All You Need To Know About Assumed Name Certificates (DBAs) in Texas
Believe it or not, but not all businesses operate under the legal names that they’re registered by. Sometimes companies use fictitious or assumed names (also known as DBA – “Doing Business As”) for their businesses.
Why does a company need DBAs?
A company may be using an assumed name for a number of reasons. It may be because the DBA is more attractive from a marketing perspective, or they may be using it to create a separate business identity. Regardless of why a company chooses to use an assumed name, it must register an Assumed Name Certificate in order to operate legally under a DBA.
Why are DBAs Required?
DBAs were put in place to protect consumers from dishonest businesses using a different name in order to escape legal issues. After company files for a DBA, it’s typically printed in the newspaper so that the community knows who is actually behind the business.
Where do I file for a DBA?
The procedure for filing for a DBA is different for incorporated businesses and unincorporated businesses. Let me explain how …
Incorporated businesses such as corporations, limited liability partnerships, limited partnerships, LLCs (Limited Liability Companies) or foreign filing entities that are actively working in Texas are required to file a DBA with:
- The county clerk where the company has a registered office.
- The Texas Secretary of State.
Businesses that have not been incorporated must file their DBAs in each county in which they maintain or plan to maintain a professional office. If the company does not have any professional offices, then the company must file a DBA in the county in which it renders professional services.
A Word of Caution
While DBAs give you legal permission to use a different name, they do not transform your business into a separate legal entity. In other words, using a DBA won’t give you liability protection. If you’re running a partnership or sole proprietorship, you will NOT be protected from the liabilities and obligations of your business by using a DBA.
How long is a DBA Valid for?
Your DBA will be valid for a maximum of 10 years, but you’re allowed to renew it for another 10 years within the last sixth months of its expiration date.
Can I Cancel a DBA?
A DBA may be canceled anytime by filing a Certificate of Abandonment of Disposition of Interest.
Can I Make Changes to my DBA After Filing?
Unfortunately not, so make sure you get it right the first time! If you do need to make changes, you’ll have to file a new DBA. And that’s like throwing money away 😉
Can I File Multiple DBAs?
As long as you comply with the Texas Business and Commerce Code, you can file as many DBAs as your heart desires.
What Happens if I Violate Texas DBA laws?
Texas takes consumer protection laws quite seriously. Under the Texas Business and Commerce Code, both civil and criminal penalties may be imposed upon people violating Texas DBA laws. Don’t mess with Texas!
You should be careful about implementing your DBAs to the letter of the law. It’s highly recommended that you hire experts to sort out the legal details when filing a DBA. A single mistake could cost you hundreds or thousands of dollars.