A fictitious business name (FBN) is a trade name for a sole proprietor. They can also be called assumed names or DBAs (doing business as). Most states have rules concerning FBNs and the first rule, of course, is that the name must be registered. Typically, this is done with the county clerk and is handled at the county level.
Each state has a slightly different nomenclature for referring to this process. Popular ones include:
The reason why registering your FBN with the county or state is so essential is because banks will not open business accounts for you in that name unless it’s registered. So the pertinent questions then are: (1) do I need to register an FBN and (2) how do I register my FBN?
There is really only one condition under which a sole proprietor would not need to file for a fictitious business name. That would be if their full or last name was part of the business’s name. For instance, Johnson’s Collectibles would not need an FBN.
There are two caveats to this, however. If a nickname is used in place in place of a last name, the trade name would need to be registered. Secondly, if the name misrepresents the number of individuals involved in the sole proprietorship, a trade name would also have to be registered. So if the name of the business is Johnson & Sons Collectibles, but Johnson has no sons, then Johnson needs an FBN.
In the majority of states, FBNs are registered with the county clerk. In some states, they’ll be registered with the office of the secretary of state, or perhaps some other state official. Most states have access to this information readily available on the web. The information will include where and how to register your FBN and any fees that may be associated with the process.
There should also be a database of registered FBNs. You’ll want your own FBN to not be the same as an already existing FBN. In addition, you want to make sure that your FBN is not the registered trademark of some other company.
Once the issue of duplicate names and trademarks has been resolved, you’ll be ready to submit your FBN.
There are a number of states that require an individual to publish their FBN in an approved newspaper in order to begin using that name for business purposes. Whoever you filed the name with will provide you with a list of approved publications for this purpose.
The notice will need to be run every day for a specified period of time, usually a week or a month in some states. Afterward, you’ll need to produce an affidavit called a “proof of publication” with the county clerk or whichever state official you filed your FBN with.
After all that, you can start doing business under your fictitious business name!
But you’ll have to renew every five years and significant changes to the business may force you to begin the process from scratch.
Scott Royal Smith is an asset protection attorney and long-time real estate investor. He's on a mission to help fellow investors free their time, protect their assets, and create lasting wealth.
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