Is Reserving a Company Name Necessary?

name tagWhen clients are ready to start their new business, timing is an important factor.  And while the excitement of forming the new Delaware company builds, clients might also have the perfect company name in mind.  Some clients are ready to get started right away, and proceed with forming a new Delaware company immediately. Other times, clients might have other important items to check off of their list before actually proceeding with the Delaware formation process.

One of the first tasks clients undertake is checking to see if their company name is available in Delaware.  For example, a client may have narrowed down a few company names but really prefers one specific name.  Clients can check to see if the company name is available through the Harvard Business Services, Inc. (HBS) website, here, or through the Delaware Division of Corporations directly once ready.  After receiving the good news that their preferred company name is available in Delaware, the decision on when to move forward is typically made.

But what if the company name has special meaning to the client and they’re concerned that someone else might form a Delaware company with this similar name before they’re ready?  In these cases, our clients can choose to reserve the company name in Delaware.  A company name can be reserved within the Delaware Division of Corporations records for 120 days and the fee is $75.  Or, HBS can assist with reserving the company name in Delaware.


A question to then ponder is do you really need to reserve the company name?  While this depends on specific factors, if clients are planning to form the Delaware company right away or within a few business days or maybe even within a week or so, paying the additional fees to reserve the company name might not be necessary.

Some new business owners come to us under the impression that if they reserve the company name and pay the fees, the amount paid will be deducted off the Delaware formation cost, which is not the case. Since a Delaware Name Reservation is not necessary to complete a Delaware formation, the $75 fee is entirely separate from Delaware’s formation costs.

If you’d prefer to form a company at a later date, consider how unique the name is. It’s possible, even over the course of a few weeks, for someone else to start a business with the name that you wanted. By reserving your company name and paying the additional fees, you’ll at least have peace of mind knowing that the company name will still be available when you’re ready to get started.

When reserving a company name in Delaware, another important factor to also consider is that if a name is reserved as a Corporation, such as ABC Construction, Inc., but then it’s decided that a Delaware LLC needs to be formed instead, then the Name Reservation that was submitted to Delaware would typically need to be transferred into the LLC’s name.  This can cause delays and therefore, we strongly advise you to make sure the proper entity type is firmly decided upon so that a reservation transfer is not required.

Ultimately, choosing whether or not to reserve your company name is up to you. If you have any questions about how to reserve a company name in Delaware or about the Delaware formation process, feel free to contact us at 1-302-645-7400 or 1-800-345-2677 ext. 6900 or via email at We can also be reached via skype at delawareinc.

*Disclaimer*: Harvard Business Services, Inc. is neither a law firm nor an accounting firm and, even in cases where the author is an attorney, or a tax professional, nothing in this article constitutes legal or tax advice. This article provides general commentary on, and analysis of, the subject addressed. We strongly advise that you consult an attorney or tax professional to receive legal or tax guidance tailored to your specific circumstances. Any action taken or not taken based on this article is at your own risk. If an article cites or provides a link to third-party sources or websites, Harvard Business Services, Inc. is not responsible for and makes no representations regarding such source’s content or accuracy. Opinions expressed in this article do not necessarily reflect those of Harvard Business Services, Inc.

More By Justin Damiani
Leave a Comment
* Required
* Required, will not be published