…
Let me try to explain Fictitious Name with the help of an example! Suppose,
If you have decided to start your own business as a single business owner (a sole proprietorship) or a partnership, then you need to have a name for your business.
Now, you will have the choice of selecting a proper name or DBA (doing business as) for your businesses. This is called a fictitious business name. That name must not be registered before and should be available.
If you wish to run your business under a name different from your own (for instance, Ms. Mary doing business as “Crunchy Saloon” then she may be required by the state or county to get registered her fictitious business name. There are some states and counties require fictitious business name or DBA (doing Business As) filings to be prepared of (for consumers’ protection), of conducting business with an entity.
The main reason behind a Fictitious Business Name is that states are required to file fictitious business names because they are supposed to inform and update the public (consumers) about who owns that business or company. A fictitious business name filing places a business’s name and its owner’s identity on the public record.
The concept of “Fictitious Firm Name” also known as DBA (Doing Business As) is misunderstood commonly, but it can be a respected and esteemed mode to launch a business unit and have more or fewer protections of your rights as a single business owner. However, you need to be alert that you know the restrictions and boundaries of a doing business with a “Fictitious Firm Name” also known as DBA to safeguard your cogent intellectual property or any other trademark rights.
To get registered your business with a “Fictitious Firm Name” you are required to fil and filing offers the sole proprietorship owners (single owner of the business) the complete independence to use a business name what helps in promoting their goods or services, also make a discrete certified business entity. Yet, be warned that doing business with a fictitious name may not protect your business name from being used by other businesses. To have full safety in this regard, you are required to pursue your business trademark protection from the pertinent authorities.
Consequently, the name under which a business functions, as opposed to the lawfully obligatory name of the business is deliberated as Fictitious Firm Name or DBA (doing business as).
You can call a business name to be a fictitious firm name, when that business name is changed from its legal or registered name and this is done actually, for consumers’ protection. And such fictitious names will not include words like “Inc.,” “incorporation” as long as this is a “corporation” registered with the secretary of the state.
You are required to be attentive before starting a business with a fictitious firm name because the procedures, rules, and regulations of filing may vary from one county or state to another.
How to get a Fictitious Business Name; Requirements
To launch a business under a Fictitious Business Name, you are required to fill and file the FBN forms and pay a prescribed filing fee, after that, you will be able to receive an FBN certificate. According to the state, you may be needed to file with the county clerk’s office, with a state agency, or both. Therefore, don’t forget to validate all the related local central authorities for FBN filings in the states presently you are, or will be, or doing business in. Then ratify all the FBN filing necessities for your business.
Is that difficult? Let us understand more clearly!
You are required to consider the following while applying for the Fictitious Business Name. You can file online with a credit card, or you can fill the PDF form using your computer. Then take its print out and sign it.
Your statement is ready now.
- To register your business with Fictitious Name, you must visit the county’s office to apply along with a prescribed registration fee to the county officer or clerk (if any).
- You may need by the county to submit a fictitious name ad for an assured time once a week for four weeks consecutively in an arbitrated newspaper County.
- This ad must be initiated within 30 days after a fictitious business name application has been filed, according to Business & Professions Code 17917(a)
- You may be charged, a price ranging ($10 to $100), while filing a case of fictitious firm name and must have a business bank account and your bank possibly will ask a fabricated name certificate, and the bank may help you how to get it.
- In many of the states, a business firm may not be required to file a fictitious business name if that business runs under a name other than its own. The incorporation filling process may follow a similar procedure like business as fictitious name filing does for a sole proprietorship and a partnership business types.
- Your residential location addresses need to be listed and application may be filed through any of the following ways;
- You are required to present (in-person) a completed Fictitious Business Name (FBN) statement, display valid credentials, and complete an Affidavit of Identity form.
- You may submit through (mail) fully completed Fictitious Business Name (FBN) application, with a notarized Affidavit of Identity form.
- Anybody else other than you but on your behalf, can submit an application for Fictitious Business Name (FBN) and must show valid identification, and submit the completed notarized Affidavit of Identity and Agent form.
Now let me answer in advance, the questions that might arise while starting a business as Fictitious Business Name and its process of registration
- Legal Identity – You don’t need to consider FBN as a dissimilar legal entity because there is no difference between your assets and business assets. Registering an FBN may not cause your liability as an owner of the business.
- Consumers’ Protection – To provide full protection by the state, to the consumers, FBN is meant for the people to know about the actual business owner to safeguard consumers’ protection, from the fraudulent business owners, and they must not discharge from legal concerns when they operate their business operations under a different name.
- Business Account – When business is a distinct legal entity then personal funds and business funds are required to be managed unconnectedly. Subsequently, you need to have a separate bank account for the business when it is run with an FBN (Fictitious Business Name). Whereas, in case of a sole proprietorship or partnership without FBN, don’t need legally to have a separate business account.
- Advantages of FBN (Fictitious Name) – When you launch a business as FBN, you undoubtedly like to keep your expenses low and grow gradually, and filing for Fictitious Name registration, sure will help you to achieve your business goals.
- Business Recordkeeping – In the case of FBN (Fictitious Business Name), there is no need to have daily record-keeping of transactions and auxiliary protocols those are compulsory in case of an LLC or corporation type of business, or the expenditures related with forming an LLC (Limited Liability Company) or corporation.
- FBN or LLC (Limited Liability Company) is better – The main difference between the two is accountability protection but LLC (limited liability Company) offers limited liability protection. The personal assets of the business owners remain separate or detached fully from the business. No additional tax-related advantages and benefits can be claimed in the case of FBN (Fictitious Business Name).
- Doing business without an FBN – In some states, for instance, California, you don’t need to register an FBN (Fictitious Business Name) according to California law, any of your business names will not consider as FBN (Fictitious Business Name) since it includes your last name.
- State taxes – You are required to submit your business returns to the tax office of the state or county since IRS is not the only state entity that needs FBN firms to file tax returns annually. Filing for an FBN allows you to launch a business under another name without making a new firm.
- USE an FBN (Fictitious Business Name) – You may file to have an FBN (Fictitious Business Name) if you are willing to make business transactions under the company’s domain name but your company name is not existing as a domain name.
- Unemployment Insurance – Any business either FBN (Fictitious Business Name) or LLC (limited liability company), will not affect your unemployment insurance claims.
- Personal bank account and Business Checks – Checks received from business customers, may be deposited into your bank account, but I suggest you have a distinct business account because, some banks ask to have a separate business bank account if not, then you may not be permitted to credit your business checks into your bank account.
- ONE FBN name and two businesses – you may not be permitted by some states to use one single FBN (Fictitious Business Name) for two different businesses. Although, some businesses may get registered a solo FBN.
- Unique Business Name – FBN (Fictitious Business Name) must be different from the names, which are already in use in the state. Remarkably similar names if already in use, must not be taken, in case of when two businesses are rivals of each other in a similar marketplace.
- Sole Proprietorship and FBN – You will be required to have your legal name for your business to be operative. In case, you are not keen to use FBN (Fictitious Business Name), you must get permission from local authorities in advance.
- FBN Ownership – You may transfer ownership of FBN to another party for any reason, and in most cases, maybe a sale of your business.
- FBN (Fictitious Business Number) – It is recommended by some business lawyers and consultants to have EIN (Employer Identification Number. You must launch an SS-4 application to get this identification number from an internal revenue department.
- Obtain a copy of FBN – You may visit, county’s state department in-person or via mail, email, or fax to obtain a certificate or a copy of FBN, and an online approach will be a stress-free option.
- States and FBN – the different states like Ohio, Alaska, Arizona, Alabama, Delaware, Florida, Kansas, Hawaii, Maryland, Mississippi, New Mexico, Nebraska, Wyoming, and Wisconsin may require FBN (Fictitious Business Name).
- Time – Typically, the filling is needed to be completed within a postulated time roughly 1-2 months, once you started your business under FBN (Fictitious Business Name). The filing process usually, takes one to four weeks depending on the authority with some exceptions.
For Example – A guide
Starting a Business with FBN (Fictitious Business Name) in California – Step-by-step
- Check the name availability what you are intended to use
- File a statement (application) of FBN (Fictitious Business Name) in the county’s clerk office
- Advertise your new business name once a week for four consecutive weeks
- Pay the prescribed fee
- Follow-up your case
Your business name is a valued asset, and you may need to protect it. Using an FBN (Fictitious Business Name) can be a significant element of your business plan and strategy. If this is the case, then preparing an appropriate filing to get your FBN (Fictitious Business Name), and being assured that the registration does not expire will be crucial steps for your business. Now, you know the basic facts, procedures, and process about FBN (Fictitious Business Names) and its filings, work with your business lawyer and compliance partner to ensure they’re done right. Don’t underrate the significance of acquiring your fictitious business name certificate. You certainly need to apprehend what a fictitious business name is and how it can help and aid your business. Your business name will be the underpinning upon which you are required to build your business brand, hence it’s somewhat to be controlled with vigilant consideration.