When you launched your limited liability company (LLC), you gave that company a name. Now that name doesn’t fit anymore. This simple guide breaks down what the process of changing an LLC’s name looks like and whether it’s worth the time, hassle, and costs to do so.
Can I Change the Name of My LLC?
Your first question may be whether it’s even possible to change the legal name under which you registered your limited liability company. The good news is that, yes, an LLC’s name can be changed.
Changing the legal name of your LLC is a more complex process than simply adding a separate “doing business as” name that your company can use in addition to your official business name. For this reason, you should think carefully about what outcome you hope to get out of the name-change process.
Reasons to Change Your LLC’s Name
Why might a business owner consider an LLC name change? Ditching the name of an established business for a new name isn’t a decision you should make on a whim. In most cases, the small-business owner decides to change their LLC’s name for one of the following reasons:
- Correcting a typo or error in your company name
- Keeping your LLC’s legacy name true to the company’s current ownership
- Representing changes in the company’s identity
You might also change your company’s name if you encounter an issue with businesses that have a name that’s too similar to your LLC. This LLC name change may be voluntary, to avoid confusing customers or being associated with an entirely separate company. If the name similarities result from a trademark issue that becomes a legal matter, a court may demand that you change your LLC’s name.
Changing Your LLC’s Name to Correct an Error
Maybe you really did choose the perfect name the first time around, but it wasn’t entered perfectly on your articles of organization, business registration form, or other legal documents. You need to change the LLC name to get it right.
If you made a spelling error or a typo—or a government official made the mistake but you failed to notice it in time—you may have the option to file a Statement of Correction or Certificate of Correction. If that option doesn’t apply to you, or if you’re changing the LLC name more substantially, a full-on name change may be the only way to get it right.
LLC Name Changes to Accompany Changes in Ownership
Over time, the people and places tied to a business may change. If your company’s old name incorporates any of these elements, it may make sense to alter that name to reflect new realities.
In a multimember LLC, in particular, changes in company ownership may prompt you to remove old owners from the company’s name. This may happen if, for example, one of the original owners retires, passes away, or is bought out. You might also add a new owner to the name if another member becomes part of your LLC.
A New Business Name That Highlights Your Updated Business Identity
When you first established your LLC, you had a vision of what your limited liability company would look like. If your philosophy or your offering of products or services has changed drastically, the current iteration of your LLC might not match that vision or the original LLC name. A new LLC name might better encompass all that your company does.
The Name Change Process for a Limited Liability Company
There’s no way to just trade one LLC name for another. Instead, if you decide that a name change is right for your business, you have to undertake the process of amending your LLC filing with the secretary of state.
Don’t let the logistics overwhelm you. If your preference is to change your LLC’s legal name, you just need to follow this step-by-step process to make everything official.
1. Come Up With Your New LLC Name
You can’t change your LLC name unless you have a new name picked out. Since going through an LLC name change can be a hassle, not to mention an expense, you shouldn’t rush into selecting a new business name. Take your time and really think over what you want your new name to convey about your company.
2. Check the Availability of Your New Name
Most states won’t allow two businesses to have the same name. Before you take any other action to change your LLC name, you need to run a search in your state’s database to make sure no other company is using the name you want.
Most states charge no fees to run business name searches, but it’s important to check with your state’s regulations to find out where and how to access the database. In Texas, for example, you can run a search through the Secretary of State’s online business service for $1 per search, or you can run a taxable entity search through the Texas Comptroller of Public Accounts for free.
If your new LLC name is available but you’re not ready to move forward with the name change process just yet, you can reserve the business name you want for a fee. You also need to reserve a business name you plan to use in the state of Alabama, even if you’re ready to complete the process right away.
Reserving a business name doesn’t make it yours permanently, so if you want to use this name, you need to start taking the next steps quickly. Otherwise, your name reservation will expire, and the name will be up for grabs again.
3. Consult Your Operating Agreement and Approve a Name Change Resolution
Now that you’ve identified the name you want, your company needs to officially decide to change its name. The operating agreement all LLC members signed when you launched the company should outline this process. Depending on the terms of your operating agreement, you may have to hold a vote of LLC members on whether or not to change the name.
If everyone in your company is on the same page, approving the name change resolution may be as simple as signing a written document to this effect. There may be a cost associated with this action if you have a lawyer or a legal technology company draft this resolution for you.
4. File a Certificate of Amendment With the State
Here’s the part where your name change becomes legal and official: When you file an amendment to your LLC forms. Changing the name of your LLC requires you to update the paperwork used for establishing an LLC, usually called articles of organization or certificate of organization.
Be prepared to pay a filing fee for a certificate of amendment. The filing fee could range from as little as $15 in Montana to $200 in Delaware and $220 in Washington, D.C. You may need to file your articles of organization within 30 days of passing your name-change resolution.
5. Don’t Forget to Amend Your Operating Agreement
The official process of changing the legal name of your LLC is over after filing your certificate of amendment, but the practical process of making this name change has just begun. Make sure that you update the business name in the operating agreement that you consulted when planning the name change.
6. Update Your Name on Your Licenses, Bank Accounts, and More
Now you’re ready to move on to updating your business name on everything else. If your business requires special licenses, make sure that you update those licensing agencies with your new LLC name to keep your information current. You should also update your name on tax entities at the state and local level as well as the federal level (the IRS).
Your business bank accounts, too, must be changed to reflect your company’s updated name. You should also make sure your registered agent is aware of the name change.
Changing your name on these official listings and accounts sometimes requires you to submit a copy of your certificate of amendment.
The other areas in which you need to change your LLC name are more varied and less formal. To put it simply, if you change the name of your LLC, you also have to change everything that includes that name, such as:
- Company letterhead
- Marketing materials and branded merchandise
- Website domain name and internet presence
As you might be able to guess, the cost of this changeover may vary depending on how much branded merchandise your company has. If your company has its own screen printing machine, you can create your own branded merchandise in house at less expense.
The Pros and Cons of Changing Your LLC Name
The biggest benefit of changing the name of your LLC is knowing that your company’s name fits it perfectly. Given the importance of first impressions and of your company’s ability to stick in customers’ minds, having the right name is priceless.
The disadvantages of changing your company’s name include:
- The hassle
- The time it takes to complete the name-change process
- The costs, which may include filing fees, legal services, professional business formation services, and branding and marketing efforts
- Any confusion caused by the name swap
Is a Name Change the Best Option for Your Business?
Given these disadvantages, many companies hesitate to change their legal name completely. In some circumstances, a better option might be to:
- Add a DBA to your LLC: Adding a DBA (“doing business as”) allows you to do business under another name without changing your LLC’s legal name.
- Set up a series LLC: In a series LLC, you can set up as many distinct child LLCs, all under the umbrella of one parent LLC, as you need. Instead of revising your company’s name to include every component of your business, you can segment out LLCs that cover different lines of your work.
Now that you know what’s required to change your LLC name, you can make an educated choice about whether and when to make this change. If switching your company name will make you happier or make your business more successful, then it’s likely worth the inconvenience of having to fill out a few forms. If not, you can consider whether options like a DBA can achieve the same outcome with less hassle.