Guide to Business Licenses: Types and How to Obtain Them

Launching a new business requires compliance with various legal requirements. Securing the appropriate licenses and permits from federal, state, and local authorities is essential for lawful operation. These requirements vary depending on your location, business type, and industry regulations. Below are common licenses you may need:

Business Operation License
Enables you to operate within your city or state. These can typically be obtained from city, county, or state agencies.

Seller’s Permit
If your business involves sales, you’ll need a seller’s permit to collect sales tax from customers.

DBA or Trade Name Registration
This allows you to run your business under a name different from your legal personal or corporate name, often requiring registration at local or state level.

Special Permits
For brick-and-mortar setups, additional permits like zoning, building, signage, or fire safety approvals might be necessary.

These permits are governed by local legislation. Certain industries, such as health, legal, or technical sectors, may require specific industry licenses issued by your state licensing boards. Examples include licenses for salons, electrical work, healthcare, or legal practice.

State licenses and permits may also be needed depending on your business’s nature and location. Industries such as construction, restaurants, retail, and agriculture often fall under these regulations. Some sectors, such as firearms, mining, or broadcasting, require federal approval, which can be obtained through agencies like the Small Business Administration.

Choosing the right legal structure—such as sole proprietorship, partnership, LLC, corporation, or nonprofit—can influence licensing costs and renewal obligations. Fees may range from $50 to several hundred dollars, often requiring periodic renewal to remain compliant.

To identify your licensing requirements, consult:

State’s Secretary of State or Business Licensing Departments

Local Small Business Administration offices or websites, using your zip code for tailored information

Legal advisors specializing in business law

Applying for a Business License

Once you recognize which licenses are applicable, begin the application process. Many permits can be applied for online via the respective agency’s portal, though industry-specific licenses may involve more detailed procedures and longer review times. The general steps include:

Research local, state, and federal rules relevant to your industry

Complete and submit your applications with all required documents and pay applicable fees

Common application requirements encompass:

A detailed business description, operational activities, and physical location

Corporate documents like bylaws or articles of incorporation

Tax registration and status proof

Owner information and authorized signatories

Industry-specific businesses may need to submit additional materials, such as insurance certificates, professional credentials, or financial statements. Processing times vary from a few days to several weeks. After approval, ensure timely renewal of your licenses to maintain legal compliance. To ease this process, consider hiring a professional application service or consulting an attorney experienced in business licensing.