A business license is a permit issued by a government agency that allows an individual or company to conduct business within that jurisdiction. Requirements vary significantly by location — what is required in one city or county may not be required in another, even within the same state.
19 steps across 6 sections
1. Check Federal Requirements
- Most businesses do not need a federal license
- Exceptions: businesses regulated by federal agencies (alcohol, firearms, aviation, broadcasting, agriculture, mining)
2. Check State Requirements
- Visit your state's business licensing website
- Some states (e.g., Colorado, Texas) do not have a general statewide business license
- States that do require one often handle it through the Secretary of State or Department of Revenue
3. Check City and County Requirements
- Visit your local government website or call the city/county clerk
- The SBA provides a tool at sba.gov/business-guide/launch-your-business/apply-licenses-permits where you can enter your zip code to find local requirements
- Many cities have online portals for license applications
4. Check Zoning
- Verify your business location is zoned for your type of business
- Home-based businesses typically need a home occupation permit
- Retail locations may need a certificate of occupancy
5. General Business License
- A blanket permit to operate any business within a jurisdiction
- Required by most cities and many counties
- Sometimes called a "business tax certificate" or "business privilege license"
- Typically based on gross receipts or a flat fee
- Some jurisdictions (e.g., Charlotte, NC) do not require a general business license
6. Specific/Activity-Based Licenses
- Required for particular business activities (food service, alcohol sales, construction, home-based businesses)
- May be required in addition to a general business license
- Examples: health department permits, fire department permits, zoning permits, sign permits, home occupation permits
Common Mistakes
- Assuming one license covers everything
- Forgetting to renew
- Not checking zoning first
- Ignoring home-based business rules
- Operating before getting licensed