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6 Tips for Navigating the Maze of Business Regulations

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Making sure your company is in compliance with all proscribed business regulations is neither an enjoyable or easy task, but it is critical to remain within the law, or you risk undermining your entire operation. For a small business, most of the legal wrangling will be at the state and local levels and regulatory requirements vary depending on business size and type, so it's crucial that you familiarize yourself with the applicable business regulations or else hire someone to advise you.

Here are six items of interest pertaining to business regulation requirements at the federal, state and local levels to weigh before you open for business:

1. Licenses

Most city, county and state governments require business owners to obtain business licenses, and the federal government may also require you to secure special licenses, depending on your industry type. Here are some licenses to look into obtaining:

  • Local business licenses: Most every business will need a county or city license to legally operate within those locales. Fees usually are reasonable and the licenses easy to obtain.

  • State business licenses: These are issued to those selling products or services regulated by state law, and there are special state licenses for doctors, lawyers, barbers, mechanics, building contractors and other professionals who require certification. Businesses required to meet state standards or codes, like restaurants and other establishments that serve alcohol, also need state licensing.

  • Sales tax licenses: Nearly all states require a sales tax license or permit for all retail businesses, which in turn allow you to charge your customers a sales tax.

  • Federal licenses: Most businesses won’t need federal licensing, but certain highly regulated industries such as drug manufacturing, investment advice, and selling alcohol, tobacco or firearms require the approval of the federal government. If you need a federal license, talk to an attorney about how to handle the application process.

  • 2. Permits

    Many businesses are also required to obtain permits that generally regulate the safety and appearance of an establishment, as defined by local and/or state laws. Remember, failing to obtain the proper permits may prevent your business from opening, and could result in fines or even being shut down. Many state business licenses and permits must be renewed annually. There are various permits you may need, including:

  • A seller's permit, if you'll be buying wholesale merchandise for resale.

  • A building permit. if you will remodel or construct a commercial space.

  • A health permit, if you'll be preparing food as part of your business. Health permits could be required by the state or the county, depending on where you live.

  • A zoning permit, showing your business site is properly zoned for the intended use.

  • A home occupation permit, if run your business from your house.

  • The Small Business Administration operates a Web site that will point you toward the proper state offices to begin the licensing and permit process.

    3. Environmental Business Regulations

    If your company deals with hazardous waste or has purchased a mold-infested warehouse, you will likely need to comply with Environmental Protection Agency regulations or risk litigation and hefty fines. The EPA has a Web site for small businesses that you should consult if there are environmental issues related to your business.

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