Starting a business in Texas will mean potentially registering with a number of federal, state and local agencies. Let’s take a look at common licenses and permits a business will register for in Texas.
Business License – There is no general state of Texas business license, however many cities require businesses to be licensed in order to operate. Rules for business registration vary depending on location and what the business does. Below are a few cities that have licensing requirements.
Houston – While there isn’t a business license registration in Houston, businesses in Harris County are required to report business use of property valued at over $500. There is a Business Personal Property Rendition form that will be filed annually.
A Certificate of Occupancy is required for businesses operating in a commercial building from the Houston Planning and Development District.
San Antonio – Businesses operating out of a commercial building will need to obtain a Certificate of Occupancy.
Additionally, a few types of businesses such as those selling alcohol, using coin operated machines or peddlers will need a license from the city.
Dallas – A Certificate of Occupancy is needed for the commercial use of a building in Dallas. The cost for this license is $215 plus a $65 Code Compliance Fee.
A Dallas business license is needed for several types of businesses such as amusement centers, businesses selling alcohol, precious metal vendors and others.
Employer Identification Number (EIN) – Many businesses will register with the Internal Revenue Service (IRS) for an EIN or Employer Identification Number. The EIN is the business equivalent for a Social Security Number for an individual. Corporations, Limited Liability Companies, Partnerships and Sole Proprietorships with employees will all need to register for one. Sole Proprietorships without employees can use the owner’s Social Security Number.
There is no cost for an EIN and it only takes a few minutes to get.
Texas Sales Tax Permit – Businesses that are engaged in selling or leasing tangible personal property or taxable services in Texas need to register for a Texas Sales Tax Permit from the Texas Comptroller.
Resale Certificate – Businesses purchasing merchandise to resell will usually want to obtain a Texas Resale Certificate in order to not pay sales tax for merchandise that is being resold to customers.
Professional License – A variety of professions in the state are regulated and need to be registered before offering certain services. A few common professions that require licensing in Texas include; therapists, tattoo studios, salvage brokers, food establishments and many more. Additional information, fees and licensing requirements for professions are available from the Texas Department of State Health Services.
Assumed Name Registration – While not a business license, it’s common for Sole Proprietorships and Partnerships operating under a name that is different from the full name of the owner(s) to register for an Assumed Name (also known as a Doing Business As or DBA) with the County Clerk’s Office in the county where the business is located.
These are a few of the most common business licenses, but there are way too many licenses and permits in Texas for us to keep track of. Before starting your business, check with the City Hall, County Clerk, Chamber of Commerce and/or Economic Developer in your area to get more information regarding business licensing. Additionally, there are companies like IncFile or CorpNet that can do the research to ensure you have the proper federal, state and local licenses.