Does an LLC Need a Business License? A State-by-State Guide

Forming a limited liability company (LLC) for your new business is a smart move for protecting your personal assets, but it doesn’t automatically make your business fully compliant. In fact, 51% of small businesses say that licensing, certification and permit requirements make it harder to grow.¹

This guide explains when an LLC needs a business license, how to get one, and what to do to stay compliant in your state.

Does Every LLC Need a Business License?

Not every LLC is required to have a business license. The purpose of forming an LLC is to establish your business as a recognized legal entity with limited liability rather than a sole proprietorship. You must register your LLC with your state, but you may not need a business license depending on the jurisdiction and type of business you intend to operate.

There are several types of business license, including general state, county or municipality licenses; professional licenses for services such as physicians, attorneys, therapists, and accountants; sales tax licenses; and zoning and building permits. You may need to apply for multiple licenses depending on your business.

How do I check if my LLC needs a license?

Does an LLC need a business license in Florida, Georgia or California? To find out if you need a business license for your LLC, you should first check with your local city or county government. This is typically the business division or licensing office. You can also visit your state’s official business portal or Secretary of State website. For federal licensing requirements, consult the US Small Business Administration (SBA).²

If you are still not sure, contact a local business attorney or licensing consultant for advice.

What happens when an LLC operates without a business license?

It is crucial that you are clear on what licenses you need. Operating without the required licenses can lead to fines or penalties and could even result in authorities forcing your business to close.

Operating without a business license can also make it difficult to open a business bank account or sign contracts with clients. And it can result in your business incurring legal liability that overrides the LLC’s limited liability protections.

When Does an LLC Need a Business License?

If you determine that you do need a license, you should obtain it before you start any business activities to make sure you fully comply with government regulations. As you need to provide your business name on the application, you should register your LLC first so that you can use the approved legal name to apply for the license.

There are several factors that influence whether your LLC needs one or more licenses:

Industry: Food service, alcohol sales, transportation, healthcare, construction, and other regulated sectors typically require specific business licenses.

Location: Certain city, county and state governments can have separate, specific requirements.

Business type: Home-based businesses, online-only businesses, and brick-and-mortar stores have different requirements.

Federal, State, and Local Business Licenses

Depending on the type of business and the location it will operate from, you may need to obtain licenses at multiple levels.

Federal licenses are required for businesses in regulated industries such as agriculture, broadcasting, mining and drilling, aviation, and firearms.

Nine states have a general business license:³

• Alabama
• Alaska
• Delaware
• Hawaii
• Maine
• Maryland
• Nevada
• Tennessee
• Washington

State regulations typically apply to professional services like law, real estate, childcare, mechanics, plumbing, electrical, hair and nail salons.

City and county municipalities may require a general business license or permit to operate within their jurisdiction.

If you will run your business from a physical location, such as a restaurant, salon or childcare facility, you may need building, fire department and health and safety permits to ensure it complies with safety regulations.

How to Obtain a Business License for an LLC

It is not difficult to file for a license or permit as long as you do your research or consult a lawyer.

Researching Licensing Requirements

Check the Small Business Administration (SBA)’s online licensing lookup and apply for the licenses it suggests. Check with your state’s business licensing agency and your city or county clerk’s office to see what licenses and permits they require.

Keep a list of all the licenses you might need at the various levels and the progress of your applications to keep track.

Application Process and Costs

Applying for business licenses typically involves completing an application form, either in-person or online. You will need to provide your LLC formation documents as well as your business address and employer identification number (EIN). You may need to pay an application fee, which can range from $25 up to hundreds of dollars depending on the type of license.

Operating a business in certain industries may also require you to complete background checks, home or building inspections, or provide proof of insurance.

Renewing and Maintaining Compliance

Most licenses must be renewed every year, so it is essential to keep track of when they expire so that you can remain compliant.

Missing renewal deadlines can result in late fees or having your license suspended.

Understanding Business Licensing for LLCs

Business licensing is a way for federal and local governments to monitor economic activity, collect taxes, and protect consumer health and safety. The licensing process ensures that your LLC meets public safety, zoning, and regulatory standards.

What is a Business License?

A business license is a formal authorization from a government department that allows you to legally operate a business within a specific jurisdiction.

Difference Between Business Licenses and LLC Registration

What is the difference between registering an LLC and obtaining a business license? They have separate purposes and an LLC is not a substitute for a business license.

LLC registration is the legal process of forming a company. There is no actual license required to form an LLC, and an LLC does not give you a license to operate a business. A business license is a separate authorization that permits you to operate legally in your industry and location.

Most businesses need some form of business license to operate, whereas an LLC is optional. If you have a business license but not an LLC, you can still operate a business as a sole proprietor.

Discover Wise: Manage Your LLC’s Finances With Ease

When you start a new business you should budget for the fees you will need to pay to apply for licenses. Opening a business account will help you keep track of your expenses from the start.

But opening an account can be a hassle, and choosing the right business account can make all the difference, especially if you'll be sending or receiving payments from other countries.

Wise is not a bank, but a Money Services Business (MSB) provider and a smart alternative to banks. You can open an account 100% online, with no need to wait in line or book appointments.

The Wise Business account is designed with international business in mind, and makes it easy to send, hold, and manage business funds in 40+ currencies. You can get major currency account details for a one-off fee to receive overseas payments like a local. You can also send money to 140+ countries.

Open a Wise Business account online

	Editor & Business Expert:
	Panna is an expert in US business finance, covering topics from invoicing to international expansion. She creates guides and reviews to help businesses save time and make informed decisions. You can read more useful business articles on her author profile.

	Author:
	Nicole is a professional journalist with two decades of experience in writing and editing, she has also run her own freelance business for the past five years. Her expertise spans the financial and technology industries, including payment processing and small business banking.

Sources:
¹ https://www.census.gov/econ/bfs/current/index.html
² Apply for licenses and permits | U.S. Small Business Administration
All sources checked August 2025.