There are dozens of decisions to make when you start a business, but one of the most important ones is your business name. Some might even say that it’s harder than naming a baby. After all, the government doesn’t give “rules” about what you can name your children. They do give rules for business names.
Thanks to those legal regulations, trade names are one type of business name that can get a bit confusing. So if you’re wondering what a trade name is, if you need one, or how you can get one, you’re in the right place. In this guide, we’ll cover all the essentials to Wisconsin trade names so you don’t have to sort through the legal jargon and focus on what really counts: your business.
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 good LLC services in Wisconsin that can help you take care of the paperwork.
What is a Wisconsin Trade Name?
A trade name—often called a DBA or fictitious name or assumed name—is a type of business name. More specifically, it’s a fake name used by a business, much like you might use a nickname around family and friends.
A bit more technically, a trade name differs from the business’s legal name. Here’s where it becomes important to note what kind of entity you’re running.
For example, let’s say Lauren Smith operates as a sole proprietorship. From a legal standpoint, her business is indistinct from her own person. So her business’s legal name is, well…Lauren Smith. Not many people want to call their business by their own name.
Lauren sells handmade baby clothes, so she decides to name her shop “Sew Sweet Creations.” Unless she incorporates as an LLC or corporation, she’d be using a trade name. Because of this scenario, trade names are most commonly used by unincorporated entities.
That said, many corporations and LLCs also choose to use trade names. For example, a local restaurant, “Becky’s Bistro,” might want to expand across their county, with a slightly different name for each location. Instead of creating a new LLC for the new locations, Becky might get a trade name for it. Corporations might do something similar for new product lines, too.
But that’s trade names in a nutshell!
Is trade name registration required in Wisconsin?
Wisconsin, unlike the majority of states, actually doesn’t require trade name registration. But we recommend doing it anyway. Here’s why: technically speaking Wisconsin grants “ownership” of a trade name to the first person to use it. But if there’s ever a legal dispute regarding your rights to a name, Wisconsin will ask you to prove that you were the first to have the name. You can, of course, use business letterhead, business bank account statements, and similar documentation. But a trade name certificate would serve as a huge mark in your favor to prove that you had the name first. The last thing you want is to endure legal hassle with your business name, so we highly recommend registering.
Benefits to Registering a Wisconsin Trade Name
There are several benefits to registering a trade name. Like we’ve just mentioned, the registration gives you proof that you had the name first. But it also adds your name to the public record. For one, being on the public record helps the general public know who’s doing business under a given name. But future would-be trade name registrants will see your name, too. And if they see it, they’ll be sure not to use the same one, discouraging any name disputes.
One benefit you might not think of right away is that a trade name allows you to get a business bank account in that name. This isn’t a necessity for many entrepreneurs, but from an accounting standpoint, it’s really helpful. You can keep all your “business funds” in one place, separate from your personal funds. That’s a good habit to start from the get-go (especially if you ever intend to become an incorporated entity later).
On a similar note, a trade name gives your customers peace of mind. It’s not uncommon for customers to write checks, right? Without a trade name, they’d write the check to you personally. Some people are leery about that. But thanks to a business bank account, Lauren can tell her customers to make their checks out to “Sew Sweet Creations.” It’s just a psychological thing, but a trade name gives your business an extra layer of legitimacy.
Register your Wisconsin Trade Name in 3 Steps
1. Check that your trade name doesn’t infringe on any legally protected names.
Before you register a trade name, you have to do your homework to ensure that you actually have clearance to use that name. Here are a few of the names you cannot use:
- Names that are already in use as the legal names of any corporations, LLCs, and other protected entities in Wisconsin
- Names that have been reserved for future use as the legal names of incorporated entities
- Names that are protected by U.S. trademark law
The Wisconsin Department of Financial Institutions will automatically reject your trade name if it infringes on other names registered in the state. They won’t check the U.S. Patent and Trademark Office’s database for you. That’s why it’s important to complete a few different searches.
First, you’ll need to run a Corporate Records Search. This is your way to check the state database for any exact matches to your trade name (Note: this database only includes legal names of incorporated businesses; since trade name registration is not required, the state does not maintain a database with all trade names in use in the state, only the registered ones). As a general rule, if you search your desired trade name and the Corporate Records Search pulls up any matches, you’ll need to change your name.
Next, we recommend searching the U.S. Patent and Trademark Office’s trademark database. Even though trademarks are usually regarded as visuals or logos, any names and text included within those visuals are nationally protected. That means no other names or visuals in the entire United States can’t be the same or similar as a trademarked name.
There are plenty of examples of different small businesses being taken to court for infringing on the name of large international chains, but we won’t get into them. Just rest assured that you’ll be doing yourself a big favor by ensuring that your name is completely unique.
Another optional search is just your tried-and-true Google search. This won’t give you any systematic, organized results like what you’d get from the Corporate Records Search. But it will give you insight into names being used everywhere.
For example, you might find that your desired name is being used by another business in a neighboring state. That’s fine as long as the name isn’t trademarked and you intend to run business exclusively in Wisconsin. But if you have any aspirations of expanding into other states, you’ll want to know what names are in use there.
2. File the appropriate trade name application.
As of 2020, Wisconsin has moved the entirety of their trade name application process to their online portal. So registering a name (should you choose to) is really as easy as logging in and filling out the online application. This application costs $15 to file. You can also apply for a trade name in person, if you’d prefer. But if you’re looking for a downloadable form, you won’t find one on the Department of Financial Institution’s website.
After you complete the application and pay the filing fee, your trade name is set to go.
3. Renew your trade name.
In some states, a trade name lasts forever. And in Wisconsin, it might feel like the name lasts forever; each registration is good for 10 years. If you want to continue using the name after that ten-year period expires, you can, but you’ll need to file a renewal.
Renewals are simple, too: you essentially re-file the same form you filed to begin with. Simply log into the Department of Financial Institution’s website, fill out the form (or visit the office in person), and pay another $15 filing fee. Then your name is yours for another 10 years.
Other Considerations for Your Trade Name
Now that you’re a proud owner of a Wisconsin registered trade name, there are a couple things to keep in mind.
Most importantly, you should note that a trade name does not give you any personal asset protection. That’s a perk that comes with incorporating your business, such as forming an LLC or corporation.
If you already are (or you’re thinking about forming) an LLC or a corporation, then you get personal asset protection and even privacy through a registered agent service. This means that if something ever goes wrong with your business, your personal belongings—your car, your house, your personal savings account—are protected. Creditors or legal plaintiffs cannot touch them.
That protection is not available to unincorporated entities like partnerships or sole proprietorships. Moreover, applying for a trade name does not grant you that protection. In these cases, if something went wrong with your business, you’d have to pay any debts out of personal funds. So please don’t rely on a trade name for those protections.
Next, keep in mind that registering a trade name doesn’t prevent businesses in other states from using that name. The same applies for business’s legal names, too. We won’t get too technical with this, but each state governs its own businesses with no effect on businesses in other states. So as a businessperson in Wisconsin, you’ll follow Wisconsin law and federal (national) law for businesses. Illinois, for example, has no jurisdiction over your business unless you choose to expand into Illinois. This affects business names, too.
If you want to protect your trade name or legal name outside of Wisconsin, you do have options. Foremost among them is applying for a trademark with USPTO. If that’s something you’re interested in, we recommend seeking additional legal counsel. Trademarks are a very complicated (and expensive) process, and a lawyer will help you conquer every aspect of the application.
Trade Names might sound a bit complicated, but they don’t have to be. As long as you follow the proper state guidelines, it’s actually as simple as filling out the form and paying the filing fee. Hopefully this guide has taken away some of the guesswork to Wisconsin trade names.
If you decide that forming an actual entity is right for you, we recommend forming a Wisconsin LLC for most small businesses and entrepreneurs. You can either register it yourself or hire a WI LLC filing service.