Legal Term Tuesday: "Doing Business As"

Law

Legal Term Tuesday: "Doing Business As"

Justin Lavelle

October 7, 2015

This is the latest entry in BeenVerified’s legal term library designed to help you better understand public record information, criminal records and related terminology. The information in this article is provided for informational purposes only and does not constitute legal advice.

If you want to start a business and create a separate identity for the company, including giving it a unique and fictitious name, you should register a DBA, or “doing business as” for the company with your county and/or state. To find out more about DBAs, how to officially be granted your ideal business name and if a DBA will show up on your public record, read on.

Registering a DBA includes completing a fictitious name statement or DBA statement with the appropriate government agency, which varies depending on your county and state. A DBA statement makes it easy for someone who wants to find the name of the owner of a business, particularly if they want to file a claim or lawsuit against the individual behind the business, according to NOLO.com.

DBA names need not be complex. A sole proprietor named John Smith who wants to operate as “Smith Roofing” would require a DBA name, according to Incorporate.com. DBAs can also be used to distinguish individual business lines from a primary business, according to Incorporate.com.

The benefits of registering a DBA name include simplicity and a lack of special tax filings, according to LegalZoom.com. Additional benefits include greater marketplace credibility, potentially more effective marketing and an easier ability to open business bank accounts, according to Incorporate.com.

Drawbacks of a DBA include a lack of legal protection that is typically afforded to more complex organizations such as corporations or LLCs. Certain jurisdictions may also charge fees associated with registering your DBA, according to Brighthub.com. DBAs also lack trademark protection, according to Exit Promise.

DBAs are public record and in fact, this is one of the primary purposes of the legal regulations surrounding DBA paperwork. DBA laws make it easy for anyone to find out the name of the person associated with the DBA name. This search can be made more challenging if the person you are searching utilizes an alias, potentially for the purpose of shielding his real name from connection with a DBA.

Failure to register a DBA can result in negative consequences in some states, including lack of an ability to enforce contracts and some states such as Missouri and Colorado will enforce monetary and even criminal penalties, according to LegalZoom.com.

Examples of famous DBAs include Kentucky Fried Chicken (owned by Yum! Brands), Sam’s Club (owned by Wal-Mart) and Cadillac (owned by General Motors), according to Answers.com.

Disclaimer: The above is solely intended for informational purposes and in no way constitutes legal advice or specific recommendations.