How to File a DBA in Alabama

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The first thing to understand about a DBA is what it means. It stands for ‘doing business as.’ It is any registered name that a business or person operates under that isn’t its legal name. 

The legal name of a business varies depending on the business structure. For LLCs, it is their company name, and for sole proprietors, it is their individual legal name.

A DBA is sometimes referred to as a fictitious name, trade name, or assumed name. The only thing a DBA changes is your business name.

For example, if you are the only owner, your business’ legal name would be your name. (e.g., Jake John). But Jake John wants to open a car repair shop. He doesn’t want the business to carry his legal name, so he registers his DBA name as Jake’s Brakes. Jake’s Brakes becomes the business name, but it does not change the business in any other way. The DBA allows him to conduct business under this trade name. Without a DBA, his business would default to his own name.

Who needs a DBA?

It depends on several factors, including the business’s legal entity, state and local requirements, and preference for the business owner.

  • New businesses. Some states require a DBA for all new businesses. However, Alabama does not have these requirements.
  • Sole proprietors. Because a sole proprietor and their business are the same entity, it means they have the same name, too, unless they file a DBA.
  • LLCs. DBAs are not a requirement for LLCs. Also, if you’re using your company’s official name, you don’t need a DBA. However, when an LLC expands and wants to operate part of it under a name that is not their official name, it would need a DBA to do it. 
  • Corporations. When a corporation wants to use a different name from the company’s legal name, a DBA is required. Corporations utilize DBAs when they operate various types of businesses in different industries. 
  • Franchises. Franchises use DBAs, too. For example, say you buy a McDonald’s franchise. McDonald’s is formed as an LLC and listed as “321 Business LLC.” You will then want to file a DBA as a franchise to change it to “McDonald’s” to let Alabama know that you’re ‘doing business as’ the franchise you bought into.

Filing for a DBA gives small business owners and startups creative freedom with their business name without having the hefty costs and complexity of registering as LLCs or corporations.

Why do you need a DBA?

  • DBAs remove the hassle of forming an LLC. DBAs are about more than what’s on the sign outside. Filing for a DBA is a more straightforward and cost-effective way for a sole proprietorship to use a new name.
  • DBAs are helpful to LLCs and corporations. A DBA allows your LLC to operate more than one business without forming separate LLCs for every business you purchase. An example – Joe’s Produce LLC runs a restaurant called “Joe’s Deli” and a fresh market called “Joe’s Best Veggies”. Notice that it is two separate businesses under one LLC. It is because two DBAs were filed.
  • Privacy. Sole proprietors and general partnerships use DBAs so that their legal and personal names are not on public-facing material. 
  • DBAs separate you from your business. DBAs don’t provide legal protection by themselves. Your DBA is proof that your business and its assets are separate from your personal assets.
  • DBAs make business banking easier. It is recommended that every business owner opens a separate business bank account from their personal bank account. It is to protect you and your personal assets, including your credit score if your business fails. Most banks require that you file a DBA to open an account in your business name. 
  • Branding and DBAs go hand-in-hand, too. Your business name is what makes the first impression. The business’ brand name on signs, flyers, and business cards should reflect your product and service so that people know what they are coming in for. For instance, if Jake had kept Jake John, no one would know that he had a brake shop.

How to set up a DBA in Alabama

Step 1 – Alabama trade name search

The first thing to do is visit the Alabama Secretary of State Business Entity Search website and name search the DBA name you want is available. A good rule to follow is to check to see if the web domain (URL) you want for your business is available before you settle on a DBA.

Step 2 – Filing your DBA

Alabama has one unique requirement that most states do not have. You must operate under the business name you wish to use in Alabama before registering a DBA and can’t be reserved in anticipation of a future business. To do this, you should register the regular business name. If you want to change it in the future, you can file a DBA in Alabama. Suppose you’re looking to register and protect a business name in Alabama. In that case, you will need to start using it as soon as possible. Alabama requires three ‘specimens,’ or proof, of the business name usage. Your DBA application will ask where and when you first used the trade name. Specimens must not be changed or altered and must be legible. Some of the examples are business cards, flyers, and decals.

Step 3 – Pay Alabama filing fees

You register your Alabama DBA online or by mail with the Alabama Secretary of State. You will not have to have a separate EIN or tax ID for a DBA. When filing for a DBA in Alabama, there are some specific things you will need to know and present.
  • The date you used the business name for the first time in any state.
  • The date you first used the business name in Alabama.
  • A statement claiming ownership of the DBA trade name. 
  • A brief description of your business.
  • How you will use the trade name.
  • A copy of the federal registration if a federal trademark registration already exists.
Office address: State of Alabama Office of the Secretary of State Trademarks Division 11 South Union St., Suite 224 Montgomery, AL 36130 Mailing address: State of Alabama Office of the Secretary of State Trademarks Division P.O. Box 5616 Montgomery, AL 36103-5616

Alabama DBA name restrictions

Before settling on a DBA, review Alabama requirements. Your trade name can’t include the following:

  • Bank-related words. unless there is a letter and permission granted from the Alabama Banking Commissioner’s Office.
  • Insurance-related words. unless the Alabama Insurance Commissioner’s Office grants permission.
  • Words that might confuse your business with a government agency. such as the FBI, Treasury Department, Secret Service, etc.
  • A professional designation such as a lawyer without a copy of the license or lettering from the governing agency.
  • Words that may imply that your company engages in business that isn’t authorized by law.

Forms needed to file a DBA in Alabama

Alabama DBA tax considerations

When you get a DBA in Alabama, it does not affect the tax status of your business.

How much does a DBA filing cost in Alabama?

In Alabama, the DBA cost is $30.

The Alabama state filing fees are the same when you renew every five years. There are professional services that will help you with the entire process. The pricing varies between services with the average being $99 for DBA filing services.

Professional DBA filing services

  • ZenBusiness: ZenBusiness is an affordable solution for entrepreneurs, such as affordable LLC formations, and incorporations. ZenBusiness does offer a stand-alone registered agent service for $99 a year.
  • Swyft Filings: Swyft Filings is a quality DBA service. They assign a registered agent to every client, making them a customer favorite. Swyft Filings offers a DBA obtainment package that costs $99 plus state fees.
  • LegalZoom: LegalZoom does it all. The purpose of its design is to be a “one-stop-shop” for small businesses and their legal needs.
  • MyCompanyWorks: MyCompanyWorks doesn’t have the experience that other professional DBA obtainment services have. However, they’ve served thousands of businesses successfully. MyCompanyWorks offers one DBA filing package for $99 plus state fees. You can add a couple of extras for additional fees.
  • CorpNet: Corpnet’s biggest draw is that they have the best customers. It is hard to find a bad review about their DBA obtainment services.
  • MyCorporation: MyCorporation has served over a million businesses over the last 20+ years. Their customer reviews reflect their longevity and success. The cost of MyCorportation DBA services is $99 plus State Fees. The expedited rush service is an additional $100.
  • BizFilings: BizFilings offers entrepreneurs and small businesses services, such as LLC filing and incorporation services.  The starting price of $99 plus state fees for BizFilings DBA obtainment services is pretty standard. However, it doesn’t include a namecheck in states that require them. Alabama does.

FAQs

Alabama doesn’t require a DBA. 

However, banking, branding, and the legal separation of your and your business are all reasons why getting a DBA is a good idea in Alabama. 

A DBA filing is valid in Alabama for ten years and requires renewal. The cost is the same as registering – $30. You can visit the Alabama Secretary of State site to renew your DBA. 

After five years, a DBA in Alabama will expire without renewal. If you want to cancel one before then, contact the Alabama Secretary of State where you initially registered your DBA. Submit the required paperwork and Alabama state filing fees.

You start a DBA for an LLC just like you do for a sole proprietor. Just follow the same steps above.

You start a DBA for a corporation just like you do for a sole proprietor or LLC. Just follow the same steps.

A limited liability company (LLC) is a business entity type. It provides limited liability protection. A DBA (doing business as) business name is just a registered name for your business.

The short answer is no. Your EIN is for tax purposes. Your DBA is your business ‘nickname’. So, you don’t have to have a separate employer identification number for your DBA.

The IRS does not require that you get a separate tax ID number.

In Alabama, you have no limits on how many DBAs you can register, as long as you register them. However, every state and locale has different guidelines.

In Alabama, you must renew your DBA trade name every five years, or it will expire. You will need to pay filing fees and state fees for the renewal.

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