Indeed everything’s bigger in Texas, especially small businesses. A report released by WalletHub (2019’s Best & Worst States To Start A Business) compares all 50 states to determine which ones are best for starting a business in the United States. It confirmed Texas as the overall best state to start a business.
Methodology for the report examined conditions that enable easy and ideal business creation. Some of these factors were capital access, available talent in the workforce, and affordable office space. Texas narrowly edged out Utah with a total score of 61.05 and earned an additional No. 1 ranking in the category of the business environment.
In Texas, all corporations, limited liability companies (LLCs), limited partnerships (LPs), limited liability partnerships (LLPs), or out of state companies that regularly conduct business under a name other than its legal name, are expected to file a DBA with the Secretary of State.
The trade name will have to be filed with the county clerk’s office in the county where the company operates. Sole proprietorships and general partnerships need not file at the state level but will need to file for a DBA in the relevant county clerk offices if they are using a name other than the legal name of their owners.
DBA stands for “doing business as,” which in Texas is also termed the “assumed name.” The DBA is the alternate name under which you will operate your business, as compared to the formal business name registered with the state or your own individual name.
If you are an individual and you want your business to operate under a different name, you can send in a DBA to the municipality’s clerk’s office where your company is located. If you have a business that wants to do business with a different name than its officially incorporated legal name, then you also need to file a DBA.
To register your assumed name, you are expected to obtain, complete, and submit an assumed name certificate to the county where you conduct business. The county clerk’s website more or less provides the required forms, which request information such as the assumed name you’ve chosen, the address of your principal place of business, your name, home address, and how long you plan to use the DBA.
In Texas, your assumed name does not have to be unique. You can have the same assumed name as another business; nonetheless, it is advisable to check for businesses that have already filed under that name. Having an identical or similar DBA could create confusion and risk legal issues.
Also note that you can select how long you want your assumed name registration to last, and the duration can be up to 10 years. Unless you renew it prior to expiration, your assumed name expires after the selected duration.
If you stop using your assumed name before it expires, you are expected to file a Statement of Abandonment or Withdrawal. If anything about your assumed name certificate changes throughout the 10 years, you will also have to file an entirely new assumed name certificate that includes the changes.
Step By Step Guide to Filing a DBA in Texas
For sole proprietorships and general partnerships, a DBA enables you to use a name other than the owner’s personal name. For limited liability companies and corporations, DBAs allow you to use multiple names to officially refer to your business activities. However, there are many different reasons for Texas companies to acquire ‘doing business as’ names, and here are the steps required to file them.
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Ensure Your Desired Name is Available
Note that you have to do this before you fill out any paperwork. Although multiple businesses can use the same assumed name legally, you probably want an original name that no one else is using. Pick a different name if the one you want is already in use to avoid trademark infringement and consumer confusion issues down the line. Also, run a trademark search to be sure that the name is not trademarked.
Registering the DBA name does not allow you to use the name if doing so would infringe on someone else’s legal rights to the name. To search online, visit the state of Texas’s SOS direct website and request an account. Each search you run will cost $1. You can also visit your county clerk’s office in person and ask an employee to check the name’s availability. They may charge a small fee.
Get an Assumed Name Certificate Application
In Texas, this is called “Form 503: Assumed Name Certificate.” To acquire this document, visit your county clerk and pick up a form in person, or visit the Secretary of State Website to download it. Note that the downloadable version of the form is a PDF (portable document format) file. You may have to download software that will let you open it on your computer. Once you’ve opened the application, print it so you can fill it out.
Fill out Items 1-4 on the Application
It is imperative that you or your legal representative (such as an attorney or registered agent) fill out the form correctly and honestly. Items 1-4 require you to provide:
- The assumed name you want to use.
- Basic contact information of your business. This should be the address where your business receives mail, not your personal address
- The structure of your business
- Any file number that is already assigned to your business. To find out if you have a file number, call the Secretary of State’s office or look on SOS online under your business’s legal name.
Complete Items 5-8 on the Form
Have it in mind that this section of the form requires you to provide:
- The jurisdiction and address of your main office, if different from the business location you are filing for. This does not have to be in Texas.
- The office address for your business’s main location in Texas, if your main office is not in Texas.
- The duration that you will be using the assumed name for. The maximum duration is 10 years, although the form can be renewed at the end of this time.
- The county or counties where the assumed name will be used.
Notarize the Form
Note that a licensed notary is an unbiased outside party who verifies your identity, makes sure you’re not being forced to do anything against your will, and confirms that you understand what the document says. Therefore, you will need to have your signature on the application notarized before it will be accepted.
Submit the Form
After signing the application and having it notarized, send it to the Secretary of State’s office. The Secretary of State’s address is: P.O. Box 13697, Austin, TX 78711-3697. Include a $25 fee with this application, either as a check or money order.
Also, note that you can either file it at the county where your business has its “principal place of business or a registered office in Texas if the business’s principal place of business is outside the state. To find a county clerk’s office, visit the Secretary of State’s website.
If you prefer to mail the form, scan or photocopy it and retain a copy for yourself. Make sure to include your payment with the application. Submitting the application in person is useful if you have questions. The employees at the county clerk’s office will check your forms to make sure everything has been done correctly.
Order a Copy of the Approved Form
After your form has been approved at the county clerk’s office, you want to ensure you have the proof in your files. If any problems arise in the future, you’ll have an official copy in your records to defend yourself. Counties often charge a fee for this service, but you should always do it. It’s better to have that peace of mind than save a few dollars.
Renew the DBA When Necessary
Also note that your DBA certificate is valid for 10 years after you file it. You can renew within six months of its expiration date. If you don’t want to use the assumed name anymore, you are expected to file a certificate of abandonment, which is Form 504. Note that you cannot amend a DBA certificate. If you want to change the name of your business, you must fill out a new form.
Doing business as, or DBA for short is one of the most simple business filings for Texas entrepreneurs. The process to acquire one is quite easy, and you can begin using your new assumed name as soon as the state completes your filing.
If you’d rather not fill out the paperwork and register for a DBA yourself, there are plenty of reputable companies offering a service. For a fee, these services will assemble the relevant paperwork and submit it to your state, and all you have to do is supply them with some basic information. Hiring a DBA service can save you some time, and it may be worth the cost.