Registering your freelance business as a Limited Liability Company (LLC) comes with a host of perks. But before you can reap the sweet rewards of operating as an LLC, you need to complete your registration. The first step involves coming up with a unique name.
What’s in a name, at least when it comes to your LLC? Well, it carries more weight than you think. Sure, your business name should be memorable so your customers won’t easily forget you, but this is also the legal name that will appear on all of your business’s formal documents.
Also referred to as a “trade name,” you’ll use this name for everything from setting up your business’s bank account and signing contracts, to representing yourself in any legal cases you might find yourself in.
The good news is that you get to choose your LLC’s name, so get as creative as you want. The bad news is that your choice might be limited by some confusing legal rules and regulations. And, to make things even more complicated, every state has its own rules about how you can name your LLC.
Since you’re planning to register your LLC in California, having an understanding of the state’s naming requirements is key. You don’t want to spend a bunch of time coming up with the perfect name, only to have it rejected or find out that it violates an existing trademark. No one likes rejection…or lawsuits!
If you’re a freelancer in California, check out the information below to learn a bit about what it takes to name your business right.
California LLC Name Requirements
Your business’s name must end with the words “Limited Liability Company” or the abbreviations “LLC” or “L.L.C.” You can even opt to abbreviate the words “Limited” and “Company” as “Ltd.” and “Co.” Most people just stick with “LLC”.
Let’s say you want to call your business the ABC limited liability company. You can write it out as:
- ABC Limited Liability Company
- ABC Limited Liability Co.
- ABC Ltd. Liability Co.
- ABC L.L.C.
- ABC LLC
In California, your LLC’s name may not contain the words:
- Insurance company
- Any other words suggesting that it’s in the insurance business
Whatever name you choose shouldn’t be misleading to the public. For example, your LLC’s name shouldn’t imply a false government affiliation. This is why using words like the following isn’t allowed:
Your LLC’s Name Can’t Be Similar to Existing California LLCs
California law specifies that your LLC’s name needs to be unique in several ways, so you can’t just use any name you want and add “LLC” to the end of it.
Here’s what you should keep in mind as you brainstorm the perfect name for your business:
The name can’t be the same as, or even too similar to, the name of an existing LLC that’s on file with the California Secretary of State. When you file your LLC articles of organization with the Secretary of State, they’ll check to ensure that your proposed name isn’t already in use.
If the name is registered by someone else, your articles will be rejected and you’ll need to refile using a new name. There is an exception, though: If the other LLC agrees to let you use the name, you might be good to go. Unfortunately, it’s usually either impossible or too expensive to get this consent.
How can you be sure that your name won’t get rejected?
Before filing your articles, check if the name that you want to use is available in California.
- If you’re using an attorney: they can help you check for the name’s availability. Just keep in mind that attorney fees quickly add up, and those costs could burn when you’re first starting off.
- If you’re filing the paperwork yourself: it’s up to you to check the availability of the name you want. You can perform a search for the name in the California Secretary of State’s online business search database.
But you should be aware that this database only shows you the names of other LLCs that are registered with the California Secretary of State. This isn’t a good tool if you want to be sure that your name is so unique that it won’t even match the names of registered businesses in other states.
- You can let the Secretary of State’s office do it for you for free: fill out a Name Availability Inquiry Letter, and then send it by mail, with a self-addressed stamped envelope, to the Secretary of State.
You can submit up to three names with every inquiry letter.
The drawback? You have to wait for the responses to your letters. In this age of rapid digital responses, who’s got time for snail mail?
Want to reserve your name before someone else grabs it?
Let’s say you’ve come up with a fabulous name, and you can’t see your business running under any other name but that one. You’ve done your homework and confirmed that the name isn’t in use, so it’s up for grabs. But what if someone else comes up with the same brilliant name and snatches it up before you do?! Don’t worry. There’s a strategy you can use to be sure that the name will still be available by the time you file your articles.
All you have to do is reserve the name by filing a Name Reservation Request form. You’ll need to hand-deliver or mail this form to the California Secretary of State’s office and you’ll pay a $10 fee.
But it’ll all be worth it because they’ll hold your name for up to 60 days, and during that time, only you can file Articles of Organization using that name.
Businesses with Similar Names in Other States
What if another business is using a similar name to operate in another state? It still might not be a good idea to use it, even if you can register it in California.
You shouldn’t use a name similar to that of a well-known business.
We’re talking about names like Amazon, Tesla, or McDonald’s. Did you know that these companies will sue other businesses that use similar names? McDonald’s regularly sues companies that use the “Mc” prefix. Pretty extreme, but true.
So, to avoid problems, it’s best to steer clear of similar business names.
You shouldn’t use a name that’s similar to another company that sells goods and services that are like yours.
If the other business finds out, it might sue you for unfair competition.
To protect yourself, if you only plan on doing business locally, search for the names of local businesses within your niche. If you plan on doing business around the country, search for businesses on a national level.
How to search for business names that might be too similar to yours:
- Perform an online search for the business name that you’re hoping to use. See if anyone else, anywhere, is already using it or something similar. Also, look into what goods and services they provide.
- Check out SuperPages or the Thomas Register of Products and Services to search for trade and corporate names online. It’s free!
What About Trademarks?
Trademarks are different from business names. We know, it gets confusing. Hold tight, we’re about to explain.
When the California Secretary of State registers your LLC name, it just establishes that name as your LLC’s formal legal name. It doesn’t mean that you actually have the legal right to use that name, or any form of it, to sell your products and/or services.
There are federal and state trademark laws designed to protect the names that are used to market products and services. Companies often use a shorter version of their business name as a trademark.
Example: Apple Computer Corporation becomes Apple, which is the trademark for all of those computers and devices everyone loves.
What does this all mean for you, the freelancer who just wants to register their LLC and get started making money?
Well, if you choose a name that’s the same or similar to a registered trademark you might get sued for trademark infringement when you market your products or services. Yikes!
So, in addition to checking if your preferred business name is already registered by another company, you also need to check that you won’t be competing with a trademark. In the event that your LLC’s name is registered as a trademark by someone else, you’ll need to limit the use of that name to your bank account and legal documents. And that could leave you walking on eggshells.
But, here’s the thing: you don’t have to use your official legal business name to market your goods or services!
Here’s an example of what we mean:
If you registered your LLC as “AAA Web Design, LLC,” you can operate under a fictitious name, like “Gorgeous Websites for Cheap.”
Use that name on your website, business cards, promotional materials, advertising, etc. by filing a fictitious statement or assumed name certificate, which is also known as DBA (“doing business as”).
File this with the California county where your principal place of business is located (i.e. where your office is found, or where you own most of your income if you don’t have an office). Keep things simple by checking with your county for specific requirements for filing a fictitious business name statement. Or, use an online service like Legalzoom that will do the filing for you for a fee.
Remember: your fictitious name can’t be the same or similar to another fictitious name that’s already on file in the same county.
And it can’t be a name that might violate a trademark. So, before you go ahead and file the appropriate paperwork, you’ll need to do more searching—this time, through county records.
Bonus Tips for Naming Your LLC
Wow, this information is a lot to take in. Take a breath, and know that you can definitely get it all done and have the perfect LLC name in no time.
Before we send you on your way, we have a few other tips for you.
Check if your LLC’s name can be used as your domain name for your website.
Search through domain name registration websites like Register and Network Solutions, or browse the hosting service that you’re planning on using, such as WordPress. You might need to purchase a domain name that’s owned by someone else or tweak your domain name to find one that’s available.
This link has a list of resources that could help you generate a domain name if you’re having trouble.
Come up with a distinctive business name that stands out, especially if you plan to use a version of your name as a trademark or service mark.
Think about it: you know exactly what Exxon and Häagen-Dazs are because they’re such original names. Plus, the more distinctive a business name is, the more protection it receives as a trademark.
A name that’s not so distinctive, or even considered weak, might not get as much, if any, legal protection.
Choose a name that’s appealing, memorable, easy to use, easy to pronounce, and easy to spell.
Keeping your name short is also recommended.
Avoid the use of personal names (first names, surnames, nicknames, and initials) in your company name.
Also, avoid names that describe your geographic location, like “Texas Marketing Research, LLC”. And avoid names that describe the attributes of your products or services, like “Original Web Design, LLC”. Come on, you can do better than that!
Ready to Come Up with the Perfect Name for Your LLC?
When you’re ready to launch your business, start by getting creative and coming up with a list of potential LLC names that you’d be happy using.
Then, keep things simple by contacting us. Collective helps you perform all of the appropriate searches to find out if any potential names don’t make the cut. And we’ll even guide you through the process of registering your business. Before you know it, you’ll be one step closer to operating like a pro!
Stephen has dedicated his career as an attorney and author to writing useful, authoritative and recognized guides on taxes and business law for small businesses, entrepreneurs, independent contractors, and freelancers. He is the author of over 20 books and hundreds of articles and has been quoted in The New York Times, Wall Street Journal, Chicago Tribune, and many other publications. Among his books are Deduct It! Lower Your Small Business Taxes, Working with Independent Contractors, and Working for Yourself: Law and Taxes for Independent Contractors, Freelancers & Consultants.