By default, Texas law assumes that Rebecca does business under her name, i.e., “Rebecca Franklin.” Since she may instead wish to have a brand name that sounds more professional, Rebecca files a DBA to use the alias “Rebecca’s Bakery” as an alias for the business. Keep in mind that Rebecca is still a sole proprietor. The DBA name is simply an alias tied to that sole proprietorship.
Texas does not restrict assumed names to sole proprietors, however. Any person or legal entity conducting business in the state may use a DBA. But certain procedures must be followed. The experienced Texas start-ups and financial lawyers at Structure Law Group can advise you on the best legal practices for naming your business and ensuring your startup is branded correctly to compete in the market.
Do You Need to File With the Secretary of State or the County Clerk?
A legal business entity, such as a corporation or limited liability company, has a legal name stated in its articles of incorporation or organization, which are filed with the Texas Secretary of State. If such an entity wishes to use a different assumed name or alias that is different from the legal name, that requires filing a separate “Assumed Name Certificate.”
A Texas business may adopt a few restrictions under the types of assumed names. Notably, a business cannot use an assumed name identical or similar to its legal name. In other words, if your business is a corporation called “Acme, Inc.,” you could not file an Assumed Name Certificate for “Acme” or “A.C.M.E.” And your assumed name also need not contain any organizational identification, e.g. “Inc.” or “LLC.”
Corporations, limited liability companies, limited partnerships, professional associations, limited liability partnerships, and foreign entities doing business in Texas must all file an Assumed Name Certificate with the Texas Secretary of State. Unincorporated businesses such as sole proprietorships, general partnerships, estates, and real estate investment trusts must file instead with the county clerk in every Texas county where that business has an office or conducts business. The specific filing requirements and fees can vary from county to county, so it is essential to consult with an experienced Texas business attorney in this area.
Unless the Assumed Name Certificate specifies a shorter period, it will expire ten years from the filing date. The business must file a new certificate every 10 years if it wishes to continue using the DBA. A Texas business may also abandon a previously filed DBA by filing a separate form with the Secretary of State or the county clerk.
Contact SLG Today
There are potential civil and criminal penalties for using a DBA in Texas without making the necessary filings. So it is a good idea to consult with a qualified Texas business attorney who can help ensure your business is in compliance. Contact SLG today at (512) 881-7500 or contact us online to schedule a consultation.