Yes, a DBA can have multiple owners as long as the business is not structured as a sole proprietorship. For most people who use a DBA, it means that they are operating as a sole proprietor. For instance, Mary Moore operates as a sole proprietor graphic designer, and she decides to do business as: “Mary Moore Designs.”

In that case, for a sole proprietor, the DBA is an extension of the natural person. But if you are operating as an LLC or corporation, then the company and DBA are treated as a separate legal entity that is different from the person or people who own it. There may be other individuals on such an account as authorized signers, but not as account owners.

If you’re looking at two individuals who together own and operate a DBA, the business structure will have to be a partnership, LLC, or corporation, depending on the business form they have chosen, unless state law permits them to jointly operate as a sole proprietor.

In the U.S., a DBA lets the public know who the real owner of a business is. The DBA is also referred to a fictitious business name or assumed business name. When someone files a DBA, it is circulated in some kind of newspaper (maybe you’ve noticed all those “fictitious business name” entries in the local classifieds). It lets the community know exactly who is behind a business.

There are two primary situations where business owners would want to use a fictitious business name or DBA. If you are a sole proprietor or cofounder of a partnership and you want to do business with a name that is different from your personal name, you can register a DBA.

It gives your business a certain marketing identity that is separate from your personal name, but it’s not the same as a corporate structure in the eyes of the law. If you have already set up a business structure and incorporated, but you want to use a different business name other than the name of your corporation, you can register a fictitious business name.

In the United States, registering a DBA is typically straightforward. To complete this process, you need to complete a form and pay the filing fee. There is technically no DBA name limit, each name needs to be filed separately.

Indeed you are allowed to register as many DBAs as you want, but there are associated filing costs. Howbeit, filing multiple names may be unnecessary based on your company’s needs. In addition, when a business has two open DBAs, this can make bookkeeping more challenging.

Since each DBA is not a separate business, the IRS will view both DBAs as a single entity. This can make it difficult to claim losses for one DBA when the other DBA is making money. Aside from tax time becoming more complex, multiple DBAs can also increase liability concerns.

Important Factors to Consider When Filing a DBA

In the United States, the rules, requirements, forms, and fees associated with filing a DBA tend to be quite different in each state and county. The U.S. SBA provides a chart that explicitly states DBA filings state-by-state.

In some states, sole proprietors and general partnerships file in one office while corporations, LLCs, and other statutory entities file in another. The DBA forms may differ as well. The time it takes to process a DBA also varies. It’s best to learn how your state or county operates. Nonetheless, here are some additional information on filing a DBA:

  1. Good Standing

If you’re incorporated or have an LLC, you may be expected to provide proof that your business is in good standing. You can request a Certificate of Good Standing from the secretary of state. There are so many businesses that will prepare and file the necessary forms for you.

  1. You Can’t Use Inc. or Corp.

Always note that you are not allowed to add Inc. or Corp. to the end of your DBA (e.g., Green Thumbs McGee’s, Inc.) if your business is not incorporated. The same goes for an LLC.

  1. Announcing Your DBA

Have it in mind that you may be asked by your state or county to announce your DBA by putting an ad in a local newspaper so the public can be made aware of your filing.

  1. Changes You Make May Impact Your DBA

Notably, if any information in your DBA filing changes (e.g., you incorporate or become an LLC, relocate your business or appoint a new partner, officer, or member), you are expected to revise your DBA. Some states also mandate businesses to file an amendment. Others require a whole new registration. Be sure to keep your DBA up to date.

  1. Think Twice about Skipping the DBA Step

If this all seems like a daunting task, and you want to go ahead and use a fictitious name without registering, think again. Note that it is illegal to run a business under a non-registered, assumed name. Some states impose harsh penalties for failure to register a DBA name, including civil and criminal.

However, the only means to make the DBA filing process easier is to hire a legal document filing service to help make sure that you’re following your county and state requirements perfectly. Whatever method you choose, you won’t be able to begin using your DBA until you receive a fictitious name certificate.

  1. Payment and Filing Methods Differ

Payment and filing methods for DBA also tend to vary by state/county. Some allow you to pay by debit or credit; some require a money order or cashier’s check. Filing can be done online in some states while others want you to mail notarized documents to their offices. Check with your state/county office to be sure.

  1. Consider Applying for an Employer Identification Number

In addition, to avoid using your social security number to identify your business, consider applying for an employer identification number. This helps keep your personal and business matters separate.

  1. DBAs Need to Be Renewed

In some states in the United States, a DBA registration is expected to be renewed every five years or so. Make a note to file for renewal before it expires so you can continue to legally operate your DBA.

Conclusion

Using a DBA name for your business is better than nothing — it gives you a more “official” business name that you can put on business cards and on your business website. It helps give your business an identity that is separate from simply doing business under your own name.

However, if you already have an LLC or other corporate structure for your business, a DBA can be a useful way to expand your services or change your business name without losing the existing business entity.

Joy Nwokoro