You’ve got a good handle on your business, but your LLC name’s feeling a little outdated. Here’s how to change it the easy way without the complicated legal jargon!
The need to change LLC name
For LLC owners, dozens of situations may arise where they have to change the name of their LLC. For example, to begin with, when a business owner wants to start an LLC, and instead of forming a new LLC, it is decided to buy an existing LLC to avoid the relatively complex process of creating a new LLC. However, it is implausible that you get to buy an LLC that has been operating under the same niche as yours, and you don’t feel like changing its name. It is where name change comes into question.
Another usual situation for LLC owners to change the name of their LLC is when they decide to pursue a new business under their LLC. For example, an LLC that was previously being used for owning property can be in the line to be used as a holding LLC. Such a situation may tempt the LLC owner to opt for a new name more in line with the latest business structure. Here is a list of some other situations where a name change becomes inevitable:
- Addressing a trademark issue
- Rebranding
- Supporting growth or changing your industry, strategy, or products
- Updating a legacy name
- Making a correction
While these are some of the usual situations where LLC name change is considered, these are not all, as there is a long list of reasons for LLC owners to change the name of LLC. This article will explore the entire process of changing the name of your LLC and other changes that would come with the change in the name of your LLC.
The easy way to change your LLC name
One of the easiest ways to operate under a new name for your LLC does not involve changing the name of your LLC at all. It is known as DBA or Doing Business As. There are so many situations where name change can be quickly sorted by merely applying for a DBA.
For example, you have an LLC registered under the name of Martin Enterprises LLC, but now, you want to operate an automobile agency, and you want a new name for it, let’s say, Martin Automobiles. For this, you won’t have to change the name of your LLC, as you can apply for a ‘Martin Automobiles’ DBA. In this case, your DBA will become a fictitious name for your automobile business, and you will not have to change the primary name of your LLC.
For DBA, however, it is essential to understand that the legal name of your LLC will not change, and it will stay as it was. If you are looking to change the legal name of your LLC for lawful purposes, DBA is not for you. Coming back to the question of how to change the name of your LLC, here are the steps that list the entire process of changing the name of your LLC:
- Refer to the operating agreement of your LLC
Referring to your operating agreement is the first step towards changing the name of your LLC. The operating agreement of the LLC may outline specific procedures that you’d have to follow to change the name of your LLC.
- Create a member resolution
Since it will be a monumental change in the context of your LLC, it is imperative that you create a member resolution, and every member of the LLC signs it. This document will give your resolution a legal status for the future. Once these two basic steps are done, you have officially initiated the process of changing the name of your LLC. The steps that will follow are:
Choosing a new name
Once you have created a member resolution to change the name of your LLC and it mutually accepted, the next step is choosing a new expression of your LLC. It is essential to check the record with the LLC directory of state to ensure that the name you are choosing doesn’t already exist. If you have selected a name already on the record with the secretary of state, it will not be processed.
Using the right keywords and other things to consider
When choosing the new name of your LLC, it is vital to select the right keyword for the name. For example, if your LLC is dealing with books and register it under Alex Holdings LLC’s name, it will not be the right choice. You have to make sure that the name of your LLC represents what your LLC is designed to do.
You have to consider other things while naming your LLC because your new name for LLC should be distinctive, original, and meaningful. If you want to explore your business on social media and the web, you should opt for a more social-media and web-friendly name. It will help you in your adventures on social media and the web. It is also essential to choose a memorable name so that whenever people hear the name, they instantly know what it is!
Filing paperwork with the state – amend your articles of organization
Once you have chosen the name for your LLC and have made sure that it fills in all the requirements, the next step is to file the paperwork with the state. Generally, it will require you to amend the articles of organization of your LLC to depict the name change.
Once you have paid all the filing fees and the state approves your amendment in articles of organization, your LLC will officially have a new name on the state record. Costs for filing amended articles of organization vary from state to state, but generally, they’d always be somewhere between $20 to $150.
However, there are more steps involved before you can officially start using the name for your LLC.
Update accounts and register the new name with IRS
After the state approves your amended name, the next thing you will require is to update your bank accounts and file to register the new name of IRS. IRS’ requirements for registering a new name varies from state to state and by the nature of your LLC. So, it is crucial to make sure that you need to change your LLC’s name on the IRS records by visiting their website.
Update your business cards, website, letterheads, email signatures etc.
Once the state and the IRS approved the new name of your LLC, you can start with updating the new name of your LLC on your website, letterheads, business cards, email signatures, and all other documents where you use the name of your LLC. It is important to make these changes instantly to avoid any confusion in your business setup.
Update any written legal documents
All the legal documents related to your LLC will need to have the new name of your LLC on them. It will start with the operating agreement of your LLC, and you will have to update the new name of your LLC on other legal documents like your employees’ contracts, your ongoing agreements, etc.
Notify customers, employees, and stakeholders
It is the last step, but not the one of least importance. Once you have completed every process listed above, the last thing that you would need to do is to notify your customers, employees, and stakeholders about the name change. You would also want to inform your bank and credit card company about the name change of your LLC to avoid any inconvenience.
So to summarize…
There are hundreds of reasons for you to change the name of your LLC. However, before you go ahead with the name change, evaluate all the key factors, and see if there is any other way out, DBA, for example, etc. If you have no option left, you should go ahead with changing the name of your LLC. Hiring professionals to change the name of your LLC is always recommended, considering the complex nature of the process of changing the name of your LLC.
Frequently Asked Questions
Here are some of the frequently asked questions I get and their answers regarding the name change of an LLC:
- How difficult is it to change a business name after applying for an LLC?
It is a fairly complex procedure, but you can take it on yourself and get it done. The process involves registering the new name of LLC with the state and the IRS and updating the name in few other legal documents. A professional’s help can get it done for you with ease.
- How do I notify the IRS of an LLC name change?
You can write to the IRS at the same address where you have filed your returns. It is important to make sure that the document that enlists the name change of an LLC is signed by the owner of the LLC or its official representative.
- Does my LLC name have to be the same as my business name?
While it would make so many things easier for you, it is not mandatory for you to have the name of your LLC similar to your business name or your website. There is no such legal constraint to keep the name of your business, your website, and your LLC as one.
- Should I name my LLC after myself?
The name of your LLC should be more directed towards the services or products that your business deals with. However, if you are an artist or a celebrity known to people, having your LLC registered under your name will be of great help to you.
- How long does it take to change the LLC name?
Your paperwork with the state regarding the name change will be approved in one to two business days. Once it is done, it would take a couple of days to get your new name registered with the IRS. So, overall, this process shouldn’t last for more than a week.
- Do I need a new EIN if I change the name of my company?
While generally structural change an LLC often requires you to file for a new EIN, a change in the name of your LLC doesn’t require you to register a new EIN. You can continue to operate with the same EIN after you have changed the name of your LLC.
