Legal Use of DBA for Independent Contractors

By Stephanie Kurose, J.D.

Legal Use of DBA for Independent Contractors

By Stephanie Kurose, J.D.

An independent contractor is a self-employed individual who can be hired to provide services to another entity. Many independent contractors are sole proprietors, but they can also be the sole owner of a limited liability company (LLC), corporation, or other type of business entity. An independent contractor may wish to use a "doing business as" name, or DBA, when conducting business, as it acts as an alternative to their legal name.

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Independent Contractors

The Internal Revenue Service (IRS) considers independent contractors as those who work in an independent trade, business, or profession and offer their services out to the general public. To be considered an independent contractor, the general rule is that the entity who is paying for the services can only control the end result of the work and not how the work is done or what specifically is done. If the payer is able to control all aspects of the work, the payee is considered an employee rather than an independent contractor.

The legal name of an independent contractor is also the person's legal name. Absent a registered fictitious name like a DBA, the independent contractor is required to use their personal name when conducting business transactions or for advertising or marketing purposes.

Using a DBA

DBAs allow business entities to conduct business under a name other than their legal name. DBAs must be registered with the state agency that has jurisdiction over businesses—typically the Secretary of State. There are a variety of reasons a business entity may wish to use a DBA as opposed to their legal name, such as branding, personal privacy, or if it wants to expand into different states.

For an independent contractor, a DBA is an attractive option since it provides an alternative to using their personal name for daily business operations. Not only does it allow for personal privacy, but also appears more professional to have an actual business name and can help clarify the services being offered.

Because state law regulates DBA use, if an independent contractor uses a DBA and operates in more than one state, they must register the DBA in each state where they conduct business. The requirements to register DBAs vary by state. For instance, some states require independent contractors to register at the state level, while others require registration at the local or county level. Thus, it is important to know each state's rules because the independent contractor is required to register their DBA in each jurisdiction where they plan on conducting business.

Registering a DBA

Independent contractors are required to file a DBA registration form and provide their legal name, the desired DBA name, and general information about their business and pay the applicable filing fee. The majority of jurisdictions also require the DBA to be published in a newspaper of general circulation to give the public notice of their intent to operate as a DBA.

Whether an independent contractor is a sole proprietor or the owner of an LLC, legal use of a DBA depends on its legal registration and public notice in the jurisdiction where it will be used.

A DBA protects personal privacy, allowing independent contractors to work under a legal business name. It also helps clarify services offered by the independent contractor, making them appear more professional.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.