What is a Fictitious Name?
A fictitious name is a name other than your proper legal business entity name that you formally get permission from the state to use when conducting business. You may also see a fictitious business name referred to as: Doing Business As (DBA), assumed name, or trade name.
Benefits for Various Business Structures
Fictitious names can benefit businesses of all types from sole proprietorships to LLCs to corporations. For example, John Doe wants to open a business called "Super-Size Apartment Movers." He will need to file as a fictitious named business or DBA with the county clerk’s office.
A sole proprietorship not using the owner’s legal name usually requires registering the fictitious name with the Secretary of State’s office.
Objectives of Using a Fictitious Name
The purpose of a fictitious name is to inform the public about who actually owns the company. A fictitious name filing puts the business name and owner’s identity on public record. With a registered fictitious name, you can accept payments and manage tax obligations under that name, simplifying tax processes.
The fictitious business name definition is: "Any title that does not include the owner’s whole name or indicates additional owners."
Trade Names and Trademarks
Trade Names
A trade name is the official name under which a company does business. Trade names register under state provisions based on the business form.
A trade name does not provide brand name protection or unlimited rights for use. While unique names are important, understanding the differences between names is essential to choose wisely.
Although trade names provide notice you are using that name, they do not prevent others from using the same name. States register trade names for tax purposes and to track companies.
Trademarks
A trademark legally protects and distinguishes products and services from competitors. Trademarks register under the Trademark Act with different approval processes. Trademarks secure brand names legally.
Reasons for Using Fictitious Names
To identify their business to customers. Fictitious names like "Green Bliss Gardens" can encapsulate a business’s offerings better than an owner’s actual name.
Filing and Financial Transactions
Filing For a Fictitious Name
To use a fictitious name formally, file paperwork and pay fees to register it. Requirements vary by state and county.
Banking and Taxes
With a registered fictitious name, you can manage banking, payments, and taxes more easily. Getting a tax ID facilitates taxation under that name.
Starting and Operating a Business
When launching a company, consider whether a fictitious name filing makes sense. Registration timeframes often last around five years or less before renewal.
Legal Considerations
Providing false names or addresses alone doesn’t necessarily constitute fraud. But doing so with criminal intentions violates federal law.
Privacy and Personal Data
Posting real names or details publicly risks making you an identity theft or hacking target.
Registration and Consumer Protection
Public Notification
Consumer protection laws mandate public notification of alternate business names.
Registration Locations
Where to find fictitious firm certificates? County clerks or Secretary of State offices, depending on location.
Checking a DBA
How to check a DBA? Ask county clerks where it operates. If unavailable, check with the state.
Banking Requirements
Banks often require registration to open accounts or process transactions in fictitious names. It establishes legitimacy.