Company owners and entrepreneurs often look at doing business under a different name. Reasons vary, but all are aimed at supporting operations.
Choosing a “doing business as” (DBA) name, or “trade name” as it’s called in the state of Colorado, can align better with the entrepreneurial vision. A separate business name that matches this vision is sometimes seen as necessary to boost branding in line with product or service offerings.
Our guide takes you through the step-by-step process to realize your new business name ambitions. This article will cover what a DBA name is, why it could be important for your small business, how to get one in Colorado, the implications of having a DBA name, and name renewal when required by Colorado regulation.
Read on to learn the ins and outs of everything you need to know about business operations under a DBA name in Colorado.
What is a Colorado “doing business as” (DBA) name?
Different terminology is used to describe DBA names, such as an “assumed name,” “fictitious name,” or a “trade name.” Colorado uses “trade name” as the official term to describe the use of a DBA name.
Businesses use DBA names for various reasons, including extensions of services or products. Picking a name for new business operations is also a valuable technique to help owners rebrand.
Colorado requires a formal filing of the DBA name for most business types because this informs the state and others that they are trading under a separate name.
Two main business categories that typically consider a DBA name are:
- Sole proprietorships and partnerships are required to use the legal names of the owners for their businesses. For example, if John Doe runs a landscaping business as a sole proprietor, he can legally only refer to his business as “John Doe” instead of, say, John’s Super Lawns. By the same token, he can’t open a bank account or have clients make checks out to any name but John Doe. A DBA name solves this problem by allowing owners to register a DBA name that suits their vision of the business.
- Limited liability companies (LLCs) and corporations can likewise elect to use DBA names. If legal names are lengthy, a DBA name is convenient to improve brand recognition. An example might be a company named “Turner’s Holdings,” which has several diverse operations, such as a car cleaning service, laundromat, and fast-food outlet. “Turner’s Holdings” does not reflect branding. DBA names can make branding and customer recognition easier for business owners.
DBA name registrations and legalities differ across states. Here are some Colorado state requirements to be aware of:
- Sole proprietorships, general partnerships, estates, trusts, corporations, LLCs, domestic limited partnerships, dissolved or converted entities, and any for-profit business must file DBA names when using a name that is not the legal name of the person or business. Nonprofit entities aren’t required to file for a DBA, but they still have the option to.
- Trade names do not need to be unique to the business owner, and it is possible to have two different people using the same DBA name, although it is recommended to try and find a distinguishable name for marketing reasons.
- Business owners don’t have to use a DBA name if they’re using their legal name. Also, note that the DBA name is not a form of legal protection and does not create a separate legal entity the way forming an LLC or corporation would. A DBA is only an alias and doesn’t affect how the law or the IRS treats you.
- A DBA doesn’t replace or override business trademarks in any way.
Businesses will frequently use DBA names because of the many benefits:
- One advantage of the DBA name for sole proprietorships and partnerships is that they can open bank accounts using the trade name. Deposits can be made into any bank account linked with the DBA name without them having to use their personal names.
- Some individuals may operate two operations or stores under the same legal business and want to keep track of distinct income streams by using dissimilar DBA names. Branding then becomes important to market these businesses in a distinct way. Choosing two separate trade names or DBA names typically occurs if the same business wants to market different products, for example.
How do I choose a Colorado DBA name?
Choosing DBA names can be fun, but there are several elements to think about other than the creative aspect.
Names are also easier to remember if they are simple and associated with the brand personality. Shorter names or distinctive names that describe your business are more memorable than long and complex names, for example.
Duplication of DBA names is allowed in Colorado because the legal name of the owner can be used to distinguish identity and ownership. Sole proprietorships and other business structures can also use an unlimited number of DBA names (though having many could be difficult to manage).
Check to see whether the name you want is already in use by using the Colorado Name Availability Search tool.
It’s important to remember that you need to follow Colorado regulations so that your DBA name is acceptable. Unless the business is the appropriate legal structure, you cannot include a business entity designator, such as “LLC,” in the DBA name.
Ensure that the DBA name selected is also available as a domain name before registration of both, as consistency is vital for branding purposes. You can then utilize ZenBusiness’s Domain Name Registration services, which can help secure a domain name that aligns with your trade name.
How do I register a Colorado DBA name?
Colorado has a user-friendly method to register a trade (DBA) name. You can only file the name online.
Follow these simple steps after deciding on a DBA name and checking its availability in line with a domain name:
- Go to the Colorado Secretary of State. Look for “Trade Names” at the top of the page. Select the trade name type to reflect your business, which you will find under “Trade Name Registrations.” You can choose from five trade name registrations.
- Select the right “Form Name” under “Trade Name Registrations,” depending on whether you are a sole proprietor, reporting entity, and so on.
- Follow the prompts to select the trade name that suits your business needs.
- Where a “Statement of Trade Name of a Dissolved or Delinquent Reporting Entity, a Non-Reporting Domestic Limited Partnership, or a Converted Entity” is required, you will need to do a search for your records online. Simply follow the prompts to determine state requirements.
- To complete the form for a “Statement of Trade Name of an Individual,” “Trade Name of a Non-Reporting Entity,” and “ Statement of Trade Name of an Estate, a Trust, a State or an Other Jurisdiction,” choose the status for the DBA name, followed by “File Online.”
- Form completion involves adding the true name of the owner, address and email details, the selected trade name, and a business description.
- If you want to reserve a trade name, this can be done for up to 90 days. Otherwise, you can select the option for the immediate filing of the name.
- Additional information can be attached to this form if necessary.
- State costs to file a DBA or trade name online currently costs $20. Note that state costs can be increased at any time.
How do I manage ongoing DBA name compliance in Colorado?
Renewal is required annually in certain cases, such as for an individual or non-reporting entity, a process that Colorado makes available online. Other entities typically don’t have to renew their trade name unless they become delinquent or dissolved, after which they have one year to reinstate or fix the delinquency and renew the trade name before it expires.
Something else to think about is that DBA names are not transferable in Colorado. You can withdraw, change, or correct your DBA name, but it may not be transferred according to state regulation. So, if you want to sell your business, the new owner will have to select a trade name of their own to continue operations. However, trademarks can be transferred.
Name changes should also be considered if you want to modify your business brand for any reason. Changing a trade name is as simple as withdrawing the current name and selecting a new name. In this case, you will need to follow the steps in the previous section to apply for a different trade name.
More Colorado DBA FAQs
- How much does it cost to register a Colorado DBA name?
Registering a trade or DBA name in Colorado will cost $20. Only online submissions for trade names are accepted. Trade name renewals cost $5. Trade name withdrawal, change of trade name information, and correction of trade name information cost $10.
- What is the processing time to register a Colorado DBA?
The Colorado Secretary of State’s website indicates that filing applications can be requested to be done immediately, or the effective date can be delayed for up to 90 days. If all the paperwork is in order, online filings are approved in real time.
- Do I need a DBA name for my Colorado business?
You are not legally required to operate under a trade name in Colorado. However, if you do decide to use a DBA name for professional business reasons, it is necessary to file the name.
Specifically, the state needs to know that you are operating under a different name for official reasons. Likewise, the public is entitled to know that you are operating under a different business name, other than your “true name.”
The “true name” is your legal name, which appears on identity and tax documents. Similarly, the “true name” of registered companies will be reflected in officially registered documents in Colorado.
Most business owners choose to file a DBA name in Colorado for the reasons discussed. Mostly, these reasons relate to marketing and branding benefits and banking. Sole proprietors and partnerships typically like to present a professional front by filing a DBA name. Likewise, LLCs and other registered businesses elect to file for a DBA name when business names become too long because of their official extensions and other business-related purposes.
- If I register a DBA name in Colorado, can another business use the same name?
Colorado’s new search system helps to exclude name duplication. If LLCs and other entities wish to use the same name, these can be differentiated by adding or removing words from the title. Example: “Torrance LLC” can become “Torrance Construction LLC” or “Torrance Construction Company Colorado.”
One way to overcome the problem of DBA name replication is to trademark your DBA name. Trademarks take precedence over DBA names, which is probably the best way to protect intangible business assets. A federal trademark from the United States Patent and Trademark Office (USPTO) can assist with this process, but a state trademark may be easier and less expensive to get.
- Can a business in Colorado have multiple DBA names?
Colorado business owners can use several DBA names to distinguish separate lines of business. There is no limit to the number of DBA names that you can choose in this state.
A dance studio owner may have named her business “Dance with Class” or “Class Dance Act,” but may want to branch out with a clothing line to support her dance classes. A new clothing brand name can align with her business intentions. A DBA name can be selected to reflect this strategy, for example, “Classic Dance Rags.”
- Is a DBA name the same thing as a fictitious business name in Colorado?
Common terms that are used in connection with DBA names include “fictitious” and “assumed” names. Colorado uses “trade name” to refer to DBA names.
- Do I need a DBA name in Colorado if I use my own name for a sole proprietorship?
Sole proprietors may conduct business by using their legal birth names but typically prefer to register a DBA name. While this is not a state requirement, it is recommended as a good business practice. For reasons outlined earlier, branding and banking issues can be conveniently separated by filing a DBA name. Further, if you conduct business in an individual capacity, you are not allowed to trade under another name unless you file a DBA name.
Remember that the assets of the sole proprietorship or general partnership are not legally separated through the use of a DBA name. Only registration of a formal company structure, such as an LLC or corporation, can achieve this goal.
- Will using a DBA name affect how my business is taxed in Colorado?
DBA names do not have any influence on tax obligations in Colorado or any other state. Neither tax requirements nor the original business structure is altered in any manner by the DBA name. A trade name is simply used to identify a business and keep it separate from the name of the sole proprietor, LLC, or another business structure.
If you need help forming, running, or growing your business, ZenBusiness has a variety of services to help. We can tame the red tape so that you can focus on the parts of your business you most enjoy.