If you’re doing business in Texas, then you need to register your business name with the Texas state government. That makes sure you’re able to use that particular name exclusively. No one (except you) can use that business name for their own business transactions.
You may not even realize how much you’ll be using your business name. It’ll be in all your office forms, corporate stationery, and business cards. Every marketing and advertising material you release will feature this business name. It’ll be in all your official business formation documents, in your loan documents, and in every business contract and agreement you sign.
The main problem with not registering your business name in Texas is that someone else may already be using it, or someone may use it in the future. After all, Texas is a large state with a huge population of 29 million people. Great minds think alike, and it’s not all that improbable that some other people will come up with your business name to use.
So, how do you do this? Registering your business name in Texas involves a few crucial steps:
#1. Decide Your Business Structure and Business Name
When you’re running a business (whether in Texas or anywhere else), you’ll have to decide the structure you want for your business. It can be a corporation, a limited liability company (or LLC), a partnership, or a sole proprietorship.
The best choice for you will depend on several factors. Do you need personal liability protection? Are you planning on attracting investors? Do you wish to maintain a more complicated business structure? The answers to these questions can help guide you as to what business structure best fits your needs.
Personal Business Names for Sole Proprietorships and Partnerships
Some go with a sole proprietorship because there’s no need to register with the state. This is often the business structure used by freelance operators, along with some business owners and franchisees.
If you wish to run a sole proprietorship, then it will operate with your name by default. The legal name of your business and your personal name will be the same.
With partnerships, the name of the business will have to include all the surnames of the partners. You may have noticed that law firms (which often run as partnerships) are generally named this way, like Dewey, Cheatem, and Howe.
But you have the option of using a different name, not unlike how rappers have their hip-hop names for their musical brands. If you’re running a catering business, then instead of using your personal name, you can call your service something else (like “The Meticulous Catering Service for Foodies”). This is called using a DBA, for “doing business as”.
#2. Follow the Texas Naming Rules for Corporations
If you’re running an LLC or a corporation, then there are rules to follow. The most basic rule is that if you’re running an LLC, then the name has to include the phrase limited liability company. As in XYZ Limited Liability Company. But you can also instead use various abbreviations for the phrase, like Limited, Ltd., LLC, or L.L.C.
For a corporation, you have to use one of these terms: incorporated, corporation, or company. Thus, you have the XYZ Corporation.
Instead of XYZ, though, you can use any name or phrase you want using letters and numbers along with other common symbols like “&” and “!”. The same goes if you’re using a brand name for your sole proprietorship or partnership.
There are some restrictions, however.
You can’t just use words like University, Attorney, or Bank. You’d have to get approval from the appropriate overseeing body or board first. To use the word “Bank” in your company name, you’d have to get approval from the Banking Commissioner. You can’t use the word “University” or “College” without the ok from the Texas Higher Education Coordinating Board.
Your business name cannot give the impression of any non-existing government association, like using the business name Texas Catering Commission.
The business name can’t give the impression that you offer some sort of illegal service or product, like “Texas Accounting and Money Laundering”.
You also can’t use any name that implies that your business is meant to help war veterans (or their families), or that the business was created by war vets. The following words and terms are just not allowed: “world war”, “war”, “disabled”, “foreign”, “legion”, “veteran”, and even “Spanish”.
You also can’t use the words “lottery” and “lotto” in your business name.
You can always get yourself a registered agent service that can help you with your business name search. Registered agent services are anyway (though theoretically, you can do it yourself) quite affordable now. These services know all the rules by heart.
You can also go online and check out various free name generators for LLCs and corporations. Their suggestions can help you come out with your own business name.
#3. Check the Business Name Availability
You may have come up with a great, catchy business name for your corporation, but then again, it’s entirely possible that somebody else is already using that same business name in Texas. The business name rules online also define whether similar business names are allowed or not.
But you have to check first, to see whether the business name you’ve chosen is already in use or not in Texas. You can do this using the name search tool hosted on the website of the Texas Comptroller of Public Accounts.
Or, your registered agent service can do this search for you, including searching for similar business names. That way, you don’t end up with a business name that’s too similar to another business name. That can just lead to confusion, even if the name is theoretically allowed.
Finally, you may as well check to see if your business name is also available as a web domain. You need to have a website for your business—most clients and customers may regard your corporation as not quite legit if you don’t have one. At the very least, you’ll want to acquire the URL to make sure other business entities can’t use it for their own ends.
With your web domain and website, you should also have your own professional email account. While your Gmail account may do well enough for your private use, you need an account that ends with “@yourcompanyname.com”. Again, it reassures people that you’re running a legit business.
#3.Register Your Business Name
Now that you’ve decided on your business structure and you’ve checked that your chosen business name is actually available, the next logical step is registering your business with the state. You can do this on your own, by filing the necessary documents with the Texas Secretary of State. You’ll need to file your Articles of Organization if you’re forming an LLC, or your Certificate of Incorporation if you’re forming a corporation.
Your best bet is to go with an online business incorporation service, and the best ones offer registered agent services as well. They will file the documents for you for a very modest fee. That way, you know that all the details are handled properly and you can focus on actually setting up your business.
Tips on Picking Your Business Name
The right name can really help to get your business going, while the wrong business name can lead to customer dissatisfaction and even legal troubles. With the right business name, you can then proceed with your marketing and advertising more effectively.
So, how do you pick the right business name? Here are some tips that can help:
Stick to easy-to-spell names. That way, when people hear about your brand, they’re more able to do research and find your brand online. In the same vein, go with names that are easy to pronounce. You don’t want to keep correcting people on how to pronounce your business name properly. You then may have to end up with a mispronounced business name.
Don’t go with a that’s too narrow or limiting. That’s a problem that even Google encountered when they expanded their business beyond their search engine. They eventually formed Alphabet Inc. to become their mother company. That’s also the problem that Amazon avoided.
Use Google to see if your business name is already in use. While the name may not yet be registered in Texas, it’s still something to avoid so you won’t have any online confusion.
Try to go with meaningful names. The name itself can have a nice history, or it can clearly imply your business goals.
Go with catchy names as well. It should look good on paper, and sound nice, too. It should be something that catches your customers’ attention, instead of a boring business name that people forget quickly. At the same time, don’t be too weird—it can make customers think that you’re unprofessional.
Be happy with your business name. Don’t settle. You’ll have to live with that name, and customers can sense when you yourself aren’t all too sold with the business name you’ve chosen. You have to be able to say your business name with pride.
Changing Your Business Name
It’s very possible that you may decide to change your business name in the future. It may be because you’re transferring to another location in Texas, or maybe you’re changing or expanding your products and services. You may even go for a more politically neutral name, so you don’t end up like the Washington Redskins football team.
You can do this by filing for a DBA, or an assumed name. This is an extremely expedient course because you avoid the tedious task of changing your legal name. You won’t have to file an amendment to the legal name of your current business.
With the DBA, you just have to file an “Assumed Name Registration” with the right county clerk’s office. But if you really want to change your legal business name, you can just file the Certificate of Amendment.
How much will it cost to register my business name?
Incorporating your business in Texas, whether it’s an LLC or a corporation, will cost you $300 in-state fees. The fee will cover the business name registration.
Is it better to use an online incorporation service?
Yes. It is a better choice for most business owners because you have professionals covering each step of the incorporation process—including registering your business name. You can get services such as registered agent services, document forms and templates you can use, and checking on business name availability. These services can even help you set up your website, or provide assistance in various matters that new startups may require.
What the online incorporation service really does is free you from the tedious job of minding the details when you’re starting your business. That way, you’re able to focus your efforts more on actually setting up your business—and then getting it running!
Do I need a business license?
That depends on the kind of business you’re running. You can check out the TDLR website (Texas Department of Licensing and Regulation) for the various types of businesses they license. Texas does not offer a general statewide business license.
Can a trademark help?
Yes, a trademark can help. It can be costly, though. You may have to use an attorney, though some online incorporation services may also offer this optional service.
But you do get nationwide protection for your brand name. That helps a lot, especially when your online sales go nationwide. It may not be necessary for a local catering service or plumbing business in some city in Texas, but for those in the selling business, it can really help.