Name Change

[Hoosier]

Getting ready to do some research on this issue but thought I would throw it out to the community first. Client started new limousine business in 2009. Got a Tax ID number, registered with state as an LLC and jumped through all the Dept of Transportation hoops. After conducting some additional marketing research, client finds that nationwide there are many other limousine companies with the same name and many with a similar name.

The client is interested in changing the name of the company but this raises some questions. Can the company keep the same Tax ID number but change the company name? Will the Secretary of State allow a name change? Will the DOT allow the name change but allow the assigned DOT number to remain unchanged? I'm beginning the research process now but thought if anyone has been through this before perhaps they could offer some advice.

[erchess]

D B A

What if he simply registered with the local government that he was doing business as Newname? I have no idea how that is done in IN but in NC you go to the tax office where people pay city and county property tax, pay a small fee that a business is supposed to pay anyway, and let them know you're doing business as whatever. This btw is also the procedure when you don't want to bother to trademark or copyright or whatever your business name. In that case you are Owner or Owners DBA whatever.

[AuditorTurnedGood]

I would suggest a DBA

and notify both the state and feds of the change. I have a client whose attorney talked him into forming a new S-Corp to do essentially the same work under a slightly different name -what a mess to clean up this year.

ATG

[Lion]

Amend

I filed an amendment of my organizational papers with the CT secretary of state to change my name, same LLC with amended name. In fact, in the state database of businesses, one of the prominent buttons is "name history." It cost me the same fee as the original organization.

[JohnH]

I also think the name change at the state level is preferable to the DBA for a corp or an LLC. For corps, it's fairly easy to file Articles of Amendment (cost is $50 in NC) - the fees may be more or less for LLC's but I assume the process is essentially the same.

The OP said you got a Federal ID# and formed an LLC, but I'm assuming the formation of the LLC came first and the Fed ID# was obtained in the name of the LLC. If so, then if you change the name but the entity stays the same, there's no reason to get a new Federal ID#. I've changed the name on several corp returns over the years - all I did was attach a copy of the approved Articles of Amendment to the return for the year the change is made. I have no idea how this would affect DOT - probably would be a good idea to discuss it with them before moving forward on anything.

[erchess]

Name Change with Stae or DBA

In all probability the cost is insignificant to the business but the Name Change DOES have a cost that would not otherwise exist and the DBA DOES NOT.

The Name Change requires paperwork (if only electronic paper) that would not otherwise be necessary and this too has a small cost payable in the owner's time or in money.

I want to be careful not to overstate the small advantages I see to DBA but I simply see no advantage to the Name Change. On the other hand I'd be the first to say that everyone else who has posted in this thread knows more about Corporate and LLC issues than I do. So I'm assuming that John H and Lion see some advantage to Name Change that ATG and I do not. Would you mind telling me what that advantage is? And ATG would you chime in please along with anyone else on either side. I want to sit and listen and take notes.

[Lion]

Not much

Nothing special. I just didn't want to deal with two separate names for different sets of reporting.

[erchess]

TY Lion

I have seen (not done) returns where the name was simply "some silly something dba a cool name that makes sense for the kind of business it is:" (Obviously a lot shorter in real life.) For example (no kidding) a partnership started out making solar hot water heaters and when that flopped they opened a hot dog stand with a dba.

[JohnH]

I'm going by what a lawyer told me years ago, and that may be outdated or esoteric for all I know. He insisted that a corp should always effect a name change by filing Articles of Amendment with the Secretary of State rather than registering a dba with the local county. Something about exposure to being accused of deceptive business practices in the event a legal problem arises. He insisted that dba registration should generally be used only by unincorporated businesses such as sole proprietors and partnerships. (At that time, LLC's were not much in vogue).

Whereas the dba is recorded only in the county of operation, the Sec of State maintains a registry of the corporations to which it has granted charters statewide, along with their registered agents. That is generally regarded as the place to keep the record straight in legal circles, especially if someone wants to take legal action against the corp. Nobody wants to get sued, but if it does happen then you want to be sure they actually go after the corp and that you don't give them some silly reason to drag the shareholder(s)/officers(s) into the mix.

Also, a dba may accidentally infringe upon a name already owned statewide and the local county won't catch it because all they do is register the form. But if Articles of Amendment are filed, the Sec of State must clear the name against other corps already in their data base. Sometimes stepping on somebody else's name can be a big deal.

In NC, a corp can change its name by holding a shareholder meeting & passing a resolution, then filing Articles of Amendment with the Sec of State along with a $50 fee. That's it. You get statewide clearance of the name and you've done things all neat & legal. Given that registering a dba probably costs $10-$20, there just isn't enough of a cost difference to justify taking the chance. (BTW, I looked up Indiana which was where the original post is located - their fee for Articles of Amendment is only $30 for corps)

[erchess]

As I suspected

someone knows more than I do. Many thanks John H for enlightening me and I suspect others. I hereby concede that my earlier advice was in error and the client in OP should file a change of name with the Secretary of State after the board so votes.