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, fictitious names are one type of business name that can get a bit confusing. So if you’re wondering what a fictitious 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 Arkansas fictitious names so you don’t have to sort through the legal jargon and focus on what really counts: your business.
Important Tip
What is an Arkansas Fictitious Name?
A fictitious name—often called a DBA or trade 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 fictitious 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 fictitious name. Because of this scenario, fictitious names are most commonly used by unincorporated entities.
That said, many corporations and LLCs also choose to use fictitious 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 fictitious name for it. Corporations might do something similar for new product lines, too.
But that’s fictitious names in a nutshell!
Is fictitious name registration required in Arkansas?
If you intend to use a fictitious name in Arkansas, then you are required to register it. But don’t be fooled into thinking that registering gives you exclusive rights to that name. Arkansas allows multiple businesses to operate under the same fictitious name.
This isn’t ideal (some states protect registered names), but since it’s required, you’ll need to register your fictitious name.
Benefits to Registering an Arkansas Fictitious Name
There are several benefits to registering your fictitious name. Most importantly, registering ensures that you comply with state requirements. But registration also ensures that your name is a part of public record, which is essential so the public can know who the people are behind each business name.
One benefit you might not think of right away is that a fictitious 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 fictitious name gives your customers peace of mind. It’s not uncommon for customers to write checks, right? Without a fictitious 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 fictitious name gives your business an extra layer of legitimacy.
Register your Arkansas Fictitious Name in 3 Steps
1. Check that your fictitious name doesn’t infringe on any legally protected names.
Before you register a fictitious 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 Arkansas
- Names that have been reserved for later use by another incorporated entity in Arkansas
- Names that are protected by U.S. trademark law
The Arkansas Secretary of State will automatically reject your fictitious name if it infringes on other protected names 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 Corporation Entity Search. This is your way to check the state database for any exact matches to your fictitious name. As a general rule, if you search your desired trade name and the tool pulls up any matches, you’ll need to change your name.
Resource: Need help with the Corporation Entity Search? Check out our full name search guide here.
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 Corporation Entity 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 Arkansas. 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 fictitious name application.
Arkansas makes the actual process of registering your fictitious name pretty simple. All you have to do is fill out the Application for Fictitious Name form and pay the appropriate filing fee. Arkansas charges a different amount based on your entity type. LLCs, for example, pay a $25 filing fee.
Once you complete that step, your fictitious name is yours indefinitely; fictitious names in Arkansas do not expire.
3. Declare your fictitious name with your local county clerk.
Some states, Arkansas included, require you to register your name on both the state and local level. This step is essential, and unfortunately, it sometimes goes overlooked. We can’t list a ton of prices for this declaration, though; every county has its own forms and filing fees.
Our advice? Get in contact with your local government and learn what steps you should take to register your fictitious name. Your local county clerk will be able to tell you exactly what you need to do.
And last but not least, keep in mind that if you operate in multiple counties, you’ll have to declare your fictitious name in each.
Other Considerations for Your Fictitious Name
Now that you’re a proud owner of an Arkansas registered fictitious name, there are a couple things to keep in mind.
Most importantly, you should note that a fictitious 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 fictitious 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 fictitious name for those protections.
Next, keep in mind that registering a fictitious 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 Arkansas, you’ll follow Arkansas law and federal (national) law for businesses. Louisiana, for example, has no jurisdiction over your business unless you choose to expand into Louisiana. This affects business names, too.
If you want to protect your fictitious name or legal name outside of Arkansas, 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.
Conclusion
Important Tip
Fictitious 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, paying the filing fee, and declaring your name with your local county clerk. Hopefully this guide has taken away some of the guesswork to Arkansas Fictitious Names.
If you decide that forming an actual entity is right for you, we recommend forming an Arkansas LLC for most small businesses and entrepreneurs. You can either register it yourself or hire an LLC filing service.