Key Takeaways For Startups

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Key Takeaways

  • Startups change their names for a multitude of reasons, some strategic (or tactical) while others more practical. Irrespective of your motives, altering the name of your startup can have both beneficial and negative implications.
  • When you’re just starting out, you should take your time coming up with a unique business name that encapsulates what you have to offer. However, if you want to change the name of your existing startup, the process can be a little more difficult.
  • It’s difficult to gauge the amount of time and work required to successfully rebrand your startup. For example, you’ll typically have to inform the IRS and your local authority that you’re now doing business under a new business name.
  • Changing the name of your startup is a decision that should be considered with some caution.
  • If you have a well-established startup, changing the name would create confusion if not managed correctly. On the other hand, if your startup is still in its early stages, renaming it so soon may cause it to (at least, temporarily) fade away into obscurity by compromising on the little brand value that it might have generated.

What is the significance of a business name? 

Finding a suitable name for a product, or even for a startup that produces the product, can prove difficult. Within the hyper-competitive startup industry, choosing a unique name can make a huge difference. A great name is also fairly informative: in other words, would the name reveal any hints on what the startup does or what it offers?

How to Change a Business Name with the IRS?

When filing taxes with the Internal Revenue Service (IRS), you can change your name by updating the change on your tax filings or by specific written communications with the IRS.

The manner in which you give notice is determined by the kind of your startup:

#1: Sole proprietorship

Inform the IRS of your name change by sending a letter signed by the founder/business owner or a designated agent to the same location where you submit your tax filings.

#2: Limited Liability Company (LLC) 

If you are a one-member LLC, you must write a letter alerting the IRS of the change, together with your amendment certificate, to the same location where you submit your tax records.

If you’re a participant in a multi-member LLC, you must notify the IRS on your most recent tax return, the U.S. Return of Partnership Income (Form 1065).

#3: Partnership

You should send in your notice on Form 1065, your present year’s tax filing.

#4: LLC or Corporation taxed as the latter

You must provide a notice on your present year’s tax filing, U.S. Corporation Income Tax Return (Form 1120).

If you’ve recently registered the taxes for your company, rather than wait until you file afresh, you must write a letter to the very same location where you filed your tax statements to alert them of the change of business name. The letter must be signed by one of the startup’s members, partners, or executives.

How to Change Business Name on EIN?

Over time, as your startup expands, you may sometimes feel that it’s name does not really fit anymore into what you do.

There are numerous factors to take into account when deciding on a new name. If you inform the IRS about the change, you may be able to keep the same EIN (or employer identification number) that you’ve been utilizing. Certain circumstances, however, will necessitate a new EIN.

A name change request for a startup can be submitted by either the founder or another authorised individual. Based on the startup type, the specific action necessary may differ.

Submit your Business Name Change requests to the IRS, if the EIN was just issued and proper filing obligations are yet to be established. In some cases, a name change may involve the acquisition of a fresh Employer Identification Number (EIN) or the filing of a final return.

How to Change Business Name on Google?

If you’re the founder or administrator of a startup with one or more validated listings, you could modify your information straight from your Google Maps Business Profile.

There are a multitude of reasons why you might just need to update your Google My Business name. One possible reason to do that may be that after you’ve acquired another company, your own name (or brand) might need to undergo some changes. In another scenario, you may have used a provisional name when you originally claimed the Google Maps profile. Whatever the reason, you’ll want the accurate name and updated pictures to keep your brand identity consistent, as this could be the first location a potential buyer (or customer) goes to when searching for you online.

Steps to Change your Business Name on Google Maps:

  • Open Google Maps on your mobile or computer.
  • Input your business name into the search box or tap Menu and go to Your Business to access your Business Profile.
  • Tap Edit info on the toolbar and change your business name.
  • When you’re finished, tap Submit in the top-right corner.
  • Your changes are immediately visible on your Business Profile.

Steps to Changing your My Business account name:

  • Sign into your Google profile. It’s possible that this is connected to your Gmail account.
  • Click on the icon with the nine dots creating a square in the top right corner. All your Google apps are stored in this icon. (To use the My Business app, you may need to click on “see more”.)
  • When My Business opens, you’ll see your startup’s name. Next to the startup name, click on the blue edit function.
  • You should now see a blue box. Beside your business name, click on the pencil.
  • Enter a new name and click on “Apply”. The modifications may take a few days to reflect.

How to Change Business Name on Tax ID?

While this guide will give you a good idea of what’s involved, it is not a substitute for legal advice. Updating the business name on tax ID may have legal ramifications, so consult with a qualified business lawyer before proceeding.

#1: Sole Proprietorship or Partnership

If your startup is a sole proprietorship or a partnership, you can alter your Doing Business As (DBA) status by following these steps:

  • Cancelling the current DBA and requesting a fresh one. This entails approaching the government agency in charge of DBA approval and registration. Alternatively, you could hire an internet-based legal business document-filing service to take care of the specifics for you.
  • Getting in touch with your bank to see if the current commercial banking account name can be switched to the new DBA, or whether you’ll need to set up a new bank account for the new DBA.
  • Coordinating with county, city, and municipal public officials to verify if any business licences or permits for the new DBA need to be amended or acquired.
  • Checking with the IRS to see if obtaining a new DBA necessitates obtaining a new Employer Identification Number (EIN) in your case.
  • Notifying the Internal Revenue Service of the new DBA.

#2: LLC or Corporation

A startup that is established as an LLC or a corporation can change its name in either one of two ways.

The first way entails completely discarding the existing business name, while the second involves keeping the original name but developing a new one for marketing reasons (such as for a new line of products).

1. Change the business name by filing Articles of Amendment with the state.

An LLC/corporation can apply to alter its name by filing a paper called “Articles of Amendment.” If your application is approved, your startup could start to function under its new name.

Note: startups with international qualified employees in other states (i.e., those with multiple registrations) must file Articles of Amendment in each of those states.

2. File a DBA for the new name and maintain the current name as the listed business name.

Sometimes, it may make better sense for a startup to retain its formal name and develop a new name for promotional purposes (e.g., if the startup has a trademark for the name or has created a valuable consumer following for the brand).

In such cases, you can preserve your startup’s official name while submitting a DBA for the new name with the state and county department (whichever has authority over DBAs).

How to Change the Name of Your Business?

1. Do some research on the new name. Contact the United States Patent and Trademark Office first. To see if the new name has previously been claimed by somebody else, utilise the USPTO’s trademark search function. If not, use any authorized registrar to see if the domain name is obtainable. If you’re a for-profit startup, a .com address is generally perfect, but if you’re a non-profit, a.org address is more suitable. Lastly, check the website of the secretary of state to see if the new name has already been listed in your state.

2. Alert your secretary of state. A form for altering your business name can be found at the state’s offices. These kinds are known by various names in different states. To find the link to your state’s office, go to USA.gov. There will almost certainly be a fee associated with the name change.

3. Modify your licences and permits. Almost all companies are required to obtain licences and permissions from different government levels and you would likely have your own set of these. To update the name on those forms, approach each of the agencies involved with those permits. Again, there will almost certainly be fees associated with this.

4. Notify the Internal Revenue Service. Based on your startup type, the IRS would have varying requirements when you’re changing the name of your business. To learn more about your unique requirements, go to the IRS website. In some cases, it may be as simple as documenting the name change on your next tax return.

5. Obtain a new EIN. A fresh employer identification number will be required for certain startups if they’re changing their name. To see if you have to reapply for an EIN, consult IRS Publication 1635.

6. Keep your startup’s paperwork up to date. Make the necessary changes to your branding to reflect your new name and logo. This includes all startup forms, signage, and your websites. Request that your website be redirected to your new domain by contacting your site administrator.

7. Inform your clients about the change. A name change may occur as a result of the startup being acquired, new leadership taking over, or an unfortunate turn of circumstances necessitating a new beginning. In any case, inform customers as quickly as possible that you are still fully operational. Transparency is the best policy – discuss precisely (and perhaps even joyfully!) why your startup’s name has changed. This will help you maintain customers’ trust and help you on your way as you begin to establish your new brand.

We can help!

At AbstractOps, we help early-stage founders streamline and automate regulatory and legal ops, HR, and finance so you can focus on what matters most—your business.

If you’re looking for help with changing your business name, we have got your back. Sign up to get started.

Note: Our content is for general information purposes only. AbstractOps does not provide legal, accounting, or certified expert advice. Consult a lawyer, CPA, or other professional for such services.

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#This post is a guest post and the content has not been edited by the Pune365 desk. This may contain links to external sites outside this portal.

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