旼컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴� � LICENSING REQUIREMENTS FOR BUSINESSES � 읕컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴� @Q "Never forget that the bureaucrat who smiles when @Q something goes seriously wrong has already found @Q someone to blame it on." -- Jenkins' Ninth Law of @Q Business Survival IN GENERAL. Almost any kind of business activity you en- gage in will require a city or county business license, which is usually fairly simple to obtain. In addition, a few kinds of businesses will have to obtain licenses from the federal government to operate. Many kinds of busi- nesses, occupations and professions are also licensed and regulated by the state government. While there are wide variations in the kind and extent of requirements for ob- taining necessary federal and state licenses, these require- ments usually relate to educational attainments, experience in the particular field, passage of examinations, submis- sion of detailed applications, meeting financial or bonding requirements, or some combination of the foregoing, plus payment (almost always) of a licensing fee or tax. Also, you need to be aware of certain local city or county permits that you may have to obtain, such as from the coun- ty health department if you will be in the food business, from the fire department if your business may have large crowds on the premises (restaurants, theaters), or various permits for construction, remodelling or zoning. In some areas you may also have to prepare an environmental im- pact report before you can build or do other preparatory work. FEDERAL LICENSING. Some of the federal licensing require- ments you may encounter in different business activities include the following: ____________________________________________________________ ACTIVITY FEDERAL REGULATORY AGENCY ____________________________________________________________ Rendering investment advice Securities and Exchange Com- mission Providing ground transport- Interstate Commerce Commis- ation as a common carrier sion Preparation of meat products Food and Drug Administration Production of drugs or Food and Drug Administration biological products Making tobacco products Treasury Department, Bureau or alcohol of Alcohol, Tobacco and Firearms Making or dealing in Treasury Department, Bureau firearms of Alcohol, Tobacco and Firearms Radio or television Federal Communications Com- broadcasting mission ____________________________________________________________ @CODE: CA CALIFORNIA LICENSING REQUIREMENTS In California, most businesses, occupations and professions are likely to be licensed and administered by one of the many divisions of the California Department of Consumer Affairs. In addition, the State Business and Transporta- tion Agency licenses various financial institutions through its Banking and Insurance departments; real estate firms through the the Department of Real Estate; and the manufac- ture, distribution and sale of alcoholic beverages through its Department of Alcoholic Beverage Control. A number of activities are also regulated by various state agencies other than Consumer Affairs or the Business and Transporta- tion Agency, as well. Local business license taxes in California cities and coun- ties are often in the form of a flat fee or a percentage of payroll. However, many of the larger jurisdictions, includ- ing Los Angeles, San Francisco, Sacramento, Oakland and Fresno, have adopted license taxes based on the gross re- ceipts of the business. There are usually only a few, lim- ited deductions from "gross receipts," for purposes of com- puting such taxes, such as "non-business income," like in- terest or dividends or sale of business assets, and other items like federal excise taxes. Be sure you don't over- look any such deductions, which may be important in reduc- ing your local business taxes. The tax rates imposed by local taxing jurisdictions for business licenses often vary considerably, depending upon the type of business involved. For example, Los Angeles distinguishes between nearly 50 different types of business classifications. Obviously, where there is room for inter- pretation as to certain types of income of your business, it can save you money to treat ambiguous items as a type of income having a lower rate, if you have a choice, rather than as a type of gross receipts subject to a higher rate. @CODE:OF @CODE: HI HAWAII LICENSING REQUIREMENTS The state of Hawaii has a bewildering number of licensing requirements for businesses, occupations, and professions. In addition to specialized activities like medicine, law, architecture, and the like, there are also many more mun- dane businesses (such as cleaners and laundries, travel agencies, etc.) that are also subject to special licensing requirements. Licensing fees may range from a few dollars to $1,000 or more. For specific information on licensing, contact the Hawaii Dept. of Commerce and Consumer Affairs, on the first floor of the Kamamalu Building, at 1010 Richards Street in Honolulu. Phone: (808)/548-6111. Or, go to the Hawaii Business Action Center (One-stop center for all state permits at 1130 N. Nimitz Hwy., Suite A-254, in Honolulu). From Oahu, call the Business Action Center at: 1-808/586-2545; or, use Neighbor Islands Toll Free Number: 1-800/225-6723 @CODE:OF @CODE: DC FL @CODE:EN @STATE LICENSING REQUIREMENTS The state also licenses a great number of business activi- ties and professions, as well as the obvious ones such as the medical, dental, and legal professions, and various financial institutions. If you feel there is any possibil- ity that the business you are entering or are engaged in requires a state license to legally operate, contact one or more of the major licensing agencies in the state capital for more information on what may be required for your par- ticular type of business. @CODE: NV Nevada has enacted a new Business Privilege Tax, effective July 1,1991, based on the average number of employees a company has, generally at the rate of about $25 or $30 tax per employee per calendar quarter. You may not conduct a business in Nevada unless you first obtain a business li- cense from the state Department of Taxation and pay a $25 fee. @CODE:OF @CODE: WY Wyoming imposes an annual license tax on corporations, based on corporate assets located and employed within the state. The license tax has been raised, and beginning January 1, 1994, will be as follows: License Tax Corporate Assets ----------- ------------------------------- $25 (now $10) Not over $ 50,000 $50 (now $20) Over $50,000, up to $100,000 $100 (now $50) Over $100,000, up to $500,000 $200 (now $100) Over $500,000, up to $1 million $200 (now $100) For every additional $1 million additional (or fraction) over $1 million (Maximum corporate license fee limited to $50,000 a year) @CODE:OF @CODE: WA With only a few limited exceptions, such as for farmers and real estate rentals, the state of Washington requires almost every person, partnership or corporation doing business in the state to apply for a license and register before commenc- ing business activity. @CODE:OF