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Obtain business licenses and permits (New Business Checklist)

In order to determine what licenses and permits you will need to legally do business, you need to answer two questions:

  • What type of business are you?

    If you plan on working as an independent consultant, you generally should require few licenses and permits. In fact, if you work out of your home in certain locations, you may not even require a business license. But if you plan on running a business that sells or uses things, those things typically will determine what types of licenses and permits you will require. For instance, if you decide to open a dental x-ray lab, you will have to conform to environmental, hazardous materials, and disability laws and regulations. Regulations also differ by industry. In order to find out which regulations you must comply with, call your local city hall, civic center, or chamber of commerce and consult your lawyer. They should be very helpful in explaining local requirements to you. Another great source of information are similar businesses located in the same area. If you plan on opening a restaurant in a certain neighborhood, talk to the owners of other restaurants already established there. Many occupations, such as medical doctor, require that you be licensed to practice. Contact your profession's regulatory board for assistance. For specific state requirements, start by visiting the Go online SBA's list of state links. If you don't find what you're looking for, check your state government's Web site and your state's Department of Consumer Affairs' Web site. The federal government also regulates some industries such as financial services, so check with the government.

  • Where will you do business?

    Because most laws and regulations are local, where you decide to do business is extremely important. Most cities and towns have strict zoning laws that determine what types of commerce may and may not take place in specific locations. For instance, you will find it extremely difficult to set up an auto body shop in an area zoned exclusively for residential use. Get a zoning map from your city or county planning commission. If you have any questions about zoning, call your city or town hall or your chamber of commerce.

    If you work out of your home, the licenses you are required to have are often determined by your business mailing address. If you use a business mailing service as your business mailing address, the regulations that govern your business will probably be determined by the location of the business mailing service and not by your home address.

    Before you sign a building lease, make sure you determine the specific regulations for your business. Also determine what changes you will need to make to the existing building. Exterior and interior architectural work is often regulated. Though the real estate agent may be helpful, he or she probably doesn't have enough specific information to give you definite answers to your questions. It is highly advisable to consult a professional such as a real estate lawyer.

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