Does my Business Need a Business License?

Business licenses are not required for every type of business and they are not required in every city or county jurisdiction. A business license is typically issued by the city government. To determine whether you need a business license for your particular business, you may first want to check out your city’s website for information. However, it’s a good idea to always call and validate what you are finding online. Sometimes, you may not understand exactly what you’re reading when you read city legislation, you may miss key information that would have required your specific business to have a license, or the website may be out of date.

For example, when we started our first business, we "officed" out of our house. The city we were located in did require a home-based business license, but did not require a business license if we would have had an office outside the home. This was unique to the city we were located in and would have been difficult to ascertain based on the information online.

You may also find that some cities do not require a business license, but they do require an occupancy license. An occupancy license is typically a license required when you move to a new business location. City officials will come to your new office to inspect your space and ensure you are compliant with any requirements, and then give you a license to “occupy” the space. You typically cannot start operating in your space without this license.

Other licenses may be required for your business, depending on what type of business you are in. Some licenses are issued by the state, while others are issued by your local city or county jurisdiction:

• Liquor License
• Food Safety License
• Daycare License
• Healthcare Provider License
• Cosmetology License
• Contractor’s License
• Professional Licenses
• And many more!

Some licenses are relatively simple and inexpensive to get, while others cost a lot more and take a lot more work to obtain. Some licenses are one-time licenses that do not require renewal, while others must be renewed annually. Start with your City government office, then check with your Secretary of State. If you feel that you are in a really complicated business, it may be best to meet with your attorney to review any license requirements they feel you need to comply with.

Typically, you’ll need to have your licenses or permits conspicuously displayed in your office, storefront, or warehouse.

Pro Tip: If you’re in lots of different cities or states, setup a license tracker to keep track of required licenses, renewal dates and certificates.