Most US businesses need at least one business license or permit, but there's no single national business license. Which ones you need depends on what you do and where you do it: a few activities need a federal license, and most licensing happens at state, county or city level.
That's why the question has no one-line answer. The SBA's own guidance says most small businesses need a combination of licenses and permits from both federal and state agencies, and that business license fees vary by location and activity. Here's how to work out your own list without paying a filing service to do it for you.
Step 1: check the federal list
The SBA says business activities regulated by a federal agency need a federal license or permit. If none of these describe what you do, you probably don't need anything federal:
| Business activity | Federal agency the SBA points to |
|---|---|
| Agriculture: importing or moving animals, animal products, biologics, biotech or plants across state lines | U.S. Department of Agriculture |
| Alcoholic beverages: manufacture, wholesale, import, retail sale | Alcohol and Tobacco Tax and Trade Bureau, plus your local Alcohol Beverage Control Board |
| Aviation: aircraft operation, air transport, aircraft maintenance | Federal Aviation Administration |
| Firearms, ammunition and explosives | Bureau of Alcohol, Tobacco, Firearms and Explosives |
| Fish and wildlife, including wildlife import and export | U.S. Fish and Wildlife Service |
| Commercial fishing | NOAA Fisheries Service |
| Maritime transport of people or cargo | Federal Maritime Commission |
| Mining and drilling on federal lands | Bureau of Safety and Environmental Enforcement |
| Nuclear energy and nuclear materials | U.S. Nuclear Regulatory Commission |
| Radio and television broadcasting | Federal Communications Commission |
| Oversize or overweight vehicles | Your state issues the permit; the Department of Transportation can direct you |
Notice what isn't on that list: consulting, coaching, design, marketing, ecommerce and most online services. For those, the licensing question is almost entirely local, which means your city and county websites matter more than any federal agency.
Step 2: check your state, county and city
The SBA says states tend to regulate a broader range of activities than the federal government, and you may also need licenses from your county or city. Activities it lists as commonly regulated at the local level include:
- Auctions
- Construction
- Dry cleaning
- Farming
- Plumbing
- Restaurants
- Retail
- Vending machines
Its advice is to research your own state, county and city rules and start with your Secretary of State's website, because industry requirements often vary by state. In practice that means three searches: your state's business portal, your county clerk, and your city's business licensing or tax office.
Step 3: don't forget zoning if you work from home
This is the one home-based founders miss. The SBA says you might have fewer zoning restrictions if you run your business from home, but zoning ordinances can still apply to home-based businesses. Zoning is controlled locally, so check with your city planning department, especially if customers visit, you store stock or you put up a sign.
A quick way to build your list
- Write one sentence describing what you sell and how you deliver it.
- Check it against the federal table above.
- Search your state's official business portal for licenses tied to that activity.
- Check your county and city for a general business license or tax registration.
- Check local zoning if you work from home or rent premises.
- Diary every expiry date: the SBA notes some licenses expire after a set period and it's often easier to renew than to apply again.
License, registration or tax ID?
People mix these up. Registering your business name or entity with the state, getting a federal tax ID and getting a license are three separate jobs. The SBA's guide puts them in that order: choose a structure, register the business, get federal and state tax ID numbers, then apply for licenses and permits. If you've formed an LLC, that's registration, not licensing. My guide to getting an EIN for a small business covers the tax ID step, and LLC versus sole proprietorship covers the structure decision that comes first.
What a business license costs
There's no single figure. The SBA says requirements and fees depend on your business activity and the issuing agency, and that business license fees will vary by state, county and city. Be wary of any site quoting one national fee: it's either an average or a service charge layered on top of the government fee.
Outside the US
Everything on this page is about US licensing, taken from the SBA. The UK, Canada and Australia use different terms and different systems, so if you trade there, start with your own government's business portal rather than a US checklist.
My verdict
For most online and service businesses in the US, the answer is: nothing federal, probably a city or county business license or tax registration, and maybe a home occupation check. Spend 30 minutes on your state, county and city sites before you pay anyone, write down every renewal date, and keep copies of each license with your formation documents.
Want AI doing the heavy lifting in your marketing?
I build the systems that handle the boring 80 percent, so you get your week back. Done properly, with the human kept in.
If you plan to trade under a name other than your own, our DBA guide explains how to register it.
Frequently asked questions
Do I need a business license to sell online?
There's no federal license for selling most products online. The SBA says licensing depends on your activity and location, so check your state, county and city for a general business license or tax registration.
Is there a federal business license?
Not a general one. The SBA says only activities regulated by a federal agency, such as alcohol, firearms, aviation, broadcasting or commercial fishing, need a federal license or permit.
Do home-based businesses need a license?
Often, yes, at city or county level. The SBA also warns that zoning ordinances can apply even to home-based businesses.
How much does a business license cost?
The SBA says fees depend on your business activity and the issuing agency, and vary by state, county and city. There's no single national fee.
Do business licenses expire?
Some do. The SBA says some licenses and permits expire after a set period and it's often easier to renew than to apply for a new one.
Is an LLC the same as a business license?
No. Forming an LLC registers your business with the state. Licenses and permits are a separate step, according to the SBA's launch guide.
Where do I find which licenses my state requires?
The SBA suggests starting with your Secretary of State's website, then checking county and city requirements.
