How to File for an Assumed Name in Vermont
Having the right business name is essential to branding and growing, but sometimes a business’s official name isn’t perfect for reaching customers. If you’re starting a business and you’d like to use a business name that’s different from your business’s official one, that’s what a DBA is for. Here’s how to file a DBA in Vermont.
What is a DBA?
A DBA (doing business as) allows your business to operate under a name other than the one used for official state purposes.
Your official business name might be your personal name if running a sole proprietorship, or something with “LLC” if you have a limited liability corporation. A DBA can be entirely different, allowing you to reach customers under a name that’s more suitable for branding and marketing.
For example, consider John Doe who’s a self-employed plumber working in Burlington. He operates as a sole proprietor, and thus would likely have to use his name “John Doe” for advertising, depositing checks, and everything else. A DBA would let him operate as “Burlington Plumbing” instead, which is much more effective for reaching customers.
Filing a DBA doesn’t change your business structure or status, but is simply a different name to use. It can be used by any type of business, including sole proprietors, LLCs, corporations, partnerships, nonprofits and others.
DBA, Trade Name and Assumed Name
Vermont refers to a DBA as an “assumed name,” and used “trade name” previously. Assumed name, trade name, DBA and doing business as all refer to the same thing — a name that your business can use. Sometimes a DBA is also referred to as a “fictitious name,” but Vermont doesn’t use this term.
Benefits of an Assumed Name
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Exclusive use: A DBA provides your business with exclusive use of the registered business name. No other business operating in Vermont can use the name. -
Any business structure: You can file for an assumed business name regardless of your business structure. This is most advantageous for sole proprietors, as it lets them secure a business name without the complexity or expense of an LLC. -
No EIN requirement: An employer identification number (EIN) functions like a Social Security number for businesses. Sole proprietors, who aren’t required to use an EIN, can file for an assumed business name without getting an EIN. -
No designator requirement: Businesses that function as anything other than sole proprietors usually need to have a designator, like “LLC” or “Inc” in their official name. An assumed name lets them market without the official designator.
Disadvantages of an Assumed Name
There aren’t many disadvantages of a DBA per se, but business owners should understand two significant limitations:
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No liability protection: A DBA doesn’t create a separate legal entity, so it doesn’t provide sole proprietors any protection for personal assets if the business is sued. An LLC or other business structure provides a “corporate veil” that protects personal assets. -
No tax benefits: A DBA doesn’t provide tax benefits like an LLC or other business structure might.
Consequences for operating an Assumed Name without registration
Vermont Law (11 V.S.A. § 1626) requires businesses to register any name that they’re going to use within the state. Using a business name other than any officially registered one can result in fines of $50 per day (maximum $10,000). Official names include the name that your business is registered under, and any registered assumed names for the business.
There can be other legal consequences for operating without a DBA registration, too. Your business won’t have legal protection if there’s a dispute over using the name. You also could face a defamation or infringement lawsuit, if another business has officially registered the name.
If your business is an LLC, partnership or corporation, using a non-registered name might help an opposing attorney pierce the corporate veil. This could leave your personal assets vulnerable even if your business’s structure would normally give protection.
Finally, using a non-registered name could force your business to establish its brand from scratch. Should you be forced to stop using the name, you’d have to rebuild the business under a different one.
There is one exception to the assumed name requirement. Under 11 V.S.A. § 1621, single business owners don’t have to register their business name if using their full name. For example, “John Smith Carpentry” wouldn’t need to be registered.
Tax considerations
Registering an assumed name does not affect how your business is taxed. Your business will continue to be taxed based on its underlying legal structure (sole proprietorship, partnership, LLC, corporation, etc.).
Filing for an Assumed Name in Vermont
The process of registering a DBA in Vermont is straightforward. It requires filing a simple assumed name form, and paying a $50 assumed business name fee.
Name requirements
Any business name, including assumed business names, must meet certain requirements set by state law (11 V.S.A. §§ 1621(c)). Vermont’s business name rules are as follows:
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Distinguishable: The business name must be different from any other actively registered business name. In general, putting words in a different order, adding or omitting a keyword or number, using different keywords, and using homophones all qualify as different. Changing punctuation, adding other characters, and other minor changes usually don’t. -
Discriminatory language: The business name can’t defame, be offensive to, or put down a person or group. Essentially, the name can’t discriminate against any racial, religious, ethnic, sexual orientation, gender, age or disability. -
Indecent language: The name can’t include any words or phrases that the average person would find indecent. Essentially, don’t use a name that would make your grandmother blush. -
Obscene language: The name can’t include any words or phrases that the average person would find offensive or threatening. The line between indecent and offensive isn’t always clear but both are prohibited. -
Restrictions: The name generally can’t infer a governmental affiliation, or use just one person’s name if the business is owned by multiple people. Individual business owners often can use just their name.
Begin with a Vermont Assumed Name Search
A Vermont assumed name search will show you whether a business name is available, meaning that no other business in the state has a legal claim to it. The Vermont Secretary of State’s Corporations Division has a business name search:
- Use the Corporation Division’s official business name search.
- Select “exact match” in the search options. This option will include variations that aren’t substantially similar. For example, typing “and” will include searching “and” as well as “&”.
- Click on “status” to sort results by their current status. Names with the following statuses are already claimed by another business: “active,” “expiration pending,” “terminated,” “registered,” “reserved,” or “hold.” Business names with statuses of “inactive expired,” “withdrawn,” “dissolved,” “canceled,” “merged” or “converted” are available, as another business no longer has claim to them.
You can also select “contains” for a more thorough search, although your name should be distinguishable from anything that’s not an exact match. You might consider a trademark search in case a name is trademarked but not registered, but this is quite unlikely.
Steps to register your Assumed Name in Vermont
You can register a Vermont assume name online, which is the faster and preferred option. Mail-in assumed name registration is also available, though.
Step 1: Complete the registration form
The registration form for an assumed name is fairly simple. You can complete it online through the Corporations Division’s BizFilings (account required). You’ll be walked through each step after choosing to register an assumed name.
To register using a mail-in form, you’ll have to request the form from the Vermont Secretary of State. The form will be sent to you, and is self-explanatory once you receive it.
Note: A Vermont Trade Name (DBA) Registration Form is available via an online search. This uses the state’s old name for a DBA, however, and isn’t up to date. You’ll need to request a form from the Vermont Secretary of State instead.
Step 2: Submit the form and pay the fee
Complete the online registration, or send the mail-in form to:
Business Services Division
128 State Street
Montpelier, VT 05633.
You can call 802-828-2386 or 888-647-4582 if you have any questions.
A $50 assumed name registration fee is required when submitting your form. The fee can be paid by credit card if filing online, or check if filing via mail.
Step 3: Receive confirmation
You’ll receive confirmation once your assumed name registration has been processed. Processing time for online filings is normally 1 business day. Processing time for mail-in filings can be 7-10 business days.
You can request a certificate of assumed name from the Vermont Secretary of State, should you ever need one.
Step 4: Renew your Assumed Name
Assumed name registrations are good for 5 years in Vermont, after which you’ll have to renew. Make a note somewhere so that you don’t forget to renew. Renewals are best submitted online, through BizFilings.
Filing online vs. by mail
Filing an assumed business name online, through Corporations Division’s BizFilings, is the preferred method. You can immediately file online, and processing takes just 1 business day.
Filing by mail requires first requesting the form the Vermont Secretary of State. You’ll mail the form to Business Services Division, 128 State Street, Montpelier, VT 05633 after you receive and complete it. The state typically takes 7-10 business days to process, once the form is received.
The filing fee of $50 is the same, regardless of how you submit your business’s information.
Conclusion
Registering an assumed name will let your Vermont business market and operate under a name other than its official one. That’s often a better option than using your personal name or needing to include a designator like “LLC,” and registering an assumed name is both simple and inexpensive. Filing a DBA for your Vermont business could be the next step to growing your business and its brand.
FAQs
Is having an Assumed Name (DBA) in Vermont a must?
No, operating with an Assumed Name in Vermont is optional. It’s only necessary if you want to operate under a name that’s different from your business’s official name.
How much does an Assumed Name cost in Vermont?
The filing fee for a Vermont Assumed Name is $50. This fee is the same whether you file online or by mail.
Do you need to renew an Assumed Name registration in Vermont?
Yes, Vermont assumed name registrations are good for 5 years. You’ll need to renew a DBA after this time.
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