How Many DBAs Can An LLC Have?
Whether it’s how we are wired or it’s just a mutation, most small business owners constantly see new business opportunities and are often considering starting new businesses.
Another common trait for entrepreneurs is to not spend money if we need to, so we get a lot of questions asking whether it’s possible to have multiple DBAs (Doing Business As) under one Limited Liability Company (LLC). It’s easy to see why, as having multiple DBAs allows them to test their new business idea and retain the personal liability protection of their existing LLC, without having to pay to set up another entity.
Before providing the answer, there are some things to consider before choosing to operate multiple businesses under one LLC. In this article, we’ll explore the pros and cons of having multiple DBAs under an LLC, and dive into what steps you need to take to make it happen. So read on to learn more!
What Is a DBA?
A DBA, or “Doing Business As,” is a name that a business (in this case an LLC) can operate under that is different from its legal name. Depending on the state the name is being registered, it may be called a Fictitious Business Name, Trade Name, or Assumed Name.
For example, when first forming the LLC, the legal name of “John Doe Enterprises, LLC,” was registered. In some cases, as time moves on, the original name doesn’t fit what the business does anymore, but in other cases, the business owner may want to operate another business under their existing LLC.
Regardless of the reason, to legally operate a business using a different name than the one that was legally registered, a DBA will be necessary.
Related: How to register for a DBA
Is a DBA the same thing as an LLC?
No, a DBA is not the same thing as an LLC. A DBA is just a name that the business can operate under that is different than the legal name of the company. An LLC is a business entity that offers protection to the business owner’s personal assets in case the business is sued.
Am I required to register a DBA for my LLC?
The answer to this question depends on whether you need a different name for the LLC to operate under.
When initially registering for an LLC, the Secretary of State (or similarly named state agency) requires the new LLC to find a name that isn’t being used by another LLC in the state. If you are fine operating under this name, nothing further is needed.
If you want to operate an LLC under any different name, a DBA will be required.
Can an LLC have multiple DBAs?
Yes, every state allows for an LLC to operate under multiple DBAs.
So, If you want to operate under a different name, say because you want to change the name of your business, start another business, or begin selling a line of products under a different name, a DBA will need to be registered.
How many DBA names can I register?
There are no limits to the number of DBAs that an LLC can register.
Is it better to have 2 LLCs instead?
While there isn’t a limit to the number of businesses that can be operated under one LLC, there is one significant consideration when deciding if having multiple DBAs or separate LLCs is better.
Liability protection is perhaps the most important benefit of a Limited Liability Company. While running multiple businesses under one LLC won’t change the personal asset protection it provides the owners, the risk to the businesses increases.
What this means is that if there are two businesses operating in an LLC and Company A is sued, then the assets of Company B are at risk. For many people, trying a new idea out to see if it will work before investing in an additional LLC brings a small amount of liability risk. However, if you plan to operate two businesses together over the long term, it’s important to look at the risk each business has on the other. The last thing you would want to do is lose both businesses due to legal issues from one business.
There are additional costs to having multiple LLC as there is the state filing fee, annual fee, and additional tax returns to file
Related: Guide to forming an LLC
How do I set up multiple DBAs for my LLC?
Each state is different, but generally, the first step requires verifying that the new name isn’t being used by another LLC, just like when originally registering the LLC.
Related: How to do an LLC name search
Once you know the name you want is available, a DBA registration form will need to be filed with the Secretary of State’s office. The form may be called Application to Adopt an Assumed Name, Fictitious Name Registration Form, Assumed Name Certificate Form, etc.
The cost to register a DBA for an LLC will vary by state, however, there will be a recurring fee to keep the name active.
What About a Series LLC?
If there is some liability concern of having two businesses operate in one LLC, but forming two LLCs is an option you would rather avoid, the Series LLC is a different legal entity that could be an answer.
A Series LLC allows you to operate separate companies under one legal entity. With a series LLC, you have a parent LLC and can have several “individual LLCs” underneath the umbrella.
Similar to operating multiple LLCs, each series can have its own Employer Identification Number (EIN) and business bank account.
Not every state offers a Series LLC, but could be an option worth considering.
Related: What is a Series LLC?