You have your great
business idea and you want to get going. But before you get to the real work of
setting up a business, you have to get make everything legal. Business licenses
are necessary even when you have your approved corporation, proprietorship name
or other
legal business entity. For many jurisdictions, business licenses have to do with registering your business for taxation, but they also are part of how cities and counties oversee zoning, public safety and social impact of businesses. In short, your jurisdiction wants to know what you're doing. Business licenses are also helpful for getting a resale number if your business will be buying wholesale goods and wanting to avoid sales tax.
legal business entity. For many jurisdictions, business licenses have to do with registering your business for taxation, but they also are part of how cities and counties oversee zoning, public safety and social impact of businesses. In short, your jurisdiction wants to know what you're doing. Business licenses are also helpful for getting a resale number if your business will be buying wholesale goods and wanting to avoid sales tax.
Step 1
Check your county's
registry of fictitious business names to make sure there's not another local
business with the same name you want. Most county clerks, recorders and
registrars make registries available online. You will need an available and
legal business name in order to obtain a business license. You may also want to
check your state's list of corporations, which is kept by the secretary of
state and should also be available online. For proprietors there is one
exception to this rule. Proprietors who use their own names in their business
name do not need to register a fictitious business name. For example, sole
proprietors creating businesses named Smith Cleaners or Jan's Cafe do not need
a registered business name.
Step 2
Complete and file the
appropriate application to create your business entity. If you plan a
proprietorship or partnership, then you must register in your county or
counties of operation for a fictitious name. If you are forming a corporation,
limited liability company or limited liability partnership, file an application
with the state to create your business entity. Most states and counties make
applications available online. In a few rare cases, you may have to call and
ask them to fax or mail you an application.
Step 3
Contact your city or
county for a business license application. In larger cities like Los Angeles,
business licenses may be issued by the department of finance as a form of tax
registration.
Step 4
Complete the business
license application. While many cities want nothing more than your basic
business information, others, like Bellevue, Washington, want to know about
your business type and location in order to ensure that it's properly zoned and
will not cause a problem for the neighborhood or public safety.
Step 5
Submit your application
with the appropriate fee. Expect a wait time of anywhere from a few days to
several weeks. In some cases, if the municipality finds your business to be of
concern, you may be asked for further details by an official or even the city
council or county board of supervisors.
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