What’s in a name? Well, it’s only your biggest asset in the business world.
Registering your business name, in addition to fulfilling a legal requirement, affords you certain protections and establishes your credibility in the eyes of potential and current customers, partners, and employees.
Precisely why it’s one of the most crucial factors to consider when starting your business.
Although the process may seem straightforward, you must consider several factors, such as availability, business structure, geographical area, and the extent of protection you need.
As someone with decades of experience, I know exactly what goes into choosing and registering an attractive business name.
Read on as I break down every step in detail.
The Easy Part of Registering a Business Name
Your business name will be on everything—from business cards to stationary to loan documents to future contracts and agreements.
It’ll be your permanent identity. Prospects, partners, and other people will connect your business name with you and what you do.
Naturally, you want to protect such an important aspect of your business. Once you register it, that particular name goes off the market, and no other company in your state can launch a business using the same name.
The obvious benefit of this is your customers, vendors, and the general public won’t get confused between your enterprise and others. Furthermore, if you go a step further and trademark the name, you can sue other businesses for trademark violation if they try to use your registered name.
You’ll essentially hold the exclusive right to your business name.
What’s more, the process of registering a business name is very simple. There are specific databases to check availability, and then based on your business structure, you can file the required paperwork to acquire the name you like.
You can also file a Doing Business As or DBA to do business under a different name within the same company.
You could also choose to use a business formation service, such as IncFile, to help you form and register your business. This top-rated service provides formation services (LLC, S corp, C corp, nonprofit) and will answer all your questions on business structures, file all relevant paperwork for you, and the articles of organization and operating agreement—for very affordable rates.
The Difficult Parts of Registering a Business Name
Although the process is straightforward, it can be extremely tedious and time-consuming. You’ll find yourself checking all kinds of databases, sourcing and filing paperwork, and making difficult decisions.
You also need to be aware of the different processes and state-specific requirements regarding naming a business, making things slightly confusing. Of course, if you have the right guidance, it will be easier.
Moreover, registering a business name isn’t free. You’ll find yourself paying all kinds of fees—to a business formation service (if you choose to work with one), trademarking, and securing the necessary paperwork.
That said, the cost varies between $10 to $200—to even $500, depending on your corporate structure. So the charges don’t need to always be heavy on your pocket.
Nevertheless, the pros of registering a business name far outweigh the cons. Keep reading as I deep dive into the different steps of business name registration.
Step 1: Check Business Name Availability
Your business name has to be unique and appealing enough to attract your target customer‘s attention. More importantly, it should be available and not reserved by anyone else in your state.
From checking business name availability to searching federal trademark records, there’s a lot that goes into zeroing on a good business name.
Do a General Web Search
Although many expert guides suggest doing a general web search after checking state and federal databases, I think it should be the other way around.
Think about it: why take the pain of doing all those elaborate searches when your name is already taken—or if there’s a business with a very similar name that may cause you legal trouble down the line?
Check the internet to see what comes when you search a prospective business name on popular search engines like Google, Yahoo, Bing, and social media platforms like Facebook, Instagram, and Twitter.
This will give you a better idea about the availability and whether any other business that pops up when you search the name has a significant online presence—and how tough it’ll be to compete with them when building your brand.
Do a State-Level Business Name Search
You’ll start with a business entity name search. You can do this on your Secretary of State website, where you learn whether the name you want to file is already taken. If it is, your filing will be denied, but if it isn’t, then congratulations! You have a new name.
You’ll do business name searches at several points:
- When filing for formal business structures like corporations and LLCs
- When filing a name reservation for an LLC or corporation before filing
- When filing a DBA (Doing Business As) for an existing—formal or informal—business
In certain states, you don’t have to do a state-level name search if you plan on forming an informal business structure (general partnership, sole proprietorship), but some states are more stringent as well. It’s best to know the rules and regulations for every state when choosing a business name.
Do a Domain Name & Social Media Search
Having a social media presence is an incredibly important aspect of business success, and your business name is an equally important part of that persona. Precisely why I highly recommend checking whether your business name is available as a web domain (URL) and as usernames on popular social media platforms.
Even if you don’t plan to make a business website right away (again, you should do this ASAP!), you can buy the domain address for future use. This will reserve it for you, preventing others from acquiring it.
What’s more, this step is free of cost. So no reason why you shouldn’t take this extra precaution, right?
Search the U.S. Trademark Electronic Search System
Part of checking business name availability is also performing a quick search on the U.S. Trademark Electronic Search System. This will tell you whether any other business has already trademarked your name for future use. Once you’re sure your prospective business name is available, you can decide to apply for a trademark.
Disclaimer: The cost of registering a trademark is high, so it may not be within your budget if you are a start-up or a growing business. Nevertheless, it’s best to be certain that you’re in the clear even if you don’t plan on applying for a trademark.
Step 2: Find Out Your Business Naming Requirements Based on Your Chosen Business Structure
At this stage, you know the unique name you want for your business. Next, I’ll tell you what you need to do with one.
Your naming needs will differ based on your chosen business entity. Deciding the best business structure for your new venture is an essential step because each corporate structure has different advantages, disadvantages, and naming rules. If you’re using one, IncFile or other business formation services will be a massive help for this step.
Depending on whether it’s formal or informal, your choice of business entity also influences the way your business is set up, operated, and taxed. Below, I’ll discuss the naming requirements for each business structure to give you a better understanding of how everything works.
Limited Liability Companies (LLCs)
An LLC is the most straightforward way of structuring your business out of all the business structures to protect your personal assets against legal claims.
You need a unique name for your company that adheres to specific naming requirements, such as:
- Your business name should include some version of “limited liability company.” You can use the whole phrase, a shortened version, or one of the abbreviations LLC or L.L.C.
- If your business name includes restricted words like Bank, University, or Attorney, you have to file additional paperwork and a licensed individual (lawyer, doctor, and so on) to be a part of your LLC, and it may actually be required to be a PLLC.
- Your business name shouldn’t include words that may confuse people with a government agency, such as Treasury, FBI, and State Department.
You can also adopt different approaches if you plan on registering a name for an LLC. For instance, you can reserve your name if you’re in the process of opening an LLC, file a DBA if you want to operate under a different brand name, or submit an amendment to change your LLC‘s legal name.
Each of the above approaches is an elaborate process in itself. To avoid making any mistakes, I advise working with a reputable business formation company to handle all your paperwork and other business requirements.
Sole Proprietorship
Similar to LLC, a sole proprietorship is very straightforward.
It’s an informal business structure that doesn’t provide you any personal asset protection, which is why you don’t have to file your business with the state. However, sole proprietorships must operate under the owner‘s surname.
If you want to use a different name, you’ll have to file for a DBA. Since naming requirements vary on the state level, you should check the requirements for your state before proceeding.
General Partnerships
General partnerships and sole proprietorships are under the same category of informal business structures that don’t extend to personal asset protection. The only difference is that while a partnership consists of at least two people, a sole proprietorship is you solo.
If you plan to enter into a partnership, your business name will have to include the partners’ surnames. Again, you can file a DBA if you want to use a different name. Make sure you find out the naming requirements for the state you plan on operating from.
Corporations
A C Corporation or C-Corp is a separate legal entity from its owners and comprises shareholders, board of directors, operating officers, and employees. The good thing about forming a corporation is it protects your personal assets.
You need a unique business name that meets predetermined naming requirements for a corporation. This includes the following:
- Your business name must have ‘Corporation,’ ‘Incorporated,’ ‘Company,’ or ‘Limited’ in the name. Alternatively, you can also have an abbreviation of any one of these terms.
- Your business name shouldn’t include words that may confuse people with a government agency, such as Treasury, FBI, and State Department.
- Your business name should be unique and distinguishable from any existing business in your state.
Like in LLCs, corporation naming scenarios can be different depending on whether you’re already in business or just starting out. For instance, you can reserve your name if you’re just forming a C-Corp, file a DBA if you’re an existing corporation, or submit an amendment to change your C-Corp‘s legal name.
Step 3: Register Your Business Name
This is the final step of your business naming process. It’s also the most elaborate, where you have to consider several factors, ranging from state-specific registration requirements to filing necessary paperwork depending on your business enterprise.
Below, I’ll outline how to register the business name based on different actions.
When You File a Name Reservation
Although name reservations aren’t a requirement in most states, certain hard-to-miss benefits make it worthwhile. For instance, if you like a name but don’t want to form an LLC or a corporation right away, you can reserve it to prevent other businesses from acquiring it.
Keep in mind that the procedures to reserve a business name varies from one state to another.
When You File a DBA
Filing a DBA permits you to carry on your existing business under a different name than your legal business name. DBAs can be particularly helpful for establishing a brand name or changing the name of a business without filing an amendment to the original filing.
You can file a DBA for all the enterprises. But the procedure will vary from one corporate structure to another.
When You Form an LLC
The first few steps of filing an LLC involve registering a business name. Once you’ve filed your LLC in the relevant state, you can consider your business name is registered.
The entire procedure consists of five different steps, namely:
- Selecting a name for your LLC
- Choosing a Registered Agent
- Filing Your Articles of Organization
- Preparing an Operating Agreement
- Obtaining an EIN (Employer Identification Number)
When You Form a Corporation
Forming a corporation and an LLC has several similarities, and registering a business name is one of them. You’ve registered your business name once you file to form a corporation. This involves the following steps:
- Selecting a name for your corporation
- Choosing a Registered Agent
- Filing the initial directors’ and share structure of your corporation
- Filing the formation paperwork
- Obtaining an EIN (Employer Identification Number)
When You Want to Submit an Amendment to the Legal Name
You may want to change the legal name of your business. If that’s the case, you’ll have to file your state’s Certificate of Amendment—or a similar document—for your business entity. In addition to this, you’ll also have to pay a filing fee.
Source: quicksprout
How to Register a Business Name