If you run a business under an assumed name in Vermont, you may want to set up a DBA. Short for “Doing Business As,” a DBA serves as an alternate title for your business. Often, a DBA is the name customers will use to refer to your company. In this guide, we’ll cover everything you need to know about DBAs: who needs one, who doesn’t, and two easy steps to filing with the state.
In Vermont, the DBA is actually called a “Trade Name.” Essentially, they’re the same concept. “Trade Name” is just the terminology used by the state. For consistency, we’ll call it a Trade Name throughout the rest of this guide.
NOTE: Keep in mind that filing a trade name will not give your business protection through the corporate veil like an LLC will. If this is something you want or need, don’t fret, there are many top rated LLC formation services that can help you take care of the paperwork.
Do You Need a Vermont Trade Name?
Not all business entities in Vermont need a Trade Name. Ordinarily, a business needs a Trade Name when the name of their business differs from the name registered with the state.
So let’s say that Lauren operates a sole proprietorship; her legal business formation documents list her full name as the legal owner of the business. But if she wants to run her shop under the name Sew Sweet Creations, she’d need to file a Trade Name in order to use that name. A Trade Name is also useful for corporations which want to establish additional businesses or locations with a name that’s different from the Corporation name.
Limited liability companies, nonprofit corporations, and corporations operating exclusively under the name on file with the state usually do not need a Trade Name. They may choose to use one if they want to establish a new product line or chain of businesses under their original parent company.
A Vermont Trade Name does present a few advantages. While it doesn’t offer any specific legal protections or tax incentives, a Trade Name allows you to get a business bank account. You can also give your customers peace of mind—most people are more comfortable writing a check to a business than an individual.
All entities which are using a name different from their legal business name are required to register their Trade Name. The only exceptions to this are sole proprietorships which use their legal name as a part of their name, such as “John Smith’s Construction” owned by “John Smith.” All others should register.
1) File Your Trade Name with the Vermont Secretary of State
In Vermont, all Trade Name filings are processed by the Secretary of State. However, before you file it, you should make sure the name is compliant and available to use. Vermont has requirements that each new name is distinguishable from the names already on file with the state.
In some states, the standard “distinguishable” only requires one or two letters of difference. However, Vermont law states that names cannot be confusing to consumers. If you worry that your name could cause a mix-up between you and other entity, then your name is probably too similar.
To learn whether or not your name is available, you should run a Business Name Search. You should use the “Exact Match” filter and then type in the exact name you hop to use. If any exact matches appear, then it’s likely your name is available.
Next, you’ll need to complete your register your Trade Name. You can complete this process online easily. You can also request the paper forms from the Secretary of State if you’d rather file by mail.
There is a $50 filing fee for this application. If you choose to complete the filing online, you’ll need a credit card.
2) Maintaining your Vermont Trade Name
Vermont Trade Name registrations are valid for five years. If you want to continue using your name after that, you’ll need to file a renewal. You may only renew within the two months leading up to your expiration. Renewing costs $40.
If you ever need to make changes to your name or stop using it, you’ll also want to alert the state of those changes, too. Please note that those changes still need to be distinguishable from names on the record.
Need Help Filing your Trade Name?
If this process sounds like a hassle, you can get help with setting up your business’s name with a service like Legalzoom. They make the process simple: you simply provide them with the necessary information about your company, and they’ll fill out the paperwork so you don’t have to. The process is both easy and affordable, letting you focus on running your business.
Conclusion
Your name is an important part of your business, but keeping compliant with state requirements can be tricky! We hope this guide made it quick and easy to set up your Vermont Trade Name.