Do I need a business license?

Written by NotALawyer Legal AI · Reviewed by External Legal AI · Published April 7, 2026 · Last reviewed June 26, 2026

Almost every business needs a license or permit to operate legally — including home-based businesses and freelancers. What you need depends on your location, industry, and business structure. Operating without the right licenses can lead to fines, forced closure, or even criminal charges. The upside: most licenses are straightforward to get once you know which ones apply.

Almost everyone needs a general business license

Most cities and counties require a general business license (sometimes called a business tax certificate) for any commercial activity in their area. This is separate from state requirements and usually runs $50–$400 per year.

Your industry may add specialized permits

Food service, construction, childcare, healthcare, and alcohol sales are among many fields that require specific permits and inspections. Some need a professional license — like a contractor's license — with exams and experience requirements.

Home-based businesses aren't exempt

Working from home doesn't let you skip licensing. You may need a home occupation permit on top of a standard business license, and zoning laws can limit what types of businesses run from residential areas.

Online businesses need licenses too

Selling online doesn't exempt you from licensing. You typically need a license in the state where your business is based, plus a sales tax permit if you sell taxable goods.

Check federal, state, and local rules separately

Requirements exist at all three levels of government, and meeting one level's rules doesn't satisfy the others. Start with the SBA website for federal rules, then check your state's business portal and your city or county clerk's office.

Your next step

Starting an LLC: Formation, Costs, and Staying Compliant
A limited liability company is formed under your state's law, so a few specifics — the filing fee, the business-license rules — depend on where you set up. This guide walks through the steps that look the same in every state, points you to your own state's official numbers, and explains the ongoing habits that keep an LLC's protection from quietly falling apart.

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More on this topic: the Small Business hub

Sources & primary references

State general business license by stateCompare the statewide business license in all 50 states.

This shows whether your state makes every business obtain a single state-level general business license or registration, or instead leaves general business licensing to your city or county. Each value is cited to the state statute or agency; a state with no sourced figure shows "Not yet sourced."

State	Statewide business license	Source
Alabama	Required (county-issued)	Alabama Dept. of Revenue
Alaska	Required statewide	Alaska Dept. of Commerce (DCCED)
Arizona	Not required	ZenBusiness state-license guide
Arkansas	Not required	ZenBusiness state-license guide
California	Not required	ZenBusiness state-license guide
Colorado	Not required	ZenBusiness state-license guide
Connecticut	Not required	ZenBusiness state-license guide
Delaware	Required statewide	Delaware Division of Revenue
District of Columbia	Required statewide	DC Dept. of Licensing & Consumer Protection
Florida	Not required	ZenBusiness state-license guide
Georgia	Not required	ZenBusiness state-license guide
Hawaii	GET license required	Hawaii Dept. of Taxation
Idaho	Not required	ZenBusiness state-license guide
Illinois	Not required	ZenBusiness state-license guide
Indiana	Not required	ZenBusiness state-license guide
Iowa	Not required	ZenBusiness state-license guide
Kansas	Not required	ZenBusiness state-license guide
Kentucky	Not required	ZenBusiness state-license guide
Louisiana	Not required	ZenBusiness state-license guide
Maine	Not required	ZenBusiness state-license guide
Maryland	Required (sellers of goods)	Maryland OneStop / Clerks of Court
Massachusetts	Not required	ZenBusiness state-license guide
Michigan	Not required	ZenBusiness state-license guide
Minnesota	Not required	ZenBusiness state-license guide
Mississippi	Not required	ZenBusiness state-license guide
Missouri	Not required	ZenBusiness state-license guide
Montana	Not required	ZenBusiness state-license guide
Nebraska	Not required	ZenBusiness state-license guide
Nevada	Required statewide	Nev. Rev. Stat. 76.100
New Hampshire	Not required	ZenBusiness state-license guide
New Jersey	Not required	ZenBusiness state-license guide
New Mexico	Not required	ZenBusiness state-license guide
New York	Not required	ZenBusiness state-license guide
North Carolina	Not required	ZenBusiness state-license guide
North Dakota	Not required	ZenBusiness state-license guide
Ohio	Not required	ZenBusiness state-license guide
Oklahoma	Not required	ZenBusiness state-license guide
Oregon	Not required	ZenBusiness state-license guide
Pennsylvania	Not required	ZenBusiness state-license guide
Rhode Island	Not required	ZenBusiness state-license guide
South Carolina	Not required	ZenBusiness state-license guide
South Dakota	Not required	ZenBusiness state-license guide
Tennessee	Required (county clerk)	Tennessee Dept. of Revenue
Texas	Not required	ZenBusiness state-license guide
Utah	Not required	ZenBusiness state-license guide
Vermont	Not required	ZenBusiness state-license guide
Virginia	Not required	ZenBusiness state-license guide
Washington	Required statewide	Washington Dept. of Revenue
West Virginia	Registration certificate	W. Va. Code 11-12-3
Wisconsin	Not required	ZenBusiness state-license guide
Wyoming	Not required	ZenBusiness state-license guide

General information, not legal advice. Rules change and exceptions apply — confirm the current rule with the cited source for your state.

NotALawyer.com provides general legal information, not legal advice.