What Licenses Does A Courier Business Need?

Overview

Starting a successful courier business takes more than knowing how to transport items quickly. Starting a new business requires completing several steps, and obtaining licensing is an important one as it may impact your ability to operate legally.

The question, “what business license do I need to start my courier business” is common but hard to answer, as every location has different requirements. Your business will likely need multiple licenses, permits, and registrations from federal, state, and local agencies.

Let’s look at which licenses to consider when starting a courier business.

Related: Guide to starting a courier 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 Corpnet.

What Licenses Do You Need to Start a Courier Business?

State Licensing

In many states, the only license that is required is a driver’s license to operate a motor vehicle. Larger trucks require a commercial driver’s license (CDL) to operate legally.

A few states, such as New York, require a Lottery Courier Service License to transport items with the State of New York Gaming Commission.

In North Carolina, a Courier Service Profession License is required from the North Carolina Department of Commerce for any person or business transporting items in the state.

Local Licensing

Some cities require licensing as well. In Chicago, for instance, a Bicycle Messenger Service License is required for companies operating bicycle messenger services in the city. In addition to the license, a certificate of insurance, proof of workers’ compensation, legal entity documents, and a Certificate of Good Standing from the state are required.

 

In addition to courier-specific licensing, general business registrations are also required before starting a business. Each state has different requirements, so it’s important to research the laws in your state before starting.

Here are a few of the common licenses and permits that a courier business may need:

Legal Structure

When starting a business, the legal entity (also referred to as a business structure) needs to be selected. A legal entity refers to how a business is organized to operate. There are four main types of entities; sole proprietorship, partnership, corporation, and Limited Liability Company (LLC).

Each type of entity has its own pros and cons, such as liability protection, costs, and administrative requirements.

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

Business Name Registration

While not necessarily a business license, it’s worth noting that 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 business name, or assumed name).

Learn: How to register a DBA

Corporations and LLCs register are a little easier because the name is registered when the entity is formed with the state.

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

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 Number

While rare in many states for businesses offering strictly services, in some states, a state sales tax permit (also referred to as a business tax number or tax ID number) may be needed.  This permit creates an account number with the state’s Department of Revenue (or similarly named state taxing agency) to collect and remit sales tax.

Learn: How to get a sales tax permit in each state

Certificate of Occupancy

In most communities, a courier business will likely need to secure a Certificate of Occupancy (CO) before operating out of a commercial business location.  This certificate is typically obtained from the city and/or the county and allows a business to occupy and operate from a building. Before the certificate is issued, the building will need to comply with zoning regulations, building codes, and any other local requirements.

Before purchasing or leasing a location for your courier business, be sure to check with the local zoning department first to ensure the business can legally operate out of the chosen location.

 

While researching licenses and permits isn’t the most exciting thing when starting a small business, it’s critical to obtain all licenses and permits necessary to start your courier business.

To make sure your bases are covered, you can do it yourself and contact the city or local economic development office and request assistance. Additionally, there are companies that specialize in business license research, such as Incfile or Corpnet.

 

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