What are business licenses and why do you need them?
Business licenses, permits and tax registrations are government issued and allow you to operate your business in your industry, city, and state. While the exact requirements vary depending on the state and local jurisdiction, licenses and permits are a mandatory prerequisite for your business to operate legally.
Business licenses accomplish four specific tasks:
- They identify the business and make it accountable for its actions.
- They track the activities of the business for tax purposes.
- A business license protects public health and ensures that the business meets its minimum requirements.
- They notify citizens of activities that could impact them.
How do I determine which business licenses I need?
At the minimum, nearly every locality requires businesses to have an employer identification number (EIN), doing business as name (DBA), OSHA certification, and a sales and use permit. However, there are more than 100,000 different jurisdictions across the country, and each has its own required licenses and permits. Every business, industry, state, and city has a different set of regulations in place. Even if you start Googling for the answers, you might find yourself growing confused or perhaps even missing out on key licenses that your business needs. Our compliance package takes the guesswork out of meeting your license requirements by determining exactly which licenses you need for your business in your state and providing all the information and forms needed to file for them.
Is a business license the same as an LLC or Corporation?
Many business owners can be understandably confused by the differences between business licenses and business formation. While business formation sets up the structure and legal foundation for your business, business licenses give you the right to operate under certain conditions. One common example of a business license that most people are familiar with is a liquor license. A liquor license doesn't create a business structure, it only licenses your business to sell wine , beer, or mixed drinks to customers. The licensing process simply makes it possible for governments to enforce laws regarding the service that would otherwise be difficult to police.
What happens if I do not have a business permit?
If you conduct business without the proper licenses or permits, you may be fined or even have your business shut down.
We can help you determine what licenses and permits your business needs, and send you all the required paperwork for just $99. Click here to get started.