General Licenses and Permits
Some states, counties and cities require all businesses, no matter how small, to have a basic business license. Some municipalities exempt home-based businesses except those in certain industries. Be sure to check all the regulations you might be subject to, including at the federal level.
There are several other general licenses or permits that might apply to you.
Fictitious Business Name: Unless you are operating under your own legal name, you will need to register your business name with the county clerk. This is sometimes also called â€œdoing business asâ€ or â€œdba.â€ You may also need to publish a notice of your legal and fictitious names in a local newspaper for a certain number of days.
This is not usually necessary if you are incorporating, as the business will become a new legal entity with its own legal name.
Employer Identification Number (EIN, FEIN): If you will have employees, you need this federal identification number, issued by the Internal Revenue Service. Some state departments of revenue also issue similar numbers for businesses based in that state.
Sales tax licenses and numbers: If you are selling any products or services on which sales tax must be collected, you need to get this number from your state's department of revenue or treasury department. This department can also provide instructions for reporting and submitting your collected taxes to the state.
Building permits: If you need to renovate a space or construct a new building for your business, you will have to submit your plans to the appropriate city or county office and get permission before beginning work.
Certificate of occupancy: You may need permission from your local zoning department before you can begin to use a particular building for your business.
Industry-Specific Licenses and Permits
Other licenses and permits are specific to certain industries.
Zoning and/or land use permits: Manufacturing businesses usually need these to ensure they are operating in an area zoned for your type of industry. Some types of home-based businesses might also need them. Zoning can also regulate parking, sign size and placement, and waste disposal.
Health department permits: Any business involving selling or preparing food will need regular health department inspections.
Fire department permits: You may need this if you will be serving a large number of customers at once, like a nightclub.
Licenses for certain products: Many states require that you have a license to sell items that are heavily regulated, like guns, gasoline or liquor.
Professional licenses: Certain types of services require state licensing, usually for both the business and any employees offering that service. Licensing involves proving that you have the required training or skills to perform the services. Professional licenses include, but are not limited to:
- Tax services
- Real estate sales
- Insurance sales
- Medical care
- Auto repair
- Limo driver
Some business types also need licensing from certain federal government departments, including those that:
- Manufacture drugs
- Manufacture alcohol or tobacco
- Manufacture or sell firearms
- Prepare meat
- Give investment advice
Once you have all your licenses, you should set up a system for keeping them current and accurate. If your employees need professional licenses, you will also want to ensure they stay current.