Trade names refer to business entities such as the names of nonprofit, charitable, religious, and educational institutions; the names of sole proprietorships; assumed names; corporate names; fictitious names; and partnership names. Businesses must legally list their trade name with the state depending on the structure of the entity. Generally, corporations must register their businesses with the secretary of state or corporation commissioner's office of their respective state.
Purpose of Registering a Trade Name Legally
Legally requesting a trade name allows members of the public to verify the ownership of a particular business. Furthermore, the registry serves to eliminate the duplication of trade names. In some cases, such duplication may not be prevented due to the invalidity of some searches or trade names as being unique.
Corporate Name Registration
When registering a corporation you would be required to file articles of incorporation; pay a fee; select a board of directors; register the corporate name with the secretary of state, state department of corporations, or corporations commissioner. Laws vary from state to state when it comes to registering a corporation. Therefore, it is essential to check with the respective authorities in your state to verify the requirements.
If you’re registering a corporate name, you must fulfill these three steps.
- Select a name. This name must include the word or an abbreviation indicating the business’ status. Such words include corporation, incorporated, company, or limited. This rule is applicable for all states with the exception of Maine, Nevada, and Wyoming. There are some states that requires the business name to be in English or Roman characters. If your corporation is designed for a specific purpose you must ensure that the name is in alignment with this purpose. Take for instance, if your business helps homeless children to find shelter, you may not want to name your business Car Fixers Inc.
- Make sure that the name you select can be easily set apart from other corporate names in your state. If your name is very similar to one that already exists in your state, you would not be able to proceed with your registration until you select a different name. To avoid such setbacks you may search on the secretary of state’s website in your state to find out if that name has already been taken. In other cases, you may call the secretary of state directly to inquire about the proposed name, or pay for a search to be done. If you prefer to skip the search process because you’re certain that there isn’t any existing businesses with your proposed name, you may do so and submit your articles of incorporation. Your application may be rejected if your business has the same name as an existing one.
- File a name reservation. This can be done before your articles of incorporation is submitted to the secretary of state. Once the corporate name is reserved, others will be prevented from using that name during its reservation period. This period usually lasts 60 to 120 days depending on the state where the name is reserved. Some states also allow you to extend the name reservation period.