What Does a Fictitious Name Mean?
What does a fictitious name mean? A fictitious name mean is when a person registers a business name to let people know who owns the enterprise.3 min read
2. Fictitious Names and State Law
3. The Objective of Having a Fictitious Name
4. Summary of Reasons for Using a Fictitious Name
What does a fictitious name mean? A fictitious name mean, also referred to as a DBA or "doing business as" name, is when a person registers a business name with the city or county to let people know who owns the enterprise.
About the Fictitious Name Process
A registered or legal name identifies your business and is used by federal and state taxing authorities when filing your business taxes and banks and other financial institutions for legal purposes. A trade name is what is used in advertising or trade purposes. While the term "fictitious business" may come across as a business with illegal practices in mind, that is not the case. The term is used for the registration of businesses in certain situations.
Determining if you need to file a fictitious name depends on whether the business will be operated under an assumed name. For example, John Doe wants to open a business and call it "Super-Size Apartment Movers." Mr. Doe will need to file as a fictitious named business or DBA with the county clerk's office.
If he chooses to name the business "John Doe's Super-Size Apartment Movers," he would not need to file a fictitious business statement because the company name uses his legal name.
Fictitious Names and State Law
A sole proprietorship not using the owner's legal name usually requires that the name be registered with the Secretary of State's office. This may differ in some states, such as Florida, where a legal name can be a person's given name or a properly registered business name. This may include the sole proprietors given name, trademarks, and service marks.
While some sole proprietorships, such as someone working in a freelance capacity, use their own name, others may choose a more creative name. This will need to be registered. There are some variations on whether the filing of a fictitious name is to be done at the county or the state level. There are also state variations regarding who is responsible for filing a fictitious business name based on how the company is being named.
There are two important reasons for registering a fictitious business name. By registering the business, the owner can be found in case of any problems related to the enterprise. Also, a business owner with a signed contract and registered business name can better enforce a contract.
The Objective of Having a Fictitious Name
Fictitious names are used for a variety of purposes, including:
- Naming a business.
- Legal purposes.
An example of identification would be a company named "Fax Express LLC." The LLC is the legal name designation and the one registered with the state. When you advertise, you may not include the abbreviation "LLC". You may also choose to do business under a trade name, such as "Fastest Faxing." In this case, a fictitious name must be registered since the business does not carry your name.
LLCs, partnerships, and corporations may also register fictitious names. Depending on the state of registration, you may or may not be exempt from the laws that require sole proprietorships to register fictitious names.
At the end of the day, if you are using a different trade name from the registered name of the business, it is the public's right to know who is in charge or running the business. Such a statement is often posted in a local newspaper or other approved media and becomes public record alerting the public that the trade name in use is connected to another legal name for the business.
For example, a business named "Smith Enterprises" DBA "Samantha's Crafts" means the business is using a trade name: "Samantha's Crafts." In this situation, the owner has filed a fictitious name statement connecting the trade name to Smith Enterprises.
Summary of Reasons for Using a Fictitious Name
- Company owners are easily found.
- Consumers can find the owner of a fictitious named business if they have complaints.
- Other businesses and start-ups can find out if the name they want to use is available.
- If your business operates under a non-fictitious name, you cannot sign contracts or enforce agreements on behalf of the enterprise.
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