Business licenses are an integral part of a business getting off and running. It is actually a legal obligation to have the proper licenses and permits before you start your business operations. Business Licenses are administered at the federal and state level, as well as by local jurisdictions. The purpose of issuing business licenses are:
- To protect the safety of the general public
- To generate income for all levels of government
The first thing that you will want to know is the general criteria that will dictate which licenses are needed. They are as follows:
- The structure of your business
- The location of your business
- What your business does (HVAC, pool service, Amazon FBA)
- If the business has employees
Business licenses and permits are usually segregated by the level of government that issues them as well by the purpose of the license:
- At the federal level, a common license would be issued by the Food and Drug Administration (FDA), Environmental Protection Agency (EPA), or the Securities and Exchange Commission (SEC).
- At the state level there are usually regulatory licenses and permits for professions such as HVAC, Lawyers, real estate agents, and barbers.
- Additionally at the state level, any businesses selling taxable goods or services will be required to get a Seller’s Permit so they can collect and remit sales tax to the state.
- Some examples of local licenses and permits are occupational licenses, building and zoning permits, home occupation permits, and licensing from the local health department.
