Choosing the right business name can help build your branding. It can help with such things as your logos, product names, and promotional materials. Your business name can help you stand out from the rest of the crowd and attract repeat buyers. It is very important to have the right LLC name for your business.
There are many reasons for picking the right name for your business. If you’re suddenly feeling that the name you have chosen for your business just doesn’t quite work for you anymore, there is something you can do about it. You can change the name of your business and it’s really not too hard to do.
Table of Contents
- 1 Reasons for Changing Your LLC Name
- 2 When Changing Your LLC Name Needs to be Considered
- 3 Steps to Take When Changing Your LLC Name
- 3.1 Verify if your name is useable or has already been claimed
- 3.2 Create a member resolution or agreement
- 3.3 Amendment to the LLC Articles of Organization
- 3.4 Your new business name needs to be updated with the LLC’s operating agreement
- 3.5 Inform the Internal Revenue Services of your name change
- 3.6 Communication of your name change is vital and should be brought up to date as early as possible. Review the list below of those that need to be informed of your new legal name change:
- 3.7 Change your name on marketing promotions
- 4 FAQ
- 5 Final Thoughts
Reasons for Changing Your LLC Name
A good business name is an important selling asset when you are starting a business. A good name will help your business sell your product or service. Sometimes you think that you have come up with the most fantastic name ever and then come to find out it really doesn’t reflect your business at all.
Maybe your business name is no longer a selling name because your business partner retired or moved away and is no longer contributing. Maybe you have decided to expand into different types of products or offer other kinds of services, so the name really doesn’t reflect what you first started out doing in your business.
Possibly there was a mistake on your paperwork, so you need to correct that name. Maybe you just want to change your business name because it doesn’t fit your business personality or sell your products like you thought it would. There are many reasons that a business name may need to be changed.
Statics show that 90% of all purchasing decisions are made subconsciously, making it vital for companies to choose names that inspire positive decisions.
When Changing Your LLC Name Needs to be Considered
If changing the name of your business is a direction you think will be best for your business, figuring out the right time to make that name change may need to be considered based upon a few key factors. Let’s consider a few questions or thoughts and look closely to some important aspects before you proceed in changing your LLC name.
- How much will the change cost? Changing logos, stationary, business cards, signage and updating your website along with anything that specifically fingerprints your company’s name, needs to be considered and can be an expense that you need to take into consideration when changing your LLC name.
- What are the pros and cons of a business name change? Cons may include a significant amount of work, thoroughly considering every aspect of the change before proceeding. This could include the cost and coordination of changing your LLC name. Some pros may involve growing or deepening consumer trust and increasing your profits by changing your LLC name.
- Have you considered applying for a DBA? You can always file for a DBA or “doing business as,” form. This is also known as a fictitious name, trade name or an assumed name in some states. Applying for a DBA will allow you to drop the LLC part and just use your desired business name. Using a DBA allows you to run your business covered by a name that you prefer to use without changing your legally filed business name. Filing a DBA is a relatively simple process and not too expensive. It could be the perfect solution for your company if there is no other reason to change your legal name.
Here are some common reasons why a name change may be considered:
- Entering into a new field of services or products: Sometimes it’s wise to freshen up your brand especially if the current name is in any way holding you back.
- Needing to change your name because of a trademark situation: Trademark issues usually require a name change for your business. If you have received a cease-and-desist letter, you need to immediately work on getting your business name changed as soon as possible.
- Your LLC name was filed incorrectly on the Articles of Organization: In this case, you may not have any other choice but to change your name, simply to correct it.
Steps to Take When Changing Your LLC Name
Before taking these steps to change your LLC name, you need to look at your LLC’s operating amendment or bylaws. You may be required to get written consent from the members, shareholders, or owners. Each state may have different requirements in getting approval for changing a company’s name.
Verify if your name is useable or has already been claimed
It is important to verify if the new name that you are considering is available. Your name change request could be rejected by the state if it’s similar to another LLC within your state, especially if you are providing similar services or products. There are several websites available to help you search for trademark names so as not to be using a name that already has been chosen.
Create a member resolution or agreement
It is important to document your name change. Obtain a written agreement stating that all your LLC’s owners approve of the name change. The written resolution is a record of approval and should be placed with other LLC’s important corporate documents. This written agreement is your official document, so it needs to be considered a high priority and put in a safe place.
Amendment to the LLC Articles of Organization
File the Articles of Amendment, also known as an amendment to the Articles of Organization, at the secretary of state’s office or it can be done online, along with a small fee. This step is usually required to be done within 30 days of your written resolution. You will be expected to pay a fee which will vary with each state for filing. Typically the cost can be between $20 to $150. There are several websites available to help with this process.
Your new business name needs to be updated with the LLC’s operating agreement
Upon approval from the state, it is best that the LLC update any operating agreements necessary with its new LLC name.
Inform the Internal Revenue Services of your name change
The IRS has several different requirements, depending on your type of business. In most cases it’s fine to just do this on your next tax return. The tax form gives you an option to let the IRS know that your business name has changed. Form 1120 ( On page 1 of Form 1120, line E, Box 3) If you have already filed your tax return, you should contact the IRS by writing and sending it to the same address where you filed your return. Be sure to check out the IRS website for any specific or additional requirements that may appertain to your LLC name change.
Communication of your name change is vital and should be brought up to date as early as possible. Review the list below of those that need to be informed of your new legal name change:
- Banking entities – new checks will need to be ordered with your new LLC name
- Vendor and distributor accounts
- Clients – let them know that a name change is coming soon to your company and tell them why, if you would like. Keep it simple, but exciting
- Credit cards used specifically for your business
- Your property records within your county
- Insurance companies and your policies
Change your name on marketing promotions
It’s surprising how many places you will need to update to get the word out so that everyone knows you by your new LLC name. Everywhere your new name is – use the term “formerly known as” for at least 6 months, if not a full year so you make the transition easier and the old company doesn’t get confused with your new company. Here’s what you need to change:
- Any signage exhibited in your store or office
- You will want your accounts updated on your social media
- Check your review directories and websites for needed name updates (such as Facebook, Google, Yelp, TripAdvisor, Angie’s List, etc.)
- New brochures with the new name will need to be ordered
- Proposals will need to be updated with your new name
- Business cards should be ordered quickly
- Letterhead stationery is always fun to see unveiled
- Promotional merchandise (mugs, pens, t-shirts, and other novelty items)
Also, a new logo design might be a consideration if the one you are now using is connected to your old business name.
Perhaps your LLC’s name was filed incorrectly on its Articles of Organization. To correct your business name, you will be required to fill out a Statement of Correction. This is sometimes called a Certificate of Correction. However, the LLC must pay the associated fee to file the correction.
Below is some information usually asked on a Statement of Correction. Be sure that you have all the right information needed to make these corrections.
- LLC name (as currently exists in the state’s record)
- The document being corrected
- The date the document was filed
- What was incorrect on the document
- Why or how it came to be incorrect
- The correction requested
- Signature of an authorized individual (e.g., an LLC member or a third-party given rights to file the corrections of the LLC)
If you’re thinking about changing your LLC’s name, it can be a nerve-racking experience. These frequently asked questions may put you at ease when it comes to how and why you should change your name.
Answer: EIN stands for Employer Identification Number. No, you don’t need a new EIN if you change your LLC name or even if you change the address of the business. Just let the IRS know of the changes and they will adjust their records accordingly. All that matters is that your EIN is connected to the correct business name.
If you are unsure about needing to file for a new EIN be sure to check out the IRS website.
Answer: Once you change your business name, it’s advisable to add the LLC at the end of the name. One, it shows that your company is real and that you are registered with the Secretary of State. Two, it also shows that your personal assets are protected if your company was to be sued. If you’d rather not add LLC to the end, you may want to consider filing a DBA so you can operate legally under a business name that doesn’t require LLC at the end.
Answer: Consider filing for a DBA name. A “doing business as” or DBA gives the LLC the legal right to use another name for marketing and business operations. Consult an attorney if you have any concerns about filing for a DBA.
Answer: It can be an involved process to change your company name because of all the expense that goes into changing logos, updating your website, getting new business cards, and everything else that goes along with it.
Beyond that, you need to think through the process thoroughly, nail everything down that needs to be changed, and inform everyone of the change. Make sure your bank knows that you’re going to be receiving checks made out to the old name for a while and to go ahead and accept those checks along with the checks that have the new name referenced.
Other than getting things prepared for the name change there really isn’t any downside to changing your business name. Clients generally aren’t upset, concerned, or confused. Most people don’t care about the name change as long as you do your part to let them know of the change and remind them for a six-month time period of both names.
If you feel that you need to go ahead and change your LLC name, the best time is when the benefits outweigh the cost and will help your business to grow. It’s always advisable to consult with an attorney to help determine what will work best for you and your unique situation.