If you want to start a business, you’ll most likely need some type of business license. Find out how to get a business license to stay compliant at a federal and state level.
The first thing you should do is contact your city’s business licensing department. Most major will have a website with relevant applications. Once you file an application for a business license with the city, the city will make sure that your office or other business space is compliant with the city’s codes and zoning laws, which prohibit certain types of businesses from operating in certain areas.
In order to file an application, you will need a business name and a business address. The cost of a business license varies widely depending on the type of business you run and where the business operates. A business license could cost between $50 and $900.
Operating without a business license has serious consequences. You could be forced to cease operation of your business and close down completely. In order to reopen, you may have to wait a mandatory probation period, or you could be permanently prohibited from reopening.
Customers of your business could sue you for fraud or negligence, and you may end up paying a significant amount in legal costs.
In addition, your state, city, or the federal government may impose penalties in the form of monetary infractions for running a business without a license, depending on the type of business you were running.
You may need more than one type of license or permit to run your business. The local, state, and federal business licenses that you need will depend heavily on the industry. For example, you may need special licenses or permits for operating businesses dealing with liquor, firearms, or food.
Depending on your industry, your state might also require you to have a professional license, such as a beautician’s license or law license. The type of license you need could also depend on whether your business is registered as a limited liability company (LLC), sole proprietorship, or a specific type of corporation.
Be sure to check your state and local laws to find out whether you need more than one type of business license.
A business lawyer can help you understand which licenses or permits you need in order to legally operate your business. They can answer questions about the process and discuss your best options for opening a small business too.