The last thing you want to know after starting your business is that you broke the law by not applying for the correct permits for your business. Before setting up a small business, you should pay attention to the regulations in your town, city, and county. In most places, all businesses need a basic license which is sometimes called a tax registration certificate. Other than this, other permits and licenses may also be required.

Business licenses and permits are issued at all levels of government: federal, state, and local (city, county, or town). Depending on the type of business you are running, you may need to apply for licenses at various levels. For example, if you decide to open a restaurant in the city of San Francisco, you will need a business license and health permit from the city of San Francisco, a sales tax license from the state of California, and a federal tax identification number from the US Federal Government.

Not sure what kind of license or permit you need for your business? Well, as usual, we’ve made it simple for you. Below is a quick checklist covering the most common federal, state and local licenses and permits you may need to acquire before starting your business:

Business License – This is the basic license you will need to legally operate a business. If the business is located within the city limits, a city license must be obtained; if it is outside, it is obtained from the county. Contact your city’s business licensing department to apply. Also remember that you have to pay an annual fee.

Federal Employer Identification Number (EIN): Also known as a tax identification number, it is required for almost all types of businesses. Depending on where your business is located, you may also need to acquire a similar tax identification number from your state.

Zoning and Land Use Permits – Before you start your business, you should find out if the space you will be using is properly zoned for the type of use that is planned. You may need a zoning compliance permit. Zoning laws regulate off-street parking, waste disposal, and the size, construction, and placement of signs.

Health Department Permits: If your business involves the preparation and/or sale of food, you will need a permit from the county health department. Please note that the health department will inspect your facility before issuing one.

Sales Tax License – This license is essential before you can sell almost any product or service in any state.

Fire Department Permits: Businesses such as restaurants, day care centers, or any other that attract a large crowd need a fire department permit.

State-issued special business licenses or permits: You may need special licenses if your business involves the sale of certain types of products, including liquor, lottery tickets, gasoline, and firearms.

State-Issued Special Occupational/Professional Licenses: In many states, people in certain occupations are required to have occupational licenses or permits. A state license is generally required for auto mechanics, plumbers, electricians, construction contractors, collection agents, insurance agents, real estate brokers, repossessors, and personal service providers (estheticians, cosmetologists, therapists, and massage therapists). . If you are thinking of starting one of these businesses, you will need to pass the state exams to get the permit. Contact your state government offices for a complete list of licensed occupations.

Special Federal Business Licenses or Permits: You may also require special business licenses from the federal government if your business involves investment advice, drug manufacturing, meat product preparation, broadcasting, tobacco, alcohol, or firearms manufacturing.

License and permit requirements for small businesses vary from state to state; therefore, it is a good idea to contact your state and local government to determine the specific obligations of your new business.

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