A government-issued permit authorizing a business to operate legally within a specific jurisdiction.
A business license is a permit issued by a government authority (federal, state, or local) that gives a business legal permission to operate. Most businesses need a general business license from their city or county. Some industries require additional state-level licenses (contractor licenses, food service permits, professional licenses). Federal licenses apply to specific regulated industries like alcohol, firearms, aviation, and broadcasting.
Requirements vary significantly by location and industry. A food truck in Los Angeles faces different licensing requirements than the same business in Austin. A licensed contractor in California needs state licensing board approval that a handyman in Texas might not. The Licensing & Permits tool in Takeoff is designed to surface the specific requirements for your state and industry.
Operating without required licenses can result in fines, forced closure, inability to collect payment for work already done, and personal liability. Many business licenses need annual renewal. Some, like contractor licenses, require proof of insurance and bonding. Keeping licenses current is part of basic business compliance.