By Matthew King | Business Planning

May 15

About every business needs some form of license or permit to legally operate…Failing to acquire licenses, or not doing it right from the beginning-is one of the most common mistakes new entrepreneurs make. However, licensing and permit requirements are dependent on the type of business you are operating, its location, and the government rules that apply.

State and local authorities require more business licenses than the federal government. When you start a business, there are federal and state rules and regulations that the company must abide by in order to legally operate and be devoid of violations.

State and local governments have broader regulations for businesses, and there are more local issues for small businesses to consider when starting up.

We would try to figure out what is required of your business for both state and local licenses. To ensure you face no difficulties getting your business up and running.

Requirements for state license

Business licensing requirements basically differ from state to state, but most state governments typically require the following types of licenses and permits:

  • State business license: It is essentially used to track and monitor businesses for tax purposes and are required for businesses to operate lawfully in the state. States have agencies that issue such license.
  • Tax registration: For states with a sales tax you will have to submit an application for a sales tax license to charge customers of your business.
  • Occupational licenses: All states regulate certain professions and require practitioners of those occupations to obtain (and maintain) licenses in order to do business. Licenses are required for doctors, lawyers, accountants, real estate agents, private security guards, funeral directors, private investigators, barbers, and many other professions. Contact your state’s licensing authorities in order to confirm whether having a license is required of your business.
  • Licenses for selling certain products: Certain products require licenses before they can be sold, like firearm and liquor.

Local Requirements

  • Register your business name: You definitely will have to register your business name with local agencies such as the county clerk, along with the business address. You’ll need to take care to pick a name that isn’t being used by another business.
  • Local business licenses: All businesses will need a license from the local government (city or county) to lawfully operate within their jurisdictions. This is in addition to having a federal or state license.
  • Health permit: For a food serving and preparing business, you will need to get a license.
  • Building permits: You will have to get building permits from local agencies, if you want to remodel or build a new space. You must as well ensure safety and confirm that the remodeling or new space conforms to local ordinances. You may also need permits for plumbing, electrical, and heat or A/C work.
  • Environmental permits: Local agencies also regulate the environmental impact of businesses, including issues such as air quality, water quality, and waste disposal.


About the Author

Matthew King is the owner of the Startup Forums, Alkries LLC, and co-owner at TR King Insurance Marketing. Partner at Independent Life Insurance Agent Association, Medicare Training 101, and Final Expense 101. When he's not creating content about running successful businesses here. He's most likely developing processes, diving into SEO, or gaming with his friends and wife.

Skip to toolbar