Once you’ve settled on the perfect name for your business and have verified its availability, the hard part may be over — but you’re far from ready to open your doors and begin taking customers. You still might have to file the necessary paperwork and progress through the legal channels to register your fictitious business name.
We know, we know…you’re probably just glad to have gotten this far, past the various types of business names you considered as the right fit for your Limited Liability Company (LLC) or other type of business. So today we’ll take a closer look at what a fictitious business name statement is, why you might need one and how to get it.
What Is a Fictitious Business Name Statement?
A fictitious business name is used primarily for operations — a separate name from the one you filed under legally, which you might use as the public name of your company for sales and marketing purposes. You need to be proactive when it comes to safeguarding your fictitious name’s legal standing, which you can do by filing a fictitious business name statement. Some states may have certain restrictions in play for what terms can be included in a fictitious business name.
How to File a Fictitious Business Name Statement
Whether you’re the sole business owner, part of a team or have some other arrangement, the fictitious business name statement is a critical part of securing your company’s future. But don’t be intimidated by that lengthy term. All this statement really does is legally bind together your business, your selected name and its owners.
Where to Go
Your journey to file a fictitious business name statement should begin in the county where your main business address will be located. As with the rest of your company’s paperwork, it’s critical that you connect with the county clerk, the city or even your state secretary of state’s office to confirm that you’re filing your fictitious business name statement in the right district. Often, states will require that you complete this step within a specific timeframe after kicking off your business. If you’re planning on conducting business in multiple counties, consider repeating this step in each of them.
What It Costs
Filing fees for a fictitious business name statement can reach as high as $100, so don’t forget to factor this amount into your startup expense sheet. Many states take it one step further, requiring you to publish a statement of intent — usually in the form of an advertisement — in a local newspaper prior to filing the statement. Check with your county clerk for clarification on what you need to include and any restrictions that may apply to the process. Then you can present the newspaper ad to file when the time is right.
Why You Should Start Now
Because every state has a different set of rules, you should always begin your research early, treading carefully so you don’t compromise your business’ future. Some states will restrict the words in your business name to minimize misrepresentation and confusion, while others may not require a separate fictitious name unless you want to operate under a name different from that of your corporate filings. Many sole proprietorships and partnerships may not need to file for a name at all.
Who Needs a Fictitious Business Name Statement?
Now that we’ve laid out some of the basic need-to-know details about filing a fictitious business name statement, you might still be wondering exactly why all this time and effort is really necessary. Let’s delve into a few reasons why you absolutely want to file one in a timely fashion if your state requires it.
- If you’re hoping to open any kind of bank account in your business’ name, you need to register it before any financial institutions will allow you to do so. You’ll need to present your name statement if you have any checks you need to deposit relating to your business.
- The paperwork you file early on in the lifespan of your business is often intended to lay a solid foundation you can build upon for years to come. That’s why you want to ensure that you file your statement, retaining exclusive rights to your selected business name within the county where you registered it.
- Part of the benefit of incorporating your business — and all that entails — is the legal protection it provides. However, without a current name statement on your side, you won’t be able to take any legal action for the sake of your business.
- Your fictitious business name statement also functions as a show of good faith for your customers. The filing essentially connects your business and its name to you by law. As such, your statement presents a basic level of transparency, holding you accountable and testifying to your commitment to sound, ethical business practices.
When You’re Ready
Consider your fictitious business name statement a sweeping declaration of your company’s mission. Symbolically, it’s a promise to strive for the greatest impact you can with your business, as it anticipates that you intend to do whatever is required to live up to the name you’ve so painstakingly selected. What happens from there depends on you, but remember that your company’s name often shapes the first impression others have of your business.
At Incfile, we’re determined to help propel business owners down the best path for your company. With the right tools on your side (and our extensive resources), you’ll have a plan in place for whatever the future may bring. If you need to form your business legal entity or file a fictitious business name statement, reach out so we can help manage your company. To learn more, check out our website and get started today!