- Hi everyone.
I'm attorney Aiden Durham with 180 Law Co. in Colorado,
and you are watching All Up In Yo' Business.
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On this episode of All Up In Yo' Business,
we're gonna talk about DBAs
and the proper way to use a DBA with your business.
But first, don't forget to like,
subscribe, and share, and be sure to check the description
for links to additional information and resources,
including my new business checklist,
which you can download for free.
All right, so first off, what is a DBA?
DBA stands for doing business as.
Some states use different names or terms for DBAs.
Colorado, for example, calls it a trade name.
Some states call it a fictitious name or an assumed name,
but overall a DBA, trade name, fictitious name,
whatever you wanna call it, it's all pretty much the same.
Registering a DBA or a trade name
is not the same as registering a trademark, first off.
Trademark rights apply to DBAs in the same way
that they apply to any other business name or brand,
but registering a DBA or a trade name
doesn't confer any of the additional rights or benefits
that you would get from registering a trademark
with the United States Patent and Trademark Office,
or even a trademark registration with your state.
Again, every state is different,
but typically we would register a DBA
by filing some kind of form with the secretary of state
in the state where your business is located or registered.
In Colorado, we would file a statement of trade name
to register a DBA or a trade name.
If we were registering a DBA
for a sole proprietorship in Colorado, we would use a form
called Statement of Trade Name for an Individual.
This is because a sole proprietorship
is technically the individual,
so it is a trade name of an individual.
If we were registering a trade name
for a general partnership, we would use a form
called Statement of Trade Name for a Non-Reporting Entity.
This is because a general partnership isn't required
to be registered with the state,
and therefore it's considered a non-reporting entity.
If we're registering a DBA for an LLC or a corporation,
we would use a form called
a Statement of Trade Name for a Reporting Entity,
because those entities are required to be filed
and formed with the secretary of state,
and therefore they are considered reporting entities.
Again, that's just what Colorado calls them.
Each state's forms
are going to be called something a little different,
and they're not all necessarily gonna use
the term trade name or DBA.
And frankly, I don't know if every state
has separate forms for individuals versus reporting entities
like LLCs, non-reporting entities.
Basically, every state's a little different.
So why would we use a DBA or trade name?
In most cases as a business, you would use a DBA
if you're going to do business as a name
that's different from your business' legal name.
If you're operating a business as a sole proprietor
or general partnership, then you can register a DBA
so there is record of the name
that you're doing business under.
For example, if you are a business coach
and your name is Sarah Johnson,
and you do business as Sarah Johnson,
then you can register a DBA for Sarah Johnson,
or you can register a DBA
for Sarah Johnson Business Coaching or SJ Business Coach,
or whatever name you're gonna do business under.
The DBA doesn't have to include your personal name.
I was just using that as an example, of course.
Whatever you want your business name to be,
that can be the DBA, assuming it's, you know, available
and you're legally allowed to use that name, of course.
There's no real legal benefit or legal protection
that you get from registering a DBA in that instance.
It's not the same as filing or forming an LLC
or getting a trademark registration, for example.
But if nothing else,
you get a registration for that business name
with the secretary of state's office
so, you know, if another company is thinking
about registering a business
for that same or a similar name,
they'll at least see yours there
in the secretary of state's database.
And, you know, they'll know that you exist
and maybe they'll, I don't know,
decide to change their name to something else.
But the point is, it's just getting it registered there.
But registering the DBA or trade name
doesn't give you any additional protection or rights,
other than what you might already have just by virtue
of using that name for your business.
You also don't need to worry about keeping
your business separate from you like you would with an LLC.
In an LLC, it's important that you have
a separate business bank account, for example.
That doesn't really matter
if you're operating as a sole proprietorship under a DBA.
You certainly can have a business bank account for it,
and in fact, I think it's, you know,
generally a good idea just for good business practice
and the sake of knowing
what your business' numbers look like
and for business operations, but you don't have to.
You're not at risk of piercing the corporate veil
because there is no corporate veil to be pierced.
You're already personally liable for anything
with regard to the sole proprietorship,
so you don't really have anything that you need to avoid.
If you're operating a business as an LLC
or a corporation or some other kind of legal entity,
then you can use the DBA or trade name
if you're going to do business under a name that's different
from the LLC or corporation's name
that's registered with the secretary of state.
For example, my LLC is registered as 180 Law Co. LLC,
and I do business as 180 Law Co. LLC,
so I have no need for a DBA.
But let's say I wanted to open up a second location
of my business in my state,
but just for fun, I want to brand it under something else.
Maybe instead of 180, I wanna call it 360 Law Co.
In that case, I can register a trade name
under my LLC for 360 Law Co.
So in other videos where I talk about LLCs
and avoiding the risks of LLCs
and piercing the corporate veil,
I mention how it's important to use the LLC
or similar designation because your customers
and the people that your business is dealing with,
they need to be aware that they are dealing
with a limited liability company.
On contracts and other legal documents,
it's important to include that entity designation,
whether it's LLC or LTD, limited, whatever it is,
important to include that on those documents
so it's clear that it's the LLC
that's entering into that agreement.
But that doesn't mean you have to always use LLC
in the name all the time.
You can, if you want to, but you don't have to.
You don't have to include LLC in your logo, for example,
or on marketing materials all the time.
If it just doesn't look right, or for whatever reason
you don't want to include LLC in there, that's okay, too.
And in that case, just because you occasionally
don't include LLC in the name
doesn't mean you have to register a DBA
for that same name without the LLC.
It's really more about if you're doing business
under a name that's different than your LLC
or corporation's name that's registered with the state.
If you want to create different brands
or different lines of business, all within your one LLC,
then that's a great use of a DBA or trade name.
You can operate multiple businesses,
multiple lines of business, multiple brands
under one entity.
But like I mentioned earlier,
it's important that the people and businesses
that we're dealing with know that they're dealing
with a limited liability company.
So that's why it's really important
to register the DBA or trade name for your LLC
so that if a customer, you know,
goes to look up your business' information
with the secretary of state, they'll see it,
and, oh, this is a DBA of this LLC.
I'm dealing with an LLC, not an individual.
Again, using my company as an example,
my business name is 180 Law Co. LLC,
but if I wanna brand maybe certain services
or something as a separate line of business,
maybe create a separate website under this different brand
for some specific services that I offer,
I can do that and register a DBA
under my LLC for that other brand.
However, the important thing to remember here
is that a DBA does not create a separate business
or a separate legal entity.
It's still part of the one LLC.
If you operate multiple lines of businesses
with different DBAs under one LLC,
they're all going to share liability
because it is still just one business.
So if the LLC gets sued as a result
of one of those lines of business,
it's the LLC that's getting sued, not just that one DBA.
The DBA isn't going to separate that one line of business
or protect it from the liability that might arise
from those other lines of businesses.
So, you know, because of that,
sometimes it's a better idea to create
separate entities altogether
if we're dealing with multiple types of businesses
or for operating multiple businesses
and we don't want them to all share liability
and put each other at risk.
So since it's not a separate entity,
you don't need a separate EIN for a DBA or a trade name.
You don't have to have a separate bank account for each DBA.
You don't need multiple operating agreements for each DBA.
It's all still technically one business
and you are simply operating or doing business
as one or more different names.
You certainly can have a separate bank account for one DBA
or keep separate accounting records
for your different DBAs in different lines of businesses,
but again, you don't have to.
You won't be putting yourself at any added risk
of piercing the corporate veil or personal liability
if you treat all the DBAs as one business,
because technically, legally,
they are all still one business, the LLC
or corporation.
But going back to what I said a minute ago,
it is still important that other people
that your business is dealing with
know that they are dealing with an LLC or a corporation,
or whatever kind of entity your business is.
That's why, again, it's important to register the DBA
under the LLC to give notice to everybody
that if you're dealing with this DBA,
you're actually dealing with a limited liability company.
And so in that same vein,
if you are operating under a DBA,
any contracts or legal documents need to make it clear
that it is a DBA of an LLC.
So in your service contracts,
independent contractor agreements,
contracts that you might sign with suppliers and vendors
it should say something like LLC name, DBA, DBA name.
If my LLC is 180 Law Co. LLC,
but I'm doing business as 360 Law Co.,
then my contracts would say 180 Law Co. LLC,
DBA, 360 Law. Co.
You don't always have to do that.
You don't have to have your logo include the LLC name,
followed by the DBA name, for example,
and you don't need to brand your website
as LLC name, DBA, DBA name.
You can just use the DBA name on its own.
That's really the point of the DBA.
But your website terms of use or terms and conditions,
since those are legally binding agreements,
it's wise to make it clear that the website
is owned and operated by an LLC
which is doing business under a DBA or a trade name
so that way when your website visitors
read your terms and conditions,
which I know we all do all the time,
anytime we visit a new website,
they'll know that this website and these terms
that we're agreeing to by visiting the website
is an agreement with a limited liability company.
So in summary, a DBA or trade name
is typically used to register the name
of a sole proprietorship,
or if you're operating a business entity
like an LLC or a corporation
and you're gonna do business under a name
that's different from the registered name
of the LLC or the corporation.
At DBA by itself does not provide
any sort of legal or liability protection,
and doesn't need to be treated as a separate business
for purposes of avoiding piercing the corporate veil
or anything like that.
That's all for this episode, folks.
Drop a comment below, let me know what you think.
And again, don't forget to check the description
for links to additional information and resources.
Thank you all so much for watching.
I'm Aiden Durham, and I'll see you next time.
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