Over time, you may decide that the business name you chose for your company no longer accurately reflects your brand. Or you might decide you would be better off legally to have a different name.
Depending on the entity type, the process for changing a business name varies. It can be confusing, so let’s take a moment to break down the options that sole proprietorships, partnerships, LLCs, and corporations have when changing their company name.
While this guide will give you an understanding of what’s involved, it is not a replacement for advice from a lawyer. Changing your business name may have legal implications, so it’s best to talk with a licensed business attorney before jumping into action.
Sole proprietorships and general partnerships
Operating as either of these entities means you have not set up an official business structure with the state. A sole proprietorship or partnership are one in the same entity as their owner(s)—the business name must have the owner’s first and last names in it. However, that doesn’t mean sole proprietorships and general partnerships can’t market themselves under a name that’s more interesting and attractive. They can file for a fictitious business name, also called “Doing Business As” (DBA).
If your business is a sole proprietorship or partnership and you want to change your DBA, you can do so by:
Canceling the existing DBA and filing for a new one. This involves contacting the government authority that approves and registers DBAs, or you might consider using an online legal business document filing service to handle the details for you.
Contacting your bank to find out if the existing business bank account’s name can be changed to the new DBA, or if it will require opening a bank account for the new DBA.
Checking with the county, city, and local government authorities to find out if business licenses and permits must be updated or obtained for the new DBA.
Finding out from the IRS if getting a new DBA will require applying for a new Employer Identification Number (EIN).
Notifying the IRS of the new DBA. The following is from the IRS website:
Sole proprietors: “Write to us at the address where you filed your return, informing the Internal Revenue Service (IRS) of the name change. Note: The notification must be signed by the business owner or authorized representative.”
Partnerships: “If you are filing a current year Form 1065, mark the appropriate name change box on the form: Page 1, Line G, Box 3. If you have already filed your return for the current year, write to us at the address where you filed your return to inform us of the name change. In addition, the notification must be signed by a partner of the business.”
Other Articles From AllBusiness.com:
The Complete 35-Step Guide for Entrepreneurs Starting a Business
25 Frequently Asked Questions on Starting a Business
50 Questions Angel Investors Will Ask Entrepreneurs
17 Key Lessons for Entrepreneurs Starting a Business
Limited liability companies and corporations
Businesses registered as either an LLC or a corporation may change their name using one of two methods. One requires abandoning the original business name entirely while the other maintains the original name and creates a new one for marketing purposes (such as for a new product line).
1. File Articles of Amendment with the state to change the business name
By filing a document called “Articles of Amendment,” an LLC or corporation can request to change the name of the business. When approved, it means your company will operate under its new name. Note: Businesses that have foreign qualified in other states (i.e., are registered in multiple states) must file Articles of Amendment in all those states.
While this takes care of the state records, you may also need to follow through on one or more of the following steps, depending on your situation:
Contacting your bank to find out if you must open a new business bank account for the new name, or if you can change the name on the existing account.
Checking with the county, city, or local government office to find out if they require updating existing business licenses and permits with the new name or canceling the current licenses and getting new ones under the new business name.
Finding out if the business must apply for a new EIN under the new name. (Generally, applying for a new EIN won’t be necessary when changing a business name, but it’s best to check to make sure.)
Notifying the IRS of the new name. Single-member LLCs would do this the same way as a sole proprietorship; multi-member LLCs would handle it the same way as a general partnership. The directions for corporations, according to the IRS website, include, “If you are filing a current year return, mark the appropriate name change box of the Form 1120 type you are using . . . If you have already filed your return for the current year, write to us at the address where you filed your return to inform us of the name change. In addition, the notification must be signed by a corporate officer.”
2. Keep the original name as the registered business name and file a DBA for the new name
It may make more sense for a company to keep its official name intact (e.g., perhaps the business holds a trademark for the name or has built a customer following for the brand) and create a new name for marketing and branding purposes. In situations like that, you can keep your business’s officially registered name while filing a fictitious name (DBA) for the new name with the state or county office (whichever has authority over DBAs).
After filing the DBA, contact your bank to find out if the DBA can be added to your company’s existing bank account or if it will need its own account.
Changing (and using) a business name is no game
Whether filing Articles of Amendment to change a business name or creating a DBA, it’s critical to check that the desired new name isn’t already claimed legally by another business. Using the United States Patent and Trademark Office’s online database can help detect any potential conflicts. I also recommend doing a more in-depth search using state databases; a trademark attorney or online legal filing service can assist with that.
RELATED: 12 Tips for Naming Your Startup Business
The post Changing Your Business Name: A Step-by-Step Guide appeared first on AllBusiness.com
The post Changing Your Business Name: A Step-by-Step Guide appeared first on AllBusiness.com. Click for more information about Nellie Akalp.
To discover more visit: allbusiness.com
