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 LLC or corporation.
Súlad s predpismi08 septembra, 2022|Aktualizovanénovembra 27, 2023
12 tips for naming your LLC or 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 qualify to 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 Incorporation or 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 corporation must 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.
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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.
9. Conduct a trademark search
Just because a legal name is considered available by the state filing office, it doesn’t mean that some other company doesn’t own trademark rights to the name.
The state filing offices don’t check state, federal, or common law trademark records when determining whether a name is distinguishable. They check their own business entity filing records.
The penalties for trademark infringement are severe, so it’s important to check that your choice of business name isn’t already protected. You should also make sure other names, like assumed, fictitious, or domain names you might use won’t infringe on someone’s trademark rights. Conduct a trademark search to uncover if any names or marks already in use are identical or similar to the names that you choose. The U.S. Patent and Trademark Office has tips on How to conduct a trademark search.
10. Perform a name check with the state
You’ll also need to conduct a name check with the state filing office to determine if your preferred legal name is available within state records.
Doing a name check will prevent a state from rejecting your documents because the name isn’t available when you try to incorporate or form an LLC. But keep in mind, a name check simply tells you that the name is available at the moment you perform the check. It does not “hold” the name for you or guarantee that you’ll have it. If there will be a delay before you are ready to submit your incorporation or formation documents, consider taking advantage of a name reservation. This leads to our next point.
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11. Buy time by reserving your name
If your preferred legal name is available in a state, it remains available for anyone else, too.
However, most states let you file a name reservation to protect your right to that name for a period of time. A name reservation usually lasts 60 to 120 days, but the duration varies by state. Many states allow you to renew the reservation.
CT Tip: If you are not yet ready to incorporate or form your LLC, a name reservation lets you reserve your preferred name for future use. Reserving a name also comes in handy if you’ve already incorporated or formed an LLC and then you want to change your legal name.
While your name reservation is in effect, other companies are prevented from forming under, qualifying under, reserving, registering, or changing their name to your reserved name with that state office. If you incorporate or form an LLC in one state and plan to do business in other states, you could file for a name reservation in the other states as well.
Reserving your desired name typically requires properly filing a name reservation and paying any state fees. Once your name reservation time frame expires, the name you had reserved becomes available again in the state’s records.
If you plan to expand into other states in the future, consider a name registration in those states (instead of name reservation). A name registration generally allows you to preserve your legal name in a state even if you haven’t yet qualified to do business there.
However, unlike name reservations, not all states provide this option. And many that do, only provide it for corporations, not LLCs. A name registration, where available, generally lasts for a year and can be renewed indefinitely.
12. If you change your legal name, remember to meet the statutory requirements
You can change your corporation’s or LLC’s legal name as many times as you want, but the new name will have to meet the same statutory requirements as the original legal name. And to make the name change effective, a filing will have to be made with the state — typically either the articles of amendment or a certificate of name change. If the corporation or LLC is qualified in any foreign states, an amendment or change of name filing will have to be made there too, to notify those states of the change.
Summary
As you can see, selecting a name for an LLC or corporation goes beyond thinking of the perfect one. There are statutory restrictions to consider — and not only in your formation state but in each state where your LLC or corporation will foreign qualify too. In any event, it’s best to check your name’s availability with a state. And if you need some time, a name reservation helps ensure your name will be there for you when you need it.
Learn more about how CT Corporation can help with naming your business. Contact CT Corporation today!