How to Get a Home Business License

Summary

Many people who make money at home start out with a little side hustle that they don't intend to turn into a business. Often, they make a few bucks selling their homemade goods to friends and family, or take some extra work on the side. Because they don't intend to run a business, they often don't look into getting a business license.

However, whether an idea is to just make a little bit on the side, or you want to start a home-based business, it's possible you'll need a business license.

The problem with starting a business without a license is that if you get caught, there might be penalties and/or legal hassles. Because of the potential risk, it's worth it in the beginning to find out the legal requirements for running a business in your city, county and state. In most cases, you'll fill out a form, pay a fee, and you'll be in business.

Many people who make money at home start out with a little side hustle that they don't intend to turn into a business. Often, they make a few bucks selling their homemade goods to friends and family, or take some extra work on the side. Because they don't intend to run a business, they often don't look into getting a business license.

However, whether an idea is to just make a little bit on the side, or you want to start a home-based business, it's possible you'll need a business license.

The problem with starting a business without a license is that if you get caught, there might be penalties and/or legal hassles. Because of the potential risk, it's worth it in the beginning to find out the legal requirements for running a business in your city, county and state. In most cases, you'll fill out a form, pay a fee, and you'll be in business.

Business License Requirements Most localities that regulate business require a license. It's possible you live in one of the few places that don't (yet) have business licenses, but odds are your city or county requires one.

Why Are Business Licenses Needed?

Many people are tired of government regulation and control, which is really what getting a license is about. However, as a consumer, you'll see that business licenses are a good thing. A business license is necessary because:

It gives your local government notice of what you're doing, therefore, holding you accountable for what you do, and ensuring you don't do anything to harm the public. It's a source of revenue for your city or county, helping to fund schools, libraries, and other resources.

Benefits of Having a Home Business License

Properly registering your business offers multiple benefits. In addition to your conscience resting easier for abiding by the law, a license offers validation and gives you the documentation necessary to apply for a business bank account and business loans, if needed.

How to Get a Home Business License

The good news is that getting a business license is usually easy and affordable. You can find out about registering your home business by visiting your city or county's website online and looking for information regarding small business. You might be able to register online. The Small Business Administration has business license resources for all 50 states.

Before applying for a business license, you need to have a business name and determine your business structure. The steps to getting your license usually involve:

Go online or call your city or county office that deals with business licenses to learn the process. Fill out a form with your business information. Pay a fee, usually between $50 and a few hundred dollars.

Once you have your license, you're in business. Each year you do business, you pay a fee based on your earnings.

Other Registrations or Permits You May Need

Having a home business license puts you in business, but depending on the business you start, there are other licenses and permits you may need. Here's a list of possible additional registrations that may be required:

How to Get a Home Business License
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