Business licenses are not hard to get. Still, it’s nice to know ahead of time what you are in for so you can set aside the time you need to get the job done.
Basically, you are going to put out a little cash (maybe even a few hundred dollars if you live in a City and County like San Francisco that has higher than average tax rates and fees for business licenses), stand in line and fill out a few short forms.
Every city and state has slightly different procedures, but the basics are all the same.
Getting business licenses takes maybe a couple hours of time, but it is worth it to be a legitimate business. Taking the time to go through the process means taking yourself, and your business, seriously.
I’ve been through the process twice and both times I have felt a sense of accomplishment. I know I’m not alone because my client, Caroline Fea, Owner, Cup of Tea Birth Doulas, recently went through the process and, after she had her paperwork in hand and receipts for fees paid, she sent me an email saying, “I feel such a sense of accomplishment!”
So, go ahead, make it official.
The first thing you need to do when getting business licenses is decide whether your business will be a sole proprietorship, a limited liability corporation or something else more exotic.
For most of us in the freelance, online marketing or consulting businesses, a sole proprietorship is more than enough to get started. If, however, you need to hire staff or start to make a LOT of money (I hope you have this trouble) you can always reconsider and “upgrade” later.
The second thing you need to do when getting business licenses is pick a name for your company. For online marketing purposes, a good bet is to use your name as the name of your business. Using your name is great for Search Engine Optimization (SEO) because it lends consistency to your brand and all of your social profiles.
No matter which name you choose, you need to find out whether someone has the name already, or not. In San Francisco and other cities, one way to find out if the name is taken is to go to your local city hall and do a name search at the public terminals provided for that purpose (this part is kind of fun!).
You can also send a letter of inquiry to the Secretary of State if, for some reason, you are not able to search the database in person. Instructions can be found at http://www.sos.ca.gov/business/be/name-availability.htm#checking.
After you have determined whether your name is available, you will have to file for a fictitious business name or dba (“doing business as”).
Since you are, most likely, already at the Mayor’s Office, go ahead and fill out the forms and pay the fees required for getting business licenses.
These forms and fees include:
- Business taxes (often to be paid quarterly)
- Fictitious business name forms and filing fees
In California, you must file and pay the fees within 40 days of starting to use your fictitious business name.
Taxes and fees vary by region.
Publish a copy of your fictitious business name statement in a newspaper that circulates within your county. In California, this must be done within 30 days of filing your fictitious business name.
The easiest thing to do is choose a newspaper, even if it’s a little more costly, that will send the affidavit (proof of publication) directly to your Mayor’s Office. It will save you a trip!
In San Francisco, staff provide you with a list of eligible newspapers complete with contact information.
Celebrate! You did it, and now your business is official!
Have you filed for business licenses? Let us know about your experiences in the comments.
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