DBA in South Dakota
A good name helps businesses entice potential customers, stay in the minds of those who have tried their services, and create a lasting impression even though people haven’t entered the store yet. However, the naming process is influenced by the business’s structure. Sole proprietorships and general partnerships, for example, use their owners’ real names as the business’s legal name. LLCs, LLPs, and corporations are also limited to the legal name used to register the entity when it was still being formed.
Thankfully, there’s a way for businesses to use another name: DBAs. If you’re running a business in South Dakota and would like to use another name for it, Doing Business As is the answer you’re looking for. Let’s discuss what that is and how you can get one for your business.
What Is a DBA?
A DBA, which stands for “Doing Business As,” is a fictitious name used in place of your business’s actual legal name. It’s like a business nickname that you can use for various reasons and purposes. DBAs are called fictitious business names or trade names in other states. In South Dakota, however, the government refers to them as “assumed names.”
Regardless of how they are referred to or what state they are used in, DBAs do the same thing. Assumed names are not entities separate from your business. Instead, they are legally-registered aliases you can use to give your business a fresh identity you can present to your customers.
What Are The Advantages Of A DBA In South Dakota?
South Dakota DBAs give local businesses several key advantages that can help them grow and reach more customers. Here’s a quick look at each benefit:
It helps create branding
DBAs are useful when creating your own unique brand for your business. If you’re a sole proprietor, for example, you can select the name that you want instead of putting your name in your signages and posters. The same principle applies to businesses with other structures.
You can also use DBAs to create a uniform brand across a number of branches. Sioux Falls-based drug store Lewis Drug operates 45 branches in South Dakota, Minnesota, and Iowa. These branches are either named Lewis Drug or Lewis Family Drug. Regardless of the location, the branding and associated service remain the same.
It adds more privacy to your businesses
DBAs provide your business with an added layer of privacy, as owners can hide their names from the public using a registered DBA. For example, instead of placing their names on the material used to promote their businesses, sole proprietors can place DBAs on posters, flyers, pamphlets, and so on.
It helps you diversify and expand
Businesses looking to expand or try out new ventures can use DBAs for that purpose. Instead of forming another business entity and going through the process of its upkeep, you can simply file a DBA for each venture but list them as part of your primary business. It’s even easier doing it this way!
An example of this is Dakota Style Chips, Inc., a snack food company based in Clark, South Dakota. Initially, the company started with kettle-cooked potato chips but later expanded its product line to include flavored popcorn, sunflower seeds, and sunflower kernels. To market these newer products effectively, the company began doing business under the more general but popular brand name “Dakota Style.”
It is used for banking purposes
While the state of South Dakota doesn’t require you and other businesses to get DBAs unless you plan to do business using another name, banks sometimes do. Having a DBA also allows you to keep your personal and business finances separate, which is essential for financial clarity and organization.
Additionally, if you have multiple ventures, each with its own DBA, it becomes easier to segregate and manage the finances for each of them separately. This helps you keep track of the financial performance of each venture individually, making it more efficient to monitor and plan for its success.
What Are The Disadvantages Of A DBA In South Dakota?
Although DBAs bring many benefits to their owners, they do not have downsides that could negatively affect the businesses using them. That said, they do have some limitations you should know about.
First, assumed names do not provide any personal asset protection in the event that your business gets sued. South Dakota LLCs and corporations provide this protection, so if you have one of these business structures, you are already covered. If you run a sole proprietorship or general partnership, however, you should seriously consider getting insurance to protect your assets.
Next, while your DBA can be as unique and creative as you want them to be, it has to abide by South Dakota’s naming restrictions. For instance, the state does not allow names to include the following:
- Words or phrases indicating or implying that your business is involved in illegal or unlawful purposes
- Words or suffixes such as “LLC,” “L.L.C.,” “Corporation,” “Corp.,” “LLP,” “L.L.P.,” “Inc.,” unless it is your business’s actual structure
There may also be restrictions placed depending on the nature of your business. Check with the South Dakota Secretary’s office for more details.
How To Get A DBA In South Dakota
It’s easy to get a DBA in South Dakota—the process is straightforward and not confusing at all. Here’s what you need to do.
Search for your preferred business name
While South Dakota doesn’t require all businesses to have DBAs, filing for one lets other businesses know you are using that particular name. Before you file a DBA with the Secretary of State, visit their website first to check if your preferred name is available.
South Dakota allows several different businesses to use the same DBAs. Still, you should still strive to create a unique name that will best represent your business’s brand and identity. Prepare a few business names in case the one you want to use is not eligible.
File your DBA with the South Dakota Secretary of State
Next, after verifying your DBA’s availability, you then need to file it online. Visit the South Dakota Secretary of State’s website to register your new assumed business name.
The form will require you to provide the following information:
- Your proposed assumed business name
- The names and addresses of the owners of the DBA
- Your Secretary of State Business ID if the owner of the DBA is an existing business entity
- Your Credit/Debit Card information. You will need this when you pay the filing fee.
Once registered, your DBA will last for five years. You must renew your DBA after that if you wish to continue doing business using that name.
How Much Does A DBA Cost In South Dakota?
South Dakota DBAs are very affordable at $10—way cheaper compared to other states like West Virginia and Wyoming. And although you need to renew it every five years, renewals only cost $10 each time.
The South Dakota Secretary of State’s office only accepts filing fees paid for using a credit card or a debit card. American Express, Discover, Mastercard, and Visa are accepted.
Frequently Asked Questions About A DBA
Here are the most commonly asked questions about forming a DBA:
The South Dakota Secretary of State’s office completes the processing of new DBAs in 1-2 business days. Because all applications are made online, there are no delays in the transmission or submission of necessary information used to register new DBAs. Those who want to get their DBAs processed within the same day they applied for it can pay an additional $50 for expedited services.
No, the South Dakota Secretary of State doesn’t allow DBA applications by mail or in person. All applications for new DBAs, as well as amendments and cancellations, should be done online via the South Dakota Secretary of State’s website.
Yes. You can have more than one DBA in South Dakota as long as you go through the process of applying for them properly. Also, you need to pay the filing fees to register each DBA and their renewal fees every five years.
No. Unlike LLCs and corporations, DBAs are mere aliases that do not provide any personal asset protection from lawsuits. This means that if your sole proprietorship or general partnership gets sued for reasons like negligence or breaches of contract and losses, you can be forced to pay penalties using your personal assets or anything with your name on it. You must get insured to protect your personal assets from being used as payment for court losses.
Yes, you can make changes or amendments to your South Dakota DBA as long as the assumed business name is active or not yet canceled or retired. These are limited to changes in the business’s address, the owners of the DBA, and their respective addresses as well. The assumed business name cannot be changed. You will need to visit the South Dakota Secretary of State DBA – Business Name Amendment page to make the allowed changes.
Yes. You can cancel your South Dakota DBA at any time as long as it is active. To do this, visit the South Dakota Secretary of State DBA – Business Name Cancellation page and cancel your DBA. You won’t need to pay anything to cancel your assumed business name.
DBAs and trademarks are very different. DBAs are fictitious names or aliases businesses can use in place of their actual name. They give you an added layer of privacy to hide your personal identity, but they cannot protect your personal assets from lawsuits.
On the other hand, trademarks are intellectual property registrations used to protect your brand from illegal reproduction, plagiarism, and intellectual property theft on a local and national level. They are not separate entities or aliases.