Starting a business is exciting, but it can also be confusing. You want a catchy, marketable name for your business, but what if you’re a sole proprietorship operating under your own name? Or what if you want to launch a new branch of your business without creating a whole new company? That’s where a DBA, or “Doing Business As” can help. A DBA lets you operate under a different name than your official legal business name. Let’s take a look at some of the potential benefits of having a DBA and how to decide if it’s the right move for your business.
What is a DBA?
DBA stands for “Doing Business As.” It’s a registered name that a business uses that’s different from its legal name. For example, let’s say you’re a sole proprietor who structured your business under your name, Sarah Thompson. You want to open a bakery called “Sweet Treats Bakery”. Because that name is different from the legal name of your business, you’d need to register a DBA to use the name “Sweet Treats Bakery” for business purposes. A DBA allows sole proprietors and other business entities to operate under a name that better reflects their brand or services.
It’s important to know that a DBA is not a business structure like an LLC or corporation. It doesn’t create a separate legal entity, and it doesn’t protect your personal assets. It simply allows you to use a different name for your business. It can also be an effective way to build your brand, expand your offerings, and make your business look more professional.
Benefits of a DBA
Here are the general steps to register a DBA in any state:
1. Choose a Name: Make sure it’s unique and fits your brand.
2. Check Availability: Search your local or state database to see if the name is already taken.
3. File with the Right Agency: You may need to file your DBA with your city or town clerk, or the Secretary of State depending on your business type or location.
4. Pay the Fee: Fees vary by location and business type.
5. Publish a Notice (if required): Some states require public notice of your DBA registration.
A DBA can be a smart move for many business owners. It can help you market your brand more effectively and make your business look more professional. But it’s important to understand that a DBA has some limitations and doesn’t offer the same legal protections as an LLC or corporation. Ultimately, whether a DBA is right for you depends on your current business setup, your short-term needs, and your long-term growth goals. If you’re a Massachusetts or Rhode Island business owner thinking about opening a business bank account for a new DBA, BankFive’s dedicated business banking team is here to help.
What is a DBA?
DBA stands for “Doing Business As.” It’s a registered name that a business uses that’s different from its legal name. For example, let’s say you’re a sole proprietor who structured your business under your name, Sarah Thompson. You want to open a bakery called “Sweet Treats Bakery”. Because that name is different from the legal name of your business, you’d need to register a DBA to use the name “Sweet Treats Bakery” for business purposes. A DBA allows sole proprietors and other business entities to operate under a name that better reflects their brand or services.
It’s important to know that a DBA is not a business structure like an LLC or corporation. It doesn’t create a separate legal entity, and it doesn’t protect your personal assets. It simply allows you to use a different name for your business. It can also be an effective way to build your brand, expand your offerings, and make your business look more professional.
Benefits of a DBA
- Provides Brand Flexibility. A DBA gives you the freedom to choose a name that fits your brand. Whether you want something catchy, descriptive, or locally inspired, a DBA lets you market your business in a way that connects with customers—without changing your legal setup.
- Can Improve Credibility. Customers are more likely to trust a business with a name that clearly reflects its services. A DBA can help your business look more established and credible, especially if your legal name doesn’t match what you offer.
- Simplifies Banking and Operations. With a DBA, you can open a business bank account under your trade name. You can also send invoices and communicate with customers using your DBA name to keep interactions consistent and professional.
- Can Lead to Better Marketing. It’s easier to promote a business with a name that matches your brand. A DBA helps you create logos, websites, and ads that reflect your business identity and what you offer. Again, “Sweet Treats Bakery” provides a clear picture of what the business offers, compared to using a personal name that leaves customers guessing.
- Allows for Multiple Business Lines. If you run different types of businesses under one legal entity, a DBA lets you use separate names for each. This helps keep your operations organized and makes marketing more effective.
- You might want to consider a DBA if:
- You’re a sole proprietor and don’t want to use your personal name for your business.
- You’re expanding your services and want a new brand identity.
- You want to test a new business name before forming a separate company.
- You’re currently operating under a name that’s different from your legal name, which may violate local or state laws.
- Registration Requirements. The process for registering a DBA varies by state and locality. In Massachusetts, DBAs must be filed with your city or town clerk if you're using a name other than your legal business name. In Rhode Island, sole proprietors and partnerships file locally, while LLCs and corporations file with the Secretary of State.
- Fees and Renewals. The cost to register a DBA varies depending on your location and business type. In Massachusetts, the filing fee is typically $65, with an additional $35 for non-residents. In Rhode Island, DBA filing fees range from $10 to $50 depending on your business structure and where you file. Some states also require periodic renewals. In Massachusetts, DBAs must be renewed every four years, while Rhode Island does not require renewal once a DBA is filed.
- Legal Protections. A DBA does not protect your personal assets. If you’re a sole proprietor, you may want to consider forming an LLC or corporation for liability protection.
- Tax Implications. A DBA doesn’t affect how your business is taxed. You’ll continue to report income under your main business entity, and no separate tax filing is required. If you're adding a DBA to an existing business, your tax process stays the same as in previous years.
Here are the general steps to register a DBA in any state:
1. Choose a Name: Make sure it’s unique and fits your brand.
2. Check Availability: Search your local or state database to see if the name is already taken.
3. File with the Right Agency: You may need to file your DBA with your city or town clerk, or the Secretary of State depending on your business type or location.
4. Pay the Fee: Fees vary by location and business type.
5. Publish a Notice (if required): Some states require public notice of your DBA registration.
A DBA can be a smart move for many business owners. It can help you market your brand more effectively and make your business look more professional. But it’s important to understand that a DBA has some limitations and doesn’t offer the same legal protections as an LLC or corporation. Ultimately, whether a DBA is right for you depends on your current business setup, your short-term needs, and your long-term growth goals. If you’re a Massachusetts or Rhode Island business owner thinking about opening a business bank account for a new DBA, BankFive’s dedicated business banking team is here to help.