Using an unregistered trade name on your sales, billing, and other contract documents can affect your ability to collect in New York. If your company uses a trade name, we recommend registering that name with the New York Department of State. Failing to do so may cost you the receivable.
Below, we cover what a trade name is and its importance.
What is a trade name?
A trade name is a nickname of sorts for your company. The nickname may be a shorter version of your company name, a combination of the first letters of the names in your company name, or something totally unrelated. A trade name is the name the company uses on its website, on contracts, purchase orders, invoices, statements, bids, and more.
Full company names are typically formal, and so companies often opt for shorter, catchier ones. Here’s an example. Company “ABC Flavors, Inc.” may use any of the following trade names: ABC, ABCF, or Elementary Flavors. They use the trade name Elementary Flavors on their invoices, contracts, website, or other documents rather than their complete corporate name.
Registering with the New York Department of State
New York corporations (domestic corporations) are registered with the New York Department of State. Out-of-state corporations (foreign corporations) that do business in New York State should also register with the Department of State. You can check your company’s registration status through the Department of State Corporation and Business Entity Search Database.
In addition to the official corporate name, you can also register the trade name with the Department of State. The trade name would be registered as an assumed name. In our example, “Elementary Flavors” would be an assumed name registered with the Department of State.
New York State General Business Law § 130(9) requires that you register all trade names and assumed names with the State. Failing to register your trade name may cause you to forfeit your right to payment.
A creditor needs to have standing, the ability to sue to maintain a court action. That is true regardless of the type of case you want to bring. Debt collection cases are breach of contract cases. Based on the law, using an unregistered trade name means you will not have standing to sue.
N.Y. General Business Law Section 130, Filing of certificates by persons conducting business under assumed name or as partners (2026) states:
Any person or persons carrying on, conducting or transacting business as aforesaid who fails to comply with the provisions of this section shall be prohibited from maintaining any action or proceeding in any court in this state on any contract, account or transaction made in a name other than its real name until the certificate required by this section has been executed and filed in accordance with the provisions set forth herein.
Debt Collection for Companies Using Unregistered Trade Names
You may have options if you are using an unregistered trade name. If you have pending litigation to recover debt, and the debtor did not raise this as a defense in their answer, the defense that you are not registered is waived.
But, if the non-paying customer raised the defense in their answer, the court may allow you to register the trade name with the state now. That is assuming you are not using the trade name with an “ intent to deceive.”
Wondering about your ability to enforce your right to get paid or have a claim you need assistance with? Contact Frank, Frank, Goldstein & Nager. We have the experience that pays.
