A DBA, or doing business as, name is a pseudonym that a business uses instead of its legal name. For example, the legal name of a sole proprietorship is the owner's name. However, he might call the business ABC Plumbing, which is a DBA name. DBAs are also referred to as fictitious business names, or FBNs. Getting a DBA means registering it with the appropriate government entity. In some states, like California and Florida, registration is legally required.
How to Get a DBA
The first thing you need to do to get a DBA name is to choose a name and make sure it is not already in use. DBA names are usually registered with the secretary of state's office or your local county clerk's office. These agencies typically maintain a public listing of current DBA names that you can check online or in person. You may not include terms like Corporation or Inc. unless the business is legally organized as a corporation.
You must fill out an application form, have it notarized and pay a fee to register your DBA. In some states, you also have to publish the DBA name in a local newspaper.. Registration only applies to the jurisdiction in which the business operates. If you do business in other areas, you will need to register the DBA name there as well.
Is a DBA Different From an LLC?
A limited liability company or LLC is a specific type of business structure. Unlike a sole proprietorship or partnership, LLCs are separate legal entities. The name of the LLC as listed on its articles of organization is its legal name. The term Limited Liability means that the business owners are protected from personal liability with respect to the LLC. By contrast, a DBA is not the legal name of the business and it provides no liability protection for the business or its owners.
Do You Have to Pay Taxes on a DBA?
All business pay taxes when they earn a profit. If you own a sole proprietorship or you are a partner in a business, you report business expenses and earnings to the IRS as part of your personal tax return by completing Form 1040, Schedule C. Record DBA names in section C of the schedule C form. LLCs use IRS Form 1065, and corporations file Form 1120. However, all business entities use their legal names on the tax returns. A DBA does not affect a tax return and incurs no additional tax liability.