New seller. Do I need a business license.?
I just formed an LLC and got EIN from IRS, however, I am wondering if I need a business licenses to work from home. I have only FBA and will not store at home any products. I live in Concord, CA. Not sure if I need the business lionesses since I am not going to sell or invite anyone to come to home to do any any business.
Any help will be really appreciated.
Sam
8 replies
Seller_zyG3AlejdFqKL
yes - you should apply for business license
it’s helpful if you apply for loan , home refinancing from your bank , collecting tax from amazon etc…
Seller_lYLz1roOGTQRE
I don’t know how CA operates, but business licenses are not usually required if you do not have a storefront. You will have to contact your local government about their requirements.
However, you will need a state tax ID number so you:
- will not have to pay sales tax on your inventory, and
- can submit sales tax to the state for items sold to buyers in CA.
You also need the tax ID number to sign up for Amazon’s sales tax collection service.
Seller_CW0P5hgbsiqWX
Well Uncle Sam, you went about it all the wrong way. You need neither a LLC of EIN to obtain a business/Traders license, which should have come first. Now the trader’s license will have to be in the LLC;s name. Hope you didn’t use Legal Zoom, falling for their adds. A sole proprietor would have been a lot cheaper when selling from home. Then when and if your business starts to be worth say, 100,000 or more, do the LLC. 
Seller_mWZyJunCxCR84
You get a business license from the city you live in. Different cities have different rules. When I lived in California, the city I lived in required me to get a business license since I had a home based business. Contact the Concord City Hall and talk to the business license department.
Seller_e26s0tsFxML6N
If you are just selling on Amazon you don’t need an LLC or anything from the Feds, it is unnecessary. You should only obtain a business license as a DBA. You can obtain that at your local Tax Collector’s Office. Then take that to your local State Sales Tax office and get your Resale number. This will allow you to purchase materials wholesale, every supplier requires that. And you will file your sales tax on line, quarterly if it is not much. Even if all sales are out of state, you must file and just put the sales from Amazons figures as exempt. It’s no big deal.
To do your federal income tax you will add the income from Amazon to your personal income tax using the Schedule C. If you want to claim use of your home as a business office you will file Form 8829.
Of course this was then and we can only guess what the master plan is for next years federal income tax…
