Almost all businesses are required to obtain a business license or permit to do business in the county they are in. Some businesses and occupations are required to be licensed by the state as well. Begin by checking with your county business license office to see what licenses you will need. If you are within the boundaries of a city your will most likely need a city and county license. You will sometimes need a license for each county or city that you will be doing business in. Begin with your own county and as you get jobs out of your area obtain the proper licenses. If you know you will be doing jobs in an adjacent city or county it is a good idea to go ahead and get the proper licenses ahead of time. A license will usually run about $25 per year and once you get one you will receive a renewal form annually so you won’t have to remember to renew each year.
In some states and counties an additional contractors license is required. This is rare but you will run across this in a few places. If you are required to get this additional license it is not the end of the world. Look at it this way. A lot of your competition will not want to study for a test and pay an extra fee for the contractors license. That leaves you with less competition and the ability to demand higher prices for your work. In the end it can actually work to your advantage.
When you get your license, you should probably go ahead and apply with the state for your Tax ID number if your state requires that. If services are taxed in your state you will need that number to file a return each quarter or each month. If you are a Sub S Corporation or an LLC doing business under S Corp regulations then you will definitely need a Federal Employee Identification Number or FEIN. This is basically a social security number for your business. Easy to get and used when you pay yourself and once a year during taxes.
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