Your company name is one of your most precious assets as a business owner. It sets you apart from your rivals and contributes to the development of your brand. However, if the right safeguards aren’t in place, someone else could use or infringe upon your company name. Getting a Trade Name Certificate is one of the ways to protect your company name in Connecticut.
A trade name certificate, commonly referred to as a doing business as (DBA) certificate, is an official document that permits a company to conduct business under a name other than its legal name. Businesses who want to adopt a different name for marketing or branding purposes will find this to be especially helpful. For instance, if John Smith wants to start a bakery in Connecticut named “Sweet Treats,” he will need to get a Trade Name Certificate before he can use that name for his company.
You must submit an application to the Connecticut Secretary of State in order to get a trade name certificate there. The following information must be included in the application, which can be submitted online or by mail:
– The legal name and address of the business
– A brief summary of the operations of the business
A Trade Name Certificate must be filed in Connecticut and costs $10. The certificate is good for five years. Once you have your certificate, you are able to use your trade name for all business-related purposes, such as contracts, bank accounts, and advertising.
Despite the fact that a Trade Name Certificate may be a helpful tool for safeguarding your company name, it’s critical to be aware of any potential drawbacks. The fact that a DBA offers no legal protection for your company name is one of its key disadvantages. This implies that unless you have a trademark or service mark on your business name, you will have no legal redress if another company starts using your trade name or a name that is similar to it.
A DBA has the additional drawback of offering your company no liability protection. All of your personal assets could be at stake if you run your firm as a single proprietorship and get sued. You might wish to think about creating a different legal structure, such a corporation or limited liability business (LLC), to shield oneself from personal liability.
No, a DBA and a single proprietorship are not the same thing. A sole proprietorship is a kind of business entity in which the owner also operates the company. In other words, there is no formal distinction between the assets of the business and those of the owner. Contrarily, a DBA is only a trade name that a company use to conduct business under a name different than its legal name. A DBA can be used by a sole proprietorship, but it does not establish the owner as the owner of a different legal company.
In conclusion, safeguarding your company name is essential for its success. One approach to safeguard your company name and conduct business under a different name in Connecticut is to obtain a Trade Name Certificate. To protect oneself from personal liability, it’s crucial to be aware of the potential disadvantages of a DBA and to think about creating a different legal entity.
A separate bank account is typically advised for a company doing business under a DBA (Doing Business As). This can aid in keeping track of earnings and costs unique to that company, as well as offer some amount of protection for personal assets in the event that the company is sued. However, the practices of the particular bank and the laws/regulations of the state in which the business operates may determine whether or not a separate bank account is necessary for a DBA. For advice on this subject, it is preferable to speak with a financial advisor or attorney.