The Journey Begins
Let’s be real – starting a new business is a bear. Your to-do list is a mile long and seems to grow with every checked off item. Among the very first things to do when starting this adventure is to secure a small business registration in order to legally do business in the respective state. Depending on the type of business you have, you’ll need to zero in on exactly which type of small business license you’ll need.
What’s in a Name?
The first step in your small business registration process is to establish a legal business entity. Visit the website for the secretary of state of the state in which the company will operate (this article will show links and examples for California, but most states have similar requirements and procedures). Perform a search there for your proposed name to make sure it is available in that state. Once you’ve successfully cleared that first hurtle, you’ll simply follow the secretary of state’s registration process online to file for a limited liability company or corporation.
You may choose to remain a sole proprietor. This is a decision you’ll base on a few different factors which we’ll cover elsewhere. As a sole proprietor, you’ll need to file a “doing business as” registration, also known as a DBA, with the county clerk. This is usually possible in person, online, or via snail mail, with forms downloadable from the county clerk’s website.
Now that your entity is legally registered, it’s time to get a tax identification number for your business, otherwise known as an Employer Identification Number (EIN). This process is free and simply requires a visit to the IRS website to file Form SS-4. An EIN number will be required, along with the state registration numbers, to obtain a federal, state, or county permit and license.
Your next step is to determine which business licenses are required for the type of business you are operating. You’ll want to contact your local Board of Equalization (BOE) or Small Business Administration (SBA) office. Ask whether there are special county and/or state general excise (GE) tax license requirements. It’s possible you will also need a building permit or fire department permit if you are doing any type of construction or office space expansion.
If you’re in an industry such as insurance, building, or medicine, for example, you’ll need a professional license. Contact local professional organizations to learn about the resources required to file for the examination process and license. These licenses are industry-specific. There may be education and pre-registration background checks to complete before you can be licensed.
Depending on your industry, there will be specific permit and license requirements. These may include a transportation, aviation, or maritime license, for example. If you operate a grocery store, cafe, or restaurant, you may need a food permit as well as a permit for alcoholic beverages. A number of other business categories mandate licensing and permits, such as firearms and ammunition sales, and gaming, among others.
Now Accepting Applications
Once you’ve figured out which licenses and permits are needed for your business to legally operate, follow the BOE or professional industry guidelines to apply for a business license. For example, a real estate broker would need to pass a real estate broker exam before being licensed. The SBA or BOE would be the place to go for help with most state and county licensing regulations. The local commerce department will help you file for a seller’s license, for example.
You may need to apply for some permits and licenses in person at the county courthouse or at an industry professional organization. But chances are if there is a business-related online application, the SBA and BOE will be the best places to start. In any case, be sure to have your pertinent business information on hand, including entity registration and EIN.
Getting your small business off the ground can feel like a mammoth undertaking. But making sure you have all bases covered when it comes to permits and licensing will save you a ton of headaches in the future.
By the way, when it comes to marketing your new business, I know some of you have the time to implement a social media strategy yourselves. For those of you who are too busy, it makes sense to find help. Evaluate your situation, and decide where you want to spend your time. For more information or help, email me at email@example.com.