Once you settle on the type of business structure that makes the most sense, it’s time to make things official and register. Don’t freak out, though. Anyone can do this part, even without a law degree. Registering your business is super easy, relatively fast and user-friendly.
How to Register Your Business
We’ll help you through the process. Each state will have its own online web portal you can use to file for business registration. If your state doesn’t offer online registering of a company, take a trip down to city hall and ask someone at the information desk to help you start the process. Legal representation is optional when filing your business paperwork on your own; however, if something about this process seems intimidating or overwhelming, then it might be worthwhile (and more convenient) to hire a qualified business attorney instead of putting in all that effort yourself!
Google search is the best way to get started. Type in “register my business in” followed by your state name. The first page almost always brings up a link you need to click for your respective state with instructions on how to start registering your new company. Just follow the steps and fill out the fields. It’s quite intuitive.
Before submitting payment, make sure to upload all signed documents and agreements that pertain to ownership on your state portal. Every state has its own registration fees for C-corps and LLCs. Don’t forget that you must renew your company every year in your state’s portal to avoid nasty late fees or even a potential dissolution by default which could result in significant legal issues down the road. Make sure you purchase the additional options for certified copies that the portal offers. These generally come with smaller fees, but it’s good to have copies of all the official documentation.
Now that payment has been made, we recommend downloading the PDF versions of your articles of organization or incorporation. Keep these in a cloud drive as well as hard copies for the office.
The importance of registering for an EIN number cannot be stressed enough. In order to apply for business credit, loans and lines of credit with vendors, you need a federal tax identification number. You can get this essential piece by visiting: https://www.irs.gov/businesses/small-businesses-self-employed/employer-id-numbers.
Registering Your DBA
We can’t very well talk about registering your business and business structures without also exploring your options with a DBA. It really can be a necessity for small businesses just starting out as well as a competitive edge for later down the road. Here’s how it might play out in your scenario.
Brenda initially thought her baking business would be best marketed as Baking with Brenda. So that’s the name she used on her LLC paperwork. But now she’s having second thoughts about putting her name out there. It makes perfect sense for local clients since many of these paying patrons already know who she is. But as she reviews her business plan and strategy and considering bringing in her sister and friend as additional members under an operating agreement, it might make sense to change her name to something a little more anonymous and inclusive of her partners. Again the rule in business, especially when starting out, is to play bigger than you are. Fortunately for Brenda, she can register The Cupcake & Pastry Palace as a DBA and won’t need to create a new LLC.
What is a DBA, Anyway?
A DBA is a Doing Business As. It’s what happens when you establish your business under a different name that doesn’t match your legal name.
A DBA is also commonly referred to as a “Fictitious Name” or “Assumed Name.” This type of registration allows you to operate a business without some of the obligations and liabilities that come with incorporating officially.
Why Small Businesses Would Need a DBA
You can create a DBA for your business, and avoid the costs associated with incorporation and register without publicizing your own name. The primary disadvantage is that the owner of the DBA, without incorporation, would be personally liable for any debts, lawsuits, or claims against the company. As we have mentioned in the past, for the serious entrepreneur, do NOT start your business as a sole prop!
There are plenty of key reasons and benefits behind using a DBA. Here are just a handful that may make sense for your business model.
- It’s the simplest way to register your business name
- It enables you to operate multiple DBAs under an LLC or C-corp. This can be ideal when it comes to marketing different brands that are all owned under the same entity.
- It keeps your business in compliance
- It allows you to keep your personal name more private. (Applies to Sole Proprietorship)
You can get really deep with the DBA conversation and eventually find yourself knee-deep in trademark law talk. But in all honesty, if you’ve done your research and the DBA you want to use has not been filed in your state, then in most cases, you can use it. Always check with your lawyer first!
How to Go About Filing
The first filing step you’ll need to take is to find your DBA filing location. Once you have the information, use your local government website to get step-by-step instructions for filing a name or assumed name. Resources are also available online, making the filing process entirely digital and seamless.
For example, Ryan and his general contracting business are located in Seattle. He opted to start doing business as Dream Bigger Construction to keep his personal name out of the limelight. The first thing he did was visit seattle.gov/incorporation. Under Choose a Business Entity Type, he clicked Create a New Corporation. He filled out the online form with his basic information and submitted it.
Once Ryan receives an email from the City of Seattle with a new corporation confirmation number, he can go to seattle.gov/dba and create a DBA record for Dream Big Construction. The site will take him through the steps to enter his information and pay a $15 fee. His DBA will then be official.
If you’re taking these steps, be sure to print out the certificate of filing once it’s ready.
You can also establish a DBA after you’ve set up an initial LLC or C-Corp, too. A quick visit to the courthouse with your documentation and to your bank will get you set up.
That’s It, Understanding the Basics of a DBA in a Nutshell
A really good time to register as a DBA is when your business first begins. It will be one less task to worry about once the business becomes more established. DBAs can be smart steps in your business startup process and are definitely worth considering right now.
Hopefully this short, but informative article has cleared up many questions in regards to the use of a DBA. It’s really simple, inexpensive, and straightforward to do. We are talking anywhere between $10.00 – $100.00. So if you are in the process of a rebrand or adding a new brand, but don’t want to create a new legal entity, then get your DBA done now.
We’re only a click away if you’re ready for a FREE consultation, too. And to help keep you on the best path for business startup success, keep reading our actionable, no-nonsense tips in this series of blogs!