Forum Moderators: phranque
My company is a relatively new start-up (~1.5 years old) and we originally registered our company name as XYZ Technology, Inc. in the state of Maryland (USA). After being in business for this time, we have now decided that we want to be known as XYZ Corporation (we do not want to be limited to strictly "technology" anymore).
Since we have already registered as XYZ Technology, Inc. one option for us is to simply keep this as the Legal name, and just apply for a D.B.A. ("Doing Business As") as "XYZ Corporation." This would take a lot less manpower. Plus we would still be able to use the current business cards and checkbooks that we have until they run out.
However, some of us feel that it is better to just change our legal name instead of just applying for a D.B.A. and keeping the old name, as we will probably want to do it anyway some time later if not now, and in the long run it might be better.
I was wondering if anyone can tell me what the common practice is by most companies that have ever had to undergo this process, and which option is recommended. Any advice is appreciated.
Thanks!
In addition, if you choose to go new, check with a CPA and really understand the tax implications - especially the timing. If you really must change, I personally would dissolve the old corp on Dec 31, and start the new corp on Jan 1 (if you are on a calendar year basis).
Hope that helps, WFN
I would definitely go with the DBA. Why? If you choose to change your incorporated name, you are in essence starting all over. You would have to desolve the old corp, close all the books, pay all your suppliers, and close your old bank accounts. Then you would have to re-apply for any credit your old company had established, including bank loans and supplier open-accounts.
In most (if not all) states you can just file an Amended Certificate of Incorporation and change the name -- you don't have to dissolve and form a new corporation. Your credit and existing contracts stay in place, just as they would if you changed your own name.
Probably one of the most important things to consider is your federal Employer Identification Number (EIN). Over the years I have added DBAs to various corporations, which are quite transparent. I don't recall ever doing a name-change on the EIN.
As you know, the EIN is basically a corporation's social security number, and is used for your checking accounts and all federal tax filings.
Although the DBA seems to be the easiest, I would check with your corporate attorney to see if an EIN name change is possible. As far as banking and deposits, I doubt if you would have much problems depositing any XYZ Technology, XYZ Corporation, or XYZ 'anything', as long as the "XYZ" stays the same.
It would appear that JayC has a good solution for the Corporation name istself (filing an Amended Certificate of Incorporation and change the name).
one option for us is to simply keep this as the Legal name, and just apply for a D.B.A. ("Doing Business As") as "XYZ Corporation."
Actually, I don't think that is an option in this case. A "dba" or assumed name, as I understand it, can not include terms like "Corporation", "Incorporated", "Limited", etc. You have to actually be incorporated under the given name in order to use those.
JayC, I believe that only applies if you are not incorporated to begin with, and implying that you are, via the DBA.
More people can expand on this, but it is my understanding that you may not use any word that will imply your company is a different type of entity, i.e. you may not use "Inc", "Corp", "Ltd", "LLC" as the ending of your DBA name, if your company is not incorporated.
Thanks again, and I will post the results of my investigation.
...This forum is really helpful!
