How to Start a DBA in Kentucky
Kentucky has a lot to offer. From gorgeous bluegrass scenery and low tax rates to affordable housing and a strong state economy, Kentucky is a great place to start a business. Starting a DBA in Kentucky isn’t complicated, but it does involve understanding the rules and regulations of the state. Every state is unique and you want to get it right. We’ve created a guide to help you along the way with tips, links, and advice so you can gallop out of the starting gate with your business.
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What is a DBA?
DBA is an acronym that means “doing business as.” Some states call it by different names including an assumed name, a fictitious name, an alias name, or a trade name. No matter what they call it, the DBA meaning is the same. It’s when the name being used for business is different from your own name or the legal entity registered with the state.
There are many reasons for doing business using a DBA name. Sole proprietors use DBAs for legal protection, so they don’t have to use their personal names for the business. Others, including a limited liability company (LLC) and general partnerships, find using a DBA name has some tax advantages as well as legal protections.
How to search DBA names in Kentucky
A standard rule in most states is that a business name must be different from every other company name in the state. While that is true for registered businesses, it isn’t always true for DBAs. Kentucky law doesn’t give DBAs the same rights as a copyright name or trademark would, but it does require all names to be distinguishable from other businesses.
Practically, you should want your DBA name to be unique for marketing and legal purposes.
Check name availability
Those seeking to establish a DBA should check for name availability against all state-registered names when picking a DBA name to ensure their name is unique. The best place to start that search is with the Kentucky Secretary of State’s office.
Go to the business entity search page and type the name you want into the search box to find out if it’s available. It’s a free tool, so you can check as many names as you want.
You can also double-check local DBA names against business licenses at the county clerk’s office.
The county clerk will have a list of businesses that may not be registered with the state. You also can search for the name online to see if any other Kentucky businesses are using it that haven’t registered it with the state or local authorities.
Review the search results
The search will show you any exact matches or similar names to the name you selected when compared to all registered Kentucky businesses. The state will generate a list of up to 500 names. Even if there aren’t any exact matches, you don’t want your proposed name to be too similar to an existing business. The state could deny you the name if it isn’t unique enough.
Register a name you like
You can reserve a legal business name in Kentucky, but you can’t reserve a DBA name. All businesses, except for sole proprietorships, must have a legally registered name with the state to use a DBA name. All businesses must file for a DBA name registration to use it.
Have a name in mind? Check on name availability first here.
How to register a DBA in Kentucky
Kentucky has a different process and forms to file for a DBA registration. You will need to use their state form and fill out some specific information to be approved. However, this can be done electronically, by mail, or in person.
Those who want to file a trademark may also want to consult an attorney to ensure the process is done legally and properly. You will also want to check to see if you need to file your trademark with the state as well.
Find the state forms
The Kentucky Secretary of State requires you to fill out a Certificate of Assumed Name form. All businesses use the same form and you can find it here.
Fill out the form
You need to specify the name you want to use along with the legal name of your business. The form can be filled out either electronically or printed out to mail or hand it over in person. However, sole proprietors must turn these forms in at their county clerk’s office rather than with the Secretary of State.
You’ll need to provide the following information:
- Business name
- Business address
- Mailing address, if it’s different that the physical address
- The date you want the assumed name to take effect
Submit the forms and pay the fee.
You can electronically submit the forms, mail them, or drop the papers off. You’ll be required to pay a $46 filing fee.
Get answers to your questions
Business owners who have questions can find many answers here. You can also call the Secretary of State’s office at 502-564-3490 or in writing at:
Kentucky Secretary of State
700 Capital Ave.
Frankfort, KY 40601
Ready to register your DBA? Find your form here.
What comes next
Setting a launch date to use your DBA name in Kentucky doesn’t mean you are ready to conduct business. You must take care of some other important tasks to ensure your business is operating legally and effectively.
Open up a business checking account
Sole proprietors are accustomed to putting money from their business into their personal accounts and reporting it all on their taxes. However, there are different rules for those using DBAs. One of the purposes of having a DBA is to keep business money separate from personal money. A business checking account will do that. You will need a trade name certificate to show a bank in order to open a business checking account as most banks require it.
Get an EIN
A federal employer identification number or EIN is a number the Internal Revenue Service (IRS) gives a business to identify it to the government. It is required for those filing business taxes, hiring employees, and even for bank dealings. Some vendors require it contracts too.
Check state tax requirements
States tax businesses differently and set their own tax laws and Kentucky has its rules too. DBAs can be taxed differently than other types of businesses and you should be aware of all the rules. You can see how the rules apply to you by clicking here. All tax forms are filed with the Kentucky Department of Revenue.
Check with state insurance and hiring requirements
Kentucky requires worker’s compensation if you have one or more workers and it doesn’t make a distinction between family members and part-time workers versus full-time workers. Be sure to look at Kentucky’s laws so you stay within the standards. All business owners should look into other types of insurance like liability and property insurance, even though Kentucky doesn’t mandate you have these. They can offer solid legal protection. All vehicles must also be adequately insured according to Kentucky auto insurance laws.
Set up your business goals and policies
Something else many entrepreneurs don’t think about is writing down business goals and policies to lay groundwork for the future. Even sole proprietors benefit from a business plan because it establishes a business structure that sets how you will deal with both customers and vendors. It can help you get funding too.
Establish a marketing plan
Every business, including a new DBA, needs to start with a marketing plan to attract customers and develop its brand. A good marketing plan should include a variety of options from a local newspaper to television and the internet. It should also be a long-term campaign that brands your image with your DBA name.
Connect with resources for help
Kentucky has many wonderful resources to help both startups and established small business owners. Business owners should make the most of these services since many are free and offer a wide range of support from entrepreneur education to ways to get funding. Good resources include the Kentucky Small Business Development Center, the Kentucky Cabinet for Economic Development, and the Kentucky Small Business Administration. Additionally, cities like Louisville have their own resources. A complete list of Louisville resources can be found here.
If you plan to get an EIN, you can do so on the IRS website.
Who is a DBA best for?
Sole proprietorships and general partnerships often use DBA names so they can separate their personal name from the business name to protect personal assets. This way anyone who sues must sue the business and not the person owning the business. It also helps clarify records in case of a federal IRS audit.
Any type of legal business entity can do business under a DBA and many do it to build a branded image. Others use a DBA because they have multiple niche businesses they wish to keep as separate legal entities. The idea is to keep a DBA name separated from the legal name, which can be a company name or a personal name. The name of the business is one of the most important things you can do.
Why would entrepreneurs choose to set up a DBA in Kentucky?
Those seeking out success in Kentucky find many reasons to start a business there. It’s a thriving state with a lot of opportunities for entrepreneurs. Some other advantages of doing business in Kentucky are listed below.
- Kentucky is ranked first in the nation in its low cost to do business.
- It has flexible tax laws that help with the costs of locating, expanding, and reinvesting in businesses,
- Kentucky is geographically situated in a three to four-state distribution area.
- The state is second in the country in total air cargo shipments.
- There are many interstates, state highways, river barges, airports, and major rail networks for distribution.
- It has low electrical rates that are lower than the national average.
Cost to get a DBA set up
Kentucky has separate costs depending on whether you are a sole proprietor or another business entity.
- Sole proprietors pay a $46 fee for a DBA registration.
- LLCs and corporations pay $20.
Kentucky requires DBA registrations to be renewed every five years at the same cost.
Does Kentucky require a DBA registration?
Yes, any business seeking to use an assumed name must register it with either the state or the county clerk’s office.
Do I have to get a business license if I have a DBA in Kentucky?
The state doesn’t offer statewide business licenses, but you will be required to have a business license regardless of the type of business entity with the city or county where your business is based. The state also requires certain businesses to have specialty licenses.
Do I have to register my Kentucky DBA with the IRS?
No, you don’t register your DBA with the IRS. However, your legal business name will need an EIN if you report your taxes separately. Your DBA will need to be reported on your tax forms. Multiple DBAs will need to be filed separately and will need EINs as well.
Do my different DBAs in Kentucky need their own bank accounts if they are all a part of my registered company?
Every DBA will need its own business bank account so payments and expenditures can be made in the DBA name. Payments made to the legally registered company will go into that business bank account.
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