In 2020, professional and business services contributed $387,96 billion to California’s economy. Many businesses in California choose to operate under an assumed name, or a doing business as (DBA) name.
A DBA can have a number of benefits. For sole proprietors and partnerships, it can offer privacy, promote professionalism, and allow a separate bank account to be opened under the business’s name. For LLCs and corporations, a DBA allows the company to distinguish between different products or businesses offered by that company. In both instances, DBAs can be an important tool to be used in the branding of a business. Different states have different requirements for filing a DBA.
Considerations For Registering a DBA in California
Before setting up a business, you always need to ensure that the desired business name is not already in use. Likewise, when filing a DBA, or Fictional Business Name as it is known in California, you will need to check whether the name is available. This can be done by reviewing the California Secretary of State’s list of name reservations.
If your business will have an online presence, it is also advisable to ensure that the domain name for your business is available and reserve it as soon as possible.
It is important to remember that a DBA is not a separate legal entity. Rather it is a useful tool that allows you to operate your business under a different name. It, therefore, does not offer any legal protection for your assets.
Filing a DBA in California
Once you have chosen an appropriate name, you must complete a Fictitious Name Business Statement. This must be notarized and submitted with the local county clerk or recorder for the county wherein the principal place of business is located. While this is a state-wide requirement, in California DBAs are issued on a county basis, and as such certain counties have their own additional paperwork requirements. Fees also vary by county. It is therefore important to check your local county rules before filing.
Once you have filed your Fictional Business Name Statement, California legally requires you to publicize your DBA name. This is done by publishing a notice of the DBA in a local, qualified publication. The notice must be published within 30 days of the DBA being registered. The publication must run at least once a week for at least four weeks. To confirm this has been done, you will be required to obtain an affidavit from the newspaper within 30 days of the last publication.
Generally, the filing and publication process takes between two to three months and costs approximately $25 to $30.
Renewing a DBA in California
In California, a DBA must be renewed every five years. In order to renew a DBA, you must submit a new Fictional Business Name Statement before the expiry date, five years from the date on which the DBA was received. While you do need to file a new Statement, you do not need to re-publicize the DBA, unless changes have been made to the name.
Assistance with Filing a DBA
Although acquiring a DBA is one of the simplest filings an entrepreneur undertakes when setting up a business, the requirements for filing a DBA generally, and in California specifically, can be quite complicated. Furthermore, as a business owner or prospective business owner, there are various other important matters that require your attention. It is therefore worth considering seeking help. There are multiple reputable service providers, such as LegalZoom, which for a reasonable fee will take over the hassle of filling out the forms and completing the registration process. All that they require from you is some basic information. There are also various legal and tax implications involved in registering a DBA which may warrant obtaining legal advice.
A DBA can be a valuable tool for all types of business entities. In California, the basic requirements are; a unique business name, submission of a notarized Fictional Business Name Statement, and publication. While the process is relatively simple, due to variances between counties, it is advisable that business owners consider appointing a service provider to assist with registration, renewal, and change.