There’s more to naming your limited liability company (LLC) or corporation than picking the perfect name for your business. You must also ensure that the name complies with state LLC or corporation law before you file to form your LLCor corporation.
This means that the name must not conflict with a name already on the state business entity filing office’s records. Plus, the name will likely need to meet requirements concerning required or prohibited words or phrases.
If you’ve already formed your limited liability company or corporation but want to expand your business in another state, you’ll have to satisfy the other state’s naming rules when you qualifyto do business there. And there are other names your corporation or LLC may use, such as DBA (assumed names), fictitious names, and domain names, that may be part of your business naming process.
Here are twelve points to consider when selecting or changing your business name.
1. Your business needs a legal name for the formation documents
An LLC’s or corporation’s legal name is the official name used when you file with the state to form your LLC or corporation. It appears on your formation document (e.g., Articles of Incorporationor Certificate of Organization). This name must meet the state’s business entity naming requirements for LLCs and corporations.
2. You can have one legal name but more than one assumed name
Your business can have only one “legal” name at a time. But it can have any number of assumed or DBA(“doing business as”) names. So if you have some other business name ideas, you can use them as DBAs. For example, if your LLC’s legal name is “Smith and Jones, LLC”, you could file a DBA to do business as “Best Painters” and another DBA to do business as “World Wide Painters”. You can use these DBA names on your website, signs, ads, promotions, and so on.
3. Your legal business name must be distinguishable
The legal name of your LLC or corporationmust be distinguishable from the names of other entities on record with the state filing office. Otherwise, the state may refuse to file the documents to form your LLC or corporation. The same rule of it being distinguishable applies in some states when filing for an assumed or DBA name.
However, there are a number of states where assumed names do not have to be distinguishable, meaning more than one company can file the same assumed name.
CT Tip: Each state varies in how it decides whether a name is different enough to be distinguishable and therefore acceptable for filing.
4. Your legal business name should include the correct required words
States generally require that the legal name of your LLC or corporation include certain words indicating your business structure.
- Corporations: A corporation’s name typically must include words like Corporation, Incorporated, Company, or Limited; or abbreviations, like Corp., Inc., Co., or Ltd.
- Limited Liability Companies (LLCs): An LLC’s legal name usually must include words like Limited Liability Company, Limited Company; or abbreviations like L.L.C., LLC, L.C., LC, or Ltd. Liability Co.
5. Your legal name should not contain any prohibited or restricted words
Many states also prohibit certain words in a business name. Some are words that the state considers inappropriate. Others are intended to protect the public from being misled. For example, a state might not allow “Insurance” in the name of a business that’s not an insurance company or may require the approval of the Insurance Department before allowing the use of that word. They also prohibit words that indicate it is a form of entity that it is not. So a limited liability company couldn’t have “corporation” in its name.
6.Comply with laws in other states where you are qualified to do business
In order for your LLC or corporation to qualify to do business in states outside its state of formation (known as foreign qualification), your company name must also meet the statutory requirements of the foreign state(s).
Under most LLC and corporation laws, the name of a foreign LLC or corporation name must meet the same statutory requirements as the state’s domestic LLCs or corporations. And if you want to do business under an assumed or DBA name, most foreign states will also require you to register the assumed or DBA name.
7. Adopt a fictitious name, if your corporation’s or LLC’s legal name is not available
If you find that the name your business is formed under cannot be used in a state in which it will qualify, you will generally be required to adopt and do business under an acceptable fictitious name (also known as an alternate name). The fictitious name must be set forth in the application for authority that you file to qualify in the state.
8. Choose a memorable name
The company name is a valuable asset for any business owner. It can help potential customers remember you, find you, and understand what you do. Don't make your business name so obscure that customers can’t determine what it means.
This often occurs when under pressure to find a unique web domain name. Business owners purposefully misspell or awkwardly construct a business name.
Try to come up with a name that is relevant to your industry or business. For example, if you have an Internet business, you may want your web domain name to be included in your legal name.
That doesn’t mean that the name needs to be descriptive — save that for your tagline or slogan. But find a way to stand out with a catchy, distinct, and evocative name, one that speaks to the core of your business.
