How to Start a DBA in North Carolina
North Carolina is a state with multiple well-known urban centers: Asheville, Greensboro, Charlotte, and Raleigh all draw the attention of tourists and new residents alike. But beyond these city limits, the state is also full of rich and diverse rural communities that mean nearly anyone can find a place to live and work. This includes small business owners, who are drawn to North Carolina’s manageable tax rates and business-friendly regulatory environment. If you are among those looking to start a new business in The Old North State, you’ll need to consider a business name and consider registering it as a DBA.
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What is a DBA?
The acronym “DBA” stands for “doing business as” and is used to refer to a business operating under a different name from its legally registered name. Different states use a variety of terms to refer to this concept, like “fictitious name”, “assumed name”, or “trade name”, but they all amount to the same concept.
A DBA is the name that will be used for operations of your business. It’s what you may see on signage and business cards, what customers will know you by, and what you will use on most documents. But with a DBA in place, your business’s true legal name remains something else, usually the legal name of the owner.
How to search DBA names in North Carolina
Though the North Carolina DBA registration process is managed by local governments, rules surrounding the names themselves are still a state-level regulations. This means that you will need to adhere to all North Carolina laws in this area.
Learn North Carolina’s naming rules
When it comes to business names, North Carolina does not allow names that are inaccurate in any way. This includes business entity suffixes; for example, your LLC cannot include the term “Incorporation,” and your corporation cannot include the term “LLC” in the name of the business. Additionally, many words will require specific approval to use to ensure that people are properly licensed to conduct that business. You can see this full list here.
Check the Assumed Name database
North Carolina is one of the few states that does not require every assumed name to be unique. This means that you are not required to see if your chosen name is available, but it is still recommended. Having the same name as another business, especially one in close proximity to yours, can lead to confusion on everyone’s part.
Before committing to a name, search the Assumed Name Database in North Carolina to see what names have and haven’t been used.
Look outside North Carolina
It is also possible that the name of your business has been used in other states. There is no rule against this, and you don’t need to check every state’s name listing. But you want to understand what a customer might see if they search for you, so it’s important to emulate that process by conducting a broad internet search.
See if other businesses of the same name come up and if they might confuse a customer. Pay special attention to things like website domains and social media handles to be sure yours is available.
Have a name in mind? Check on name availability first here.
How to register a DBA in North Carolina
In North Carolina, the Secretary of State sets forth the regulations for DBA filing, but the actual process takes place in individual counties. This means that most rules are the same from county to county, but your specific County Register of Deeds may have additional requirements to be mindful of during the process.
You should always check with your specific county clerk’s office to understand their requirements. A full listing of all county contact information is available through the North Carolina Association of Registers of Deeds.
As an example, below are the steps to obtain an assumed business name in Mecklenburg County, where Charlotte is located. This is similar to other counties in the state.
Download the Assumed Business Name Certificate
You can find the Assumed Business Name Certificate here, to be printed out or filled in electronically.
Complete the Assumed Business Name Certificate
You can either fill out the form online by editing the pdf, or print it out to fill in by hand. Be prepared to give information such as:
- The business name you will be using and the real name of your business
- The nature of the business
- A street address and mailing address for the business
- A full listing of counties where the business operates
- Signature of the person filing
File paperwork with your County Register of Deeds
Mecklenburg County does not allow electronic filing of DBA certificates. Instead, the form can either be mailed to the Register of Deeds or delivered by hand.
Ready to register your DBA? Fill out these forms.
What comes next
Establishing and filing an assumed name is one task that small business owners may need to complete during the process of starting their business. But there are many other requirements to open and maintain a business that are important to understand, otherwise your business could fall out of good standing with the state. These are just some examples of common considerations for businesses in North Carolina.
Consider getting an EIN
When you file your personal income taxes, the IRS uses a Social Security Number to be sure they have the right person and everything is properly tracked. Similarly, businesses can be assigned a unique, nine-digit number that is used to identify them, called an Employer Identification Number.
Many businesses will be required to have an EIN in place. If you have employees, pay excise taxes, or have a specialized 401(k) plan, this is a requirement for your business. But even if it is not, an EIN can be helpful.
Banks and lenders may require an EIN before you can open an account. An EIN also allows you to provide this number instead of your personal Social Security Number and protect your identity. The credibility and options that come with an EIN, coupled with it being free to obtain, make it a smart choice for all businesses.
If you plan to get an EIN, you can do so on the IRS website.
Obtain licenses and permits
There is no single, generic business license required across North Carolina. However, businesses operating there will need a seller’s permit, or a Certificate of Registration. This certificate is issued by the state’s Department of Revenue and serves as proof that the business has paid taxes and fees with regards to all applicable regulations.
Your business may need to obtain other licenses, as well. The North Carolina Business & Occupational License Database can help you see what industries and professions need state licenses to operate.
Additionally, each local government can set their own licensing and permitting requirements. City of Charlotte, for example, requires a New Business Registration Form for businesses to collect and remit local taxes. It is always best to check with county and city government offices to be sure you have all the necessary licensure.
Open a business bank account
As soon as you start spending or making money, it’d important to start a dedicated bank account for your business. At a minimum, this can make your accounting and tax filing process much simpler. But for some businesses, it is also an important legal protection.
For example, in an LLC, the personal asset protection that is granted assumes that business owners are not mingling business and personal finances. If this is not the case, it can lead to a phenomenon called piercing the corporate veil, and the protection can be revoked.
In addition to a checking account, you may also be able to open credit cards in your business’s name and establish a credit score.
Keep your DBA current
There is no expiration on DBAs in North Carolina, so you will not need to renew your certificate at any time. However, if you make any changes to the assumed name, it will need to be filed as an amendment with the Register of Deeds. You will also need to complete a withdrawal form to cancel the assumed name. Both of these have a filing fee and documentation to complete.
Who is a DBA best for?
Not all businesses will have a need to use a DBA. Along with state-specific requirements, the legal structure of your business and the owners’ personal preference will be major factors in whether this is necessary.
When it comes to business structures, the legal process for registering your business may indicate whether a DBA is useful. The most common uses of a DBA are:
- Sole proprietorships and partnerships will be registered by default under the name of their owner. Since there is no formal paperwork to name the business, there is no other name that it could be listed as. In this case, a DBA would allow the business to have a publicly-facing name other than your own.
- Franchises often use a DBA to establish their business as a local one. For example, you may own a local McDonald’s, and will need to register it as something like an LLC or corporation. The business may then be called ABC Burgers, but a DBA would allow you to operate as “McDonald’s” to tie you to the parent company.
Other business structures, like an limited liability company or corporation, do not usually need to use a DBA. This is because part of registering these businesses includes choosing a name, which can be anything. Some localities may require this, but it is rare. These businesses can always choose to register a DBA if they choose.
Why would entrepreneurs choose to set up a DBA in North Carolina?
Typically, a business has a very practical reason for establishing a DBA. The most common benefit is the ability to operate under a chosen name, rather than the owner’s personal name under which the business is established. For sole proprietors and general partnerships, this affords control over marketing and branding without the hassle of formation paperwork or having to use their own name.
But an LLC or corporation can also benefit from an assumed name. In order to maintain a single legal entity, the business can be expanded into other branches and product lines with relevant names. The ability to easily use another name in marketing can be another reason to choose a DBA.
Cost to get a DBA set up
When it comes to the process of filing a DBA, the cost is low. The Secretary of State sets the DBA cost throughout the state, though the fee is paid to each county. This fee is set at $26.
However, keep in mind that a DBA cannot be created until another business is established. This can include a variety of fees depending on the type of business entity being formed. For a sole proprietorship or general partnership, there is no formation fee, but for LLCs and corporations, there is a $125 charge for the formation.
Other costs may come in the form of optional processes, like reserving a name ($30) or expediting various processes.
Additionally, there may be costs associated with licensing that allows you to operate a business fully. The state Certificate of Registration does not cost anything, but specialized permits or local licenses could have costs.
You will want to do a full evaluation of your projected startup costs to understand what capital you need.
How long does it take to register a DBA in North Carolina?
Because each county’s Registrar of Deeds manages the filing, the filing time can vary. Check your local county office for exact times, and be sure to include a few extra days if you plan to mail the forms in.
Can I have multiple DBAs in North Carolina?
Yes. In fact, when registering your DBA, you are allowed to provide up to five names the business will go by using a single form.
What is a DBA called in North Carolina?
A DBA, or doing business as, is one term for when a business uses a name other than its legal name for operations. This has a variety of other titles, like fictitious business name or trade name. In North Carolina, this is most commonly called an assumed name.
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