Having a Small Business in California


0

I applied for a sole proprietorship business in San Francisco. I had to spend money registering for the business($25 for County Clerk's Office) and the fictitious business name($44 County Clerk's Office). Then, the County Clerk required me to publish my fictitious business name on a newspaper($37-$90 for the newspaper) and turn in proof of publication ($7 filing fee for Country Clerk's office) or else my my application will be revoked. Does it make sense and is it legal to require a business to publish my information, including business address, on newspapers in order for me to be considered fully registered as a company? It sounds really wrong to be paying for something that doesn't directly help me. Please advise if there's anyway out of this or if you think this has been a law that everyone has to put up with.

Solo Entrepreneur Legal San Francisco

asked Jan 12 '11 at 07:56
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A.N.N.
1 point

2 Answers


2

Most entrepreneurs that start a solo practice do not need to do anything to start their business as a sole proprietorship doesn't require any filing with the Secretary of State. Therefore, you will find many sole proprietorships such as Barbers and other individuals who have been operating for years without registering anything.

However, if you do want some recognition, you can register a "Doing Business As" (DBA) also known as a "fictitious business name" with the county in which you are doing business. This requires more time and, as you found out, money. This is only required if you are afraid someone else will take your name and/or the public will be confused with your name as compared to someone else's name. Once you decide to register the DBA, you must follow all the formalities you mention above.

Lastly, when you are ready to register a real business, you should consider forming a corporation or LLC, which can limit your liability in case someone sues you. However, this requires an annual $800 Franchise Tax fee, so you should know that you need to be able to pay this after you form the corporation or LLC.

Note: This is not legal advice nor does this post create an attorney-client privilege.

answered Jan 12 '11 at 15:40
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Alex Naegele Lawyer
653 points

2

Many states have publication requirements. If it makes you feel any better, New York charges several hundreds to even thousands of dollars to meet publication requirements, depending on the county where you register. As to your question of whether it's legal -- yes, a state can require you publish information about your company. The benefit of publication for you is that you will be getting your name out to the public.

If you want to avoid this process, don't formally register with the county. As Alex mentioned above, many sole proprietors don't formally file anything. Formal registration not required by law. However, one of the points of filing and getting a DBA is so that you don't have to use your personal name on everything related to your business. If you opt to have a DBA, you'll have to go through with all requirements.

** This does not constitute legal advice.

answered Jan 12 '11 at 16:38
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Nhu Vu
201 points

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Solo Entrepreneur Legal San Francisco