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Tuesday, February 12, 2019

Small Business Law Blog: What is a trade name? What is a DBA? What is a fictitious business name?

 

A “trade name” is also called a “DBA” (or “d/b/a”) or a “fictitious business name.” I found an article on the first page of Google that distinguished the three, but the three terms really mean the same thing. In the State of Missouri, you can register a fictitious name. In New York, you register for a Certificate of Assumed Name. In the District of Columbia, you register a trade name. (Remember that a trade name is different from a trademark.) I will be using the term “trade name” throughout this article.

A trade name is any name used by a business that is different from the registered name on file with the state. If you are a sole proprietor or a general partnership that has not registered with the state, then the trade name would be a business name you are using that does not include the legal names of the sole proprietor or partners. For example, if a sole proprietor named Jolene has a YouTube channel called “JoJo’s Toys,” “JoJo’s Toys” is a trade name.

Most states require businesses using a trade name to register the trade name. Even if your business is registered as “Peanut Butter Snacks L.L.C.,” and you want to use “Peanut Butter Snacks” without the “L.L.C.,” you will usually be required to register the trade name. The states’ reasoning for this requirement is to ensure that customers, vendors, and other individuals or entities doing business with the company (or individual, in the case of a sole proprietorship, or a partner, in the case of a partnership) know the correct identity of whom they are engaging in business.

 

 

If I had a candy store that said, “Candy Store” on the awning, but my actual business name was “Candy Land Corp.,” a customer would have difficulty locating the owner of the business. Even worse, if a “Candy Store LLC” was listed in the public records, the customer could end up filing a complaint against the wrong business and then perhaps even lose their right to file a complaint at all because a statute of limitations expired.

If you already have a registered trade name, remember to sign your agreements in the following manner:

For a Limited Liability Company:

[LLC Name], a [State] limited liability company doing business as [Trade Name]
[LLC Address]*

[Date]
[Signature]
[Name of Signer]
[Title of Signer]

For a Corporation:

[Corporation Name], a [State] corporation doing business as [Trade Name]
[Corporation Address]*

[Date]
[Signature]
[Name of Signer]
[Title of Signer]

*The information in this paragraph can sometimes be found in the preamble of a contract or on the first page of the contract.

If you have any questions about filing a trade name application, please give us a call at (202) 630-6546 or email us at info@legallyprotect.com. We look forward to hearing from you.

DISCLAIMER: This article is provided for educational and informational purposes only. An attorney-client relationship is not formed by visiting this website, commenting on this post, or submitting information through the Contact Us form. The information provided here is not intended to, and should not replace, advice from a licensed attorney in your state. Kimberly Shin Law Firm PLLC disclaims all liability with regard to any and all actions taken or not taken as a result of information contained here.


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