Taxes and business licenses, how to take care of the legal mumble jumble

You are so excited to get your small business up and running. You have laid out your business plan and are ready to take off. Make sure that you have all of the licenses, permits and taxes that are required. You don't want to be shut down before you take off because you didn't have everything you needed.

Start at the top: federal level. Check with your state government and find out what permits or licenses you need on a federal level. A good place to check would be www.sba.gov or www.business.gov they both have great resources for starting a new business. Just a few of the businesses that will require a federal license are businesses that deal with meat, firearms, alcohol or tobacco. There are also federal licenses required for businesses in telecommunications and investment advising. These are only some of the businesses that have a federal requirement. Check to see if your business qualifies.

Something that all small businesses need to get at the federal level is a tax identification number or an employer identification number. This will make you a legal tax paying business. Don't forget that there will be taxes added to all of the licenses and permits that you are required to get.

Move down to the next step and find out what you need on the state level. This is where your business license and occupational license will come in. Examples of businesses that require occupational licenses are plumbers, contractors, electricians, auctioneers, barbers, cosmetologists, and private security guards. The requirements will vary by state and the level of certification will too. Make sure you have checked with your state government to see what you need.

Next would be to check with your city and/or county. They may have regulations for what can and cannot be sold within city limits. They may also have laws about where your business can and cannot be placed. For example if you are selling alcohol you may have to be so far from any schools. These will be the easiest to obtain, just go to your local government, but they may also be the hardest to comply with.

There are many different businesses that will require federal or even international licensing. If you are doing anything with exportation or importation there will many levels of licenses to get through. Mariners are also under very strict licensing laws.

You also need to check with the EPA before you start your business. There are some businesses that have to be monitored by the EPA to make sure they are not harming the environment or causing too much pollution.

If this all seems like too much, consider hiring a professional. If you are going to hire an accountant anyway, start there. Let your accountant deal with all of the license problems and regulations. They will also be able to work out the taxes that you will owe. If you are new at this you may find that hiring someone else is the most cost efficient way. They may be able to avoid potholes that you may not have seen.

If you get into business and you decide to expand, make sure that you get all of the required licenses for the changes you are making. Be sure to comply with the laws surrounding those licenses. If your business relies on the money from your alcohol sales then you better ID everyone, you don't want to risk loosing your liquor license and the profits from those sales. Keep it legal and you won't have any problems!

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