Naming your business is simultaneously one of the most exciting and yet critical parts of starting your company. Your name sets the tone and puts your personal mark on the business. But you also have to comply with laws on business names, especially the ones dedicated to LLCs.
This guide serves as your one-stop resource for naming your LLC, including rules and marketing considerations. We’ll also cover maintaining and protecting your name once it’s yours.
Important Factors to Consider for Your LLC Name
1) Legal compliance
The most common business name requirement is that your name is distinguishable from names already in use in the state. What constitutes “distinguishable” varies from one state to another, but it must be unique enough. Plus, you’ll want to ensure that your name won’t be confusing to your customers. You’d hate to lose business because a customer mixed up your business with a competitor! To check your name, you should run a name availability check on your state’s website.
Similarly, your name cannot infringe on federally protected trademarks. Many trademarks include a full business name or an abbreviation of it, so you’ll need to stay away from these protected names or phrases. Trademark infringement lawsuits are messy, but you can easily avoid them just by doing your research. You can search the trademark database here.
Each state has its own laws for LLC names. (You can read about them in your state’s Limited Liability Company Act). Usually, your name must include an identifier of your entity type, such as LLC, L.L.C., or a similar tag. On top of this, some states prohibit the use of certain words, such as “bank,” “insurance,” “trust,” or other words. Finally, your name cannot imply that your business is conducting activities that don’t align with your stated purpose.
2) Marketing strategy
Now that we’ve covered the legal essentials of naming, let’s talk about marketing strategies. Your name is your first (and free!) form of advertising. For one, the name you choose should be easy to spell, say, and recall. This lets you take advantage of word-of-mouth advertising. If your name is hard to say or remember, then you can bet your customers won’t talk about it.
Your name should also be unique without being bizzarre. You want it to stick out in your customer’s minds, but for the right reasons. If your name leaves customers thinking, “What in the world?”, you might not be creating the right impression.
That’s also why your name should give an idea of what your business does. If you sell the best sandwiches in town, your name should reflect that somehow.
At the end of the day, your business name is just that: yours. You should like your name and take pride in it. It takes time to create the perfect name, but in the end, you’ll be glad you did.
Finally, if you intend to establish an online presence, you’ll want to consider domain names and social media handles. Even if your business name is available in your state, you may not be able to convert your name into a URL domain that matches exactly. If you can create an abbreviation of your name for your domain that blends well with your full business name, it will help your customers find you online.
Claiming Your Newly-created LLC Name
Even if your name is available when you search it, there is no guarantee that you can actually claim the name. You formally claim your name when you incorporate your business. LLCs incorporate by filing the Articles of Organization (or comparable document) with the Secretary of State. Once you’ve formed, no one else will be able to use your name.
In theory, there is a chance that another business could file the name you’ve chosen before you do. If this happens, you’re out of luck. You’ll need to start over and create a new name. Thankfully, you can avoid this situation by reserving a business name.
Most states (excluding Florida) allow you to reserve a business name prior to incorporating. You’ll need to file an application to reserve a name with your Secretary of State, where you can find the necessary forms. There is a filing fee for this reservation; the usual costs range from $10-50.
In most states, a name reservation lasts for 60-120 days after filing. Other states’ reservations last only 30 days, and others give you a year. However long your reservation lasts, it will buy you time to get your business affairs in order. While your reservation is active, no one will be able to form under the name you’ve chosen.
Changing your LLC name
Disclaimer: hopefully you’ll never need to change your name. It is a lot of work, and finding the perfect moniker can prove challenging. However, you may need to change your name someday down the road.
Over time, businesses grow and change and decide to rebrand. In these circumstances, your name might not be the right fit anymore. Then a name change is in order.
There are a couple ways to accomplish this: you can amend your articles of organization or add a DBA registration. Amending your articles would be a complete legal change of your business, as it would change the legal name of the business. As a result, you’d also need to change other legal documents, including tax registrations, bank accounts, and business licenses, and business licenses that are issued to the business. The advantage of this method is that your new name is protected in the same way your original was. This may make up for the additional hassle of amending other filings.
Adding a DBA registration to your LLC is simpler; you’ll simply need to register your DBA with your state or county clerk office (whichever is required in your region). The DBA registration does not change the legal name of your business; it simply allows you to operate under an additional name. Since your legal name does not change, you won’t need to amend tax registrations or similar documents.
Of course, there is a drawback to choosing a DBA when switching to a new name. Most states do not protect DBA names, so multiple businesses can operate under the same name. You won’t have any guarantee of exclusivity. Finally, not all states register DBAs. You’ll need to check with your Secretary of State’s business division before proceeding.
Protecting your LLC name
You’ve invested time, thought, and even money into your business name. It’s only natural that you’d want to protect your name. In this section, we’ll briefly discuss your options for protecting your name.
Even though your LLC’s legal name is protected by the state, that protection only goes so far. If your legal right to the name is contested, the state’s protection alone does not guarantee your ownership. This occurs because each state monitors its own records, not those of other states. So if there is tension over a name that crosses state lines, it can be difficult to determine which business truly owns the name.
Your best resource in protecting your LLC’s name is a business lawyer. The legal counsel offered by a lawyer can help you learn what precautions you can take to keep your name exclusive.
You can also consider registering your name as a federally protected trademark, especially if you have a logo that accompanies your name. Trademark protection is nation-wide, so it is the most comprehensive option for protecting your business’s key identifier. Applying for the protection can be a tricky process, so again, you may want to get legal advice to avoid time-consuming errors.
Conclusion
Congratulations! By now, you’ve finished the hardest part of forming your LLC. We hope this guide helped make that step a little bit easier. Best of luck with your new LLC!