What is a Business License?
A business license authorizes a company to "do business" in a certain geographical jurisdiction. It is a certificate that authenticates your company is properly registered with the particular county or city in which your office(s) are located.
What Licenses Does My Business Need?When you apply for a business license, keep in mind that there are instances with certain types of businesses and certain locations that require additional paperwork for permits. We discuss both the types of licenses and permits below. If you'd like to research your license and permit requirements yourself, you can get started with Incfile's Business License Search Tool, which will tell you the basic requirements for your state and industry.
There are two categories of business licenses, namely federal and state. This is just the first step in operating legally in both your jurisdiction and in the country.
The federal government often requires a license to be obtained when you have a very specialized industry or one with a high level of liability. Some examples include serving alcohol, running a fishery, opening a gun shop, or transporting live animals across state lines.
The state government always requires a license to operate within your particular locale and rules can differ based on whether your LLC or corporation is inside city limits or not. For example, you'll need to research whether you can have particular types of home businesses, especially when living in the city or a multi-family dwelling.
How Do I Know What Permits My Business Needs?
If your operating a food business from home many states and local cities may also have additional licenses and permits needed. Remember the types of foods you can make from home and sell are VERY limited, so renting a commercial kitchen may be the best route if you want to sell food online.
Permits are an additional requirement for many businesses and are needed in the following circumstances.
- Your LLC or corporation plans to serve alcohol or food.
- You will need to build or add a structure to your company's building.
- Your business is going to construct a building or structure on new land.
- Your LLC plans to put up an exterior sign.
- You want to designate street parking for your business.
- Your industry is governed by a state association.
This is not an exhaustive list by any means, therefore, working with Incfile to identify every situation is a key factor in starting your business off right.
How Do I Apply For A Business License?
You'll need to get a license for a small fee to operate a business at the address of the location.
- Next, your company will need an Assumed Name under which to register, or you can incorporate your business and use your formal name.
- Then, if you operate from home or plan to remodel a space, for example, you'll need to obtain permits to do so. Other permits covering serving alcohol, displaying a sign on the building exterior and even parking for your business might also be a requirement. A great place to research your local zoning and operating laws is the nearest Small Business Development Center (SBDC).
- Finally, a business must register with the state tax office and submit appropriate taxes on the schedule indicated by your secretary of state.
Business License and Permit Requirements by State
Every state has different licensing needs based on the type of business you've incorporated, where it's located and the government rules in that state. We will research your business license needs for you with our Business License Research Package, but you can also do initial research yourself with the following resources:
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