How to Start a DBA in Vermont
Vermont has a lot to offer small business owners. If you’re ready to turn your dream business into a reality in the Green Mountain State, registering a DBA might be your first step. A DBA, or “doing business as” gives you the opportunity to set up a business name that’s different than your own name. In Vermont, it’s called an assumed business name, as opposed to a DBA. To set one up, you need to pick an available name, register it with the state, and follow good business practices to complete its setup. To help new startup owners, we’ve created a handy guide that explains everything you need to know about setting up an assumed name in Vermont.
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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 a name that’s used for business operations. 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 personal name of the owner.
How to find an available business name in Vermont
To file for an assumed name (or fictitious business name) in VT, you need to come up with a name first. Vermont won’t allow two businesses to have the same name, so even if you have the ideal name in mind, you have to check its availability first. Here’s how to do that:
Go to the state website
To see if the business name you’d like to use is available in Vermont, go to the Vermont Secretary of State’s website and use the business search tool.
You can come up with a list of names and run each one through the search tool.
Have a name in mind? Check on name availability first here.
Review the results
If there are no matches, that means you are free to use the name.
If there’s a business with the same name or even a similar name, you can’t use it.
The state won’t allow two businesses to exist with the same name. If you file for an assumed name with a name that’s already in use, the state will not approve it.
Each name must be distinguishable. The state explains what this means on its website.
Register the name
Now that you have a name that is free to use, you can now file for an Assumed Business Name and use that name for your small business. Instructions are next.
How to register a DBA in Vermont
Now that you know most of what you need to set up an assumed name in Vermont, here is the easiest way to register it. The Assumed Business Name Registration process is managed by the Secretary of State Business Services Division. Here’s what you need to do:
Prepare and gather what you need
You’ll need the new business name, of course. Make sure you have checked on name availability before trying to register your new name. Vermont won’t all two businesses to have the same name, so you need to make sure no other business is currently using it.
In addition to the new name, you’ll need basic information like the business address, point of contact, and a short description of the business.
Go to the Secretary of State’s website
Visit the Vermont Secretary of State’s website, where you can fill out and file the necessary forms electronically. You can start the process here.
Pay the filing fee
To register an assumed name, you’ll submit a filing fee with your registration paperwork. The fee to register an assumed name in Vermont is $50.
Wait for approval
Vermont reviews applications quickly. Most startup owners hear back within one business day. The only thing that slows down the process is applying to use a name that already exists in the state, so be sure to check on name availability before you submit the paperwork.
You can print and mail the documents, but the approval process will take up to a week.
With an assumed name approved and registered, you can move on to other administrative steps. You might consider launching a website, obtaining an EIN, and checking into required business licenses. Here’s a checklist to use as you get started with your Vermont business.
Launch a business website
Start building an online presence. Having a Facebook, Instagram, TikTok, or Twitter account may not be enough. To look more like a serious entrepreneur, build a website. Start by searching for available domain names and get web hosting once you bought the domain name you want.
It is always better if your domain name is the same as your DBA name, but that cannot always be the case if the domain is not available.
Get the business licenses and permits you need
In Vermont, you are required to register your business. In addition to that, you might need to get business permits to operate, such as zoning permits, liquor licenses, tobacco licenses, and other professional licenses that vary depending on the nature of your business.
Check with the state and county officials to see what you need.
Get an EIN for your business
The IRS issues a Federal Employer Identification Number or EIN for businesses. Not every business needs one, but if you plan to open business bank accounts or hire employees, you’ll need one.
To do so, you can visit the IRS website. After answering a few questions about your business, you’ll be given the nine-digit number instantly.
This number won’t change. It’s like a social security number for your business. It will remain attached to the business for its lifespan.
If you plan to get an EIN, you can do so on the IRS website.
Open a business bank account
With an assumed business name, you can open a business bank account. Having one will allow you to separate the expenses and income that you get from your business from your personal bank account.
Not only that, people you do business with will see your company as more legitimate with a separate account as it adds another layer of legitimacy for your business.
While you’re opening accounts at a local Vermont bank, you might consider opening a savings account too. Many businesses use these accounts to set aside money for taxes or big purchases, like new equipment.
A business credit card can come in handy too. Explore the APRs and benefits that are available to your company.
Understand state tax laws
How will your business file taxes? You’ll need to pay income tax to the federal government and state government on any profits you make. Are you prepared for that? Vermont has its own tax laws and rules for small businesses, so it’s best to speak with a qualified tax accountant to understand how your business is impacted.
Who is a DBA best for?
Sole proprietorships often use DBA names so they can separate their personal name from the business name to protect personal assets. General partnerships use it for the same reason, and so all partnerships can monitor business dealings.
Any type of legal business entity can do business under a DBA, and many do it to build a branded image or because they have multiple niche businesses they wish to keep as separate legal entities. The idea is to keep a DBA name 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?
There are many reasons to get a DBA instead of a limited liability company (LLC) or any other business entity, especially when you are just starting. With that in mind, here are some of the benefits of starting a DBA:
- Having a DBA allows you to apply for an employee identification number or EIN, which allows you to hire employees or freelancers.
- Getting a DBA is the most affordable way to start a legitimate business as a sole proprietor.
- A DBA will allow you to do business using a different name, which also allows you to create a business bank account under an assumed name other than your legal name.
- Existing companies can use a DBA to do a rebrand without having to change their original name, whether it is an incorporation or LLC.
- A DBA offers privacy protection since you can do business under a different name.
- A DBA will make your business more legitimate and trustworthy, which is essential for growing your client base.
Do you have to renew your assumed name in Vermont?
If you want to continue using your assumed business name, you do need to renew it every five years. You can only renew the name within two months prior to its expiration date. The state will notify you when it’s time to renew the name. Don’t ignore this communication. You must renew the name or risk it being claimed by another company.
Can I ask lenders for capital to start a new business in Vermont?
If you have a good business idea with a well-written business plan, you can borrow capital from lenders. There are different types of lenders to choose from. From Kickstarter campaigns, which asks for online donations, to pitching investors, there are many ways to fund a startup.
Are businesses required to file an assumed name in Vermont?
An assumed name is only required in the state of Vermont if you are planning to do business under a different name other than your legal name. However, for other business entities like LLCs, you can do business under the name you selected in your Articles of Organization without filing a separate DBA filing.
Some states require you to publish a DBA in the local newspaper, is it the same in Vermont?
No, you are not required to publish your assumed name in local newspapers in the state of Vermont.
Aside from the filing fee, do I need to pay more on top of the DBA cost?
You might need to pay more if you are filing separate licenses for your business. Some businesses and professions are required to have the necessary permit or business license to operate, which is an additional cost for opening your business.
Does a DBA registration provide liability protection in Vermont?
No. A DBA registration is only a trade name you can do business under. It does not provide liability protection for your business. If you want liability protection to safeguard your personal assets (home, car, bank accounts), you should consider registering an LLC.
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