Business Permits and Occupational Licenses
Do I Need a Business License or Permit?
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Table of ContentsDo I need a business license?What are Professional & Occupational Licenses?What are Business Licenses?What are Zoning and Property Use Permits?What are Building Permits & Certificates of Occupancy?What is a Fictitious Business Name Filing?
What is a business license?
A business license is a license granted by a local municipality (city or county) authorizing a business to carry on business within the municipality.
The business license fee is a form of local tax.
A broader definition of a business license is any license or permit required for a business to carry on business.
Several licenses apply generally to all startup businesses. Below is an explanation of several of the more common licenses and permits that accompany starting a business. The licenses are listed in a general order of priority.
Different states, localities, and professional licensing agencies may requires additional licenses or permits before carrying on business operations. Use this list as a baseline for researching what types of licenses are required in your area to conduct your business activity.
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Do I Need a Business License?
A business license from the locality where you intend to operate grants permission to operate a business in that location. So, if you are going to carry on business in the location - yes, you need a license.
Licenses are granted from either the city or the county, depending on your location. Generally, you will need to apply for a business license in every locality in which you operate.
Can I Not Get a Business License?
Is it possible to carry on business in the location without a license. Yes - but, you may get fined if you are found out.
What If I am an Internet Business?
If you do not have any form of physical operations in the license granting jurisdiction, then you will likely not need a business license.
If, however, you hold yourself out to the public as carrying on a business from a given address, this is likely sufficient to warrant the collection of the business license tax.
What are Professional & Occupational Licenses?
Professional or occupational licenses apply to specific industries. For example, if you are going to operate an accounting firm, you have to be a certified public accountant. This same principle applies in a number of professions, such as: Law, Medicine, Engineering & Architecture, Real Estate, Accounting & Tax Services, Insurance, etc.
Likewise, the state or federal government may regulate certain types of products you sell or services you provide, such as Alcohol, Tobacco, Firearms, Pharmaceuticals, Investment Services (Securities), Food, Media, Transportation, etc.
The type of license required will vary by state, so do your research into your individual state requirements. Generally, the State Secretary of States website will provide a list of occupational licenses required by the State prior to carrying on a given business activity.
It may give a list of required federal permits as well. Example: The state and federal government may require permits for sales of food items.
What is a Zoning Permits?
Zoning or property use permits allow a business to carry on operations in a location that is generally not zoned for that type of activity.
In order to obtain a business license for a given location, you will need to make certain that the land is either zoned for the business activity or you must receive a land use permit to carry on that type of activity.
You can obtain a land use permit from the local government, generally at the zoning department.
What are Building Permits & Certificates of Occupancy?
New building or buildings that have been renovated are subject to local regulation. First, you must obtain a construction permit before undertaking the construction.
If you are building a new building you will need to have architectural plans for the construction approved. You will have to file these documents with the local agency responsible for building permits.
You will also have to make these filings if you are planning on building out your operations, expanding or carrying on construction to the building where you plan to carry on operations.
When the construction is complete, you will need to apply to the local zoning commission for a certificate of occupancy prior to starting business.
Generally, the building inspector will come out and inspect the building to make certain it meets zoning requirements, building codes, fire hazard standards, and other local regulations.
What is a DBA ?
A DBA or Doing-Business-As Filing (also known as a fictitious name filing) is a filing in a public office to give notice to the public that your company is carrying on business under a given name that is not its legally registered name.
Note: The reason for this rule is to prevent individuals from concealing their true identity from the public by carrying on business under a business name.
Many people carry on business as sole proprietors or as partners. This means that they likely are not registered with the secretary of states office.
If you decide to carry on business under a business name that is different from the name of the sole proprietor or partners, you will need to register that business name with the local government.
Similarly, if you are a registered business (LLC or Corporation), you will have a legal entity name. If you carry on business under a name different than this business name, you will need to file a DBA.
Where Do You File the DBA?
You file the Fictitious Business Name filing or Doing Business As filing with the local government or at the local courthouse where you will be operating.
If you are a service business, you must file in every county where you carry on services. If you are a manufacturer, you must file where you manufacture products or store inventory or raw materials.
Basically, as yourself if your business has a physical presence in a local jurisdiction. If so, you should file the DBA in that location.
Note: In some states, you may register the DBA with the Secretary of State's office. This provides you with state-wide coverage.