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What Licenses Does A Bookkeeping Business Need?

What Licenses Does A Bookkeeping Business Need?

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What Licenses Does A Bookkeeping Business Need?

Starting a successful bookkeeping business takes more than knowing how to give a good haircut. One important aspect of successfully starting a business is researching and applying for the licenses and permits that are needed to operate legally.

The question, “what business license do I need to start my business” is a common one, but in reality, a business will often need multiple licenses, permits, and registrations from federal, state, and local agencies.

Related: Guide to starting a bookkeeping business

While we have researched what licenses and permits your business may need, please be aware that there is no way for us to have uncovered every state and local requirement.

To not miss any important licenses and permits, we recommend also checking with your local Chamber of Commerce, economic development agency, or use a business license service like Incfile or LegalZoom.

What Licenses Do You Need to Start a Bookkeeping Business?

While there isn’t specific licensing for a bookkeeping business, there will likely be general licensing requirements to start a business.  Here are a few of the common licenses and permits that a bookkeeping business may need:

General Business License or Permit

Depending on where the business is located, a general business license or permit may be required. A few states require a business license; however, they are more commonly found at the city level.

Learn more: Business license requirements by state

Business Name Registration

While not necessarily a business license, it’s worth noting that in order to use a name for a business, many states require the registration of that name. Making matters more complicated, the process of name registration is different by state and the type of business entity.

For instance, sole proprietorships and partnerships generally need to register a business name (also referred to as a Doing Business As, DBA, fictitious name, or assumed name).

Learn: How to register a DBA

Corporations and LLCs register are a little easier in that their name is registered when forming the entity.

Related: What is the difference between a sole proprietorship, partnership, Corporation, or LLC?

Federal Employer Identification Number

The Federal Employer Identification Number (also referred to as a FEIN, Employer Identification Number, EIN, or Federal Tax ID Number) is a unique nine-digit number that identifies a business with the Internal Revenue Service (IRS).

Any business with employees or those that form as a partnership, Corporation, and in many cases an LLC, the business will need to get an EIN.

Sole proprietors and single-owner LLCs without employees can instead use the owner’s social security number.

Learn: How to get an EIN 

Sales Tax Permit or Business Tax Number

While rare for a bookkeeping business, a sales tax permit or business number may be needed in some states. This permit creates an account number with the state’s Department of Revenue or a similarly named state taxing agency.

Additionally, hiring employees will also likely require a state tax number.

Learn: How to get a sales tax permit

Certificate of Occupancy

In most communities, a business will need to secure a Certificate of Occupancy (CO) before operating in a commercial building.  This certificate is typically obtained from the city, but sometimes from the county, and allows a business to occupy and operate from a building provided the building complies with zoning regulations, building codes, and any other local requirements.

A Certificate of Occupancy (or home occupation permit) is also often required for a home-based business.

Before starting your bookkeeping business, be sure to check with the local zoning department to ensure the business can legally operate out of the chosen location.

Certifications

In addition to licensing, bookkeeping businesses can also obtain certification to gain additional skills and industry-specific knowledge. In addition to certification programs that are offered from universities and community colleges, there is a Certified Public Bookkeeper License through the National Association of Certified Public Bookkeepers.

Author

  • Greg Bouhl

    With over two decades as an entrepreneur, educator, and business advisor, Greg Bouhl has worked with over 2,000 entrepreneurs to help them start and grow their businesses. Fed up with clients finding and acting on inaccurate and outdated information online, Greg launched StartUp101.com to be a trusted resource for people starting a business.

What Licenses Does A Bookkeeping Business Need?

What Licenses Does A Bookkeeping Business Need?

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