Licenses and Permits: Overview
It may seem strange to you that your small consulting service or home-based handknit sweater business would need to comply with numerous local, state and federal licensing and permit requirements, but in all likelihood it will, so it is important to understand what to expect.
Business licenses and permits can range from the general (a basic license to operate a business within a city or county), to the specific (a state permit to sell alcohol or firearms). Bear in mind that regulations vary by industry. Carefully investigate the licensing and permit requirements that affect your industry, and avoid any temptation to ignore these important regulatory details. Being out of licensing and permit compliance could leave you unprotected legally, may lead to expensive penalties, and can jeopardize your business.
Who Issues Business-Related Licenses and Permits?
Business-related licenses and permits are issued at all levels of government -- federal, state, and local (city, county, or town). For example, if you decide to open a bar and grill in the city of Chicago, you will need to obtain all necessary licenses and permits from the city of Chicago, the state of Illinois, and the U.S. government. So, you will most likely need (among other possibilities) a federal tax ID number from the U.S. government, a license to sell alcoholic beverages from the state of Illinois, a health permit from the city of Chicago (to prepare and sell food), as well as a basic business license to operate the bar and grill within the city. A discussion of these and other types of licenses and permits follows below.
What Types of Licenses and Permits Does a Business Need?
Following is a discussion of some of the most common types of licensing and permit requirements that affect small businesses. This list is by no means exhaustive, and it is important to check with government agencies at all regulatory levels to ensure that your business has obtained all necessary licenses and permits:
Business Licenses. There are many types of licenses. You need one to operate legally almost everywhere. If the business is located within an incorporated city's limits, a license must be obtained from the city; if outside the city limits, then from the county. For more information contact the county or city office in your area or try these state web sites that offer business license information
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