Legal Question in Business Law in California

CA Business License

I offer an Account Receivable Service & I will be conducting these sevices in different Western States. Do I need a Business License for each state I am selling my AR services too? I have a Federal ID #.


Asked on 3/23/05, 5:18 pm

1 Answer from Attorneys

Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: CA Business License

Are you conducting the business as an individual or as a corporation? Corporations must register with the Secretary of State in each state where they do any significant amount of business, and then pay a franchise (or equivalent) tax.

Individuals doing business under a fictitious name generall must also register and/or file a statement of that fact, and some jurisdictions (including California) require publication of certain items in such a registration.

If by 'accounts receivable' you mean that you are going to be conducting a bill-collection activity, you probably already know that this occupation generally requires adherence to a whole bunch of regulations, and may require a license in some states.

Finally, I suggest doing some Web surfing to hunt for sites that describe what's expected of new businesses in each state. In California, requirements and recommendations for opening a new business would be found on the Secretary of State's Web site, www.ss.ca.gov, and for other states I would start with their S/S site then try economic development, etc. headings.

Yoyr federal number is probably a taxpayer ID number. When you begin deriving income from operations in various states, you will probably become subject to tax-return filing in each state, but the threshold for having to file and pay will vary from state to state, and the best self-help way to see where you have to register for, file and pay state income taxes is probably to get ahold of a copy of that state's tax forms and read the section entitled "who must file."

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Answered on 3/23/05, 6:11 pm


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