BUSINESS SPOTLIGHT: Licensing and Permit Requirements for Starting an Online Business
By Space Coast Daily // May 21, 2018
There are usually license requirements whenever you start any kind of business, it doesn’t matter whether you decide to have a brick and mortar storefront or do business online. Licenses, permits, and tax collection may all be required depending on your jurisdiction and business structure. Here are some things to keep in mind for online businesses:
Common Permit Requirements for Online Businesses
After you have determined what kind of business you want to be in and where you wish to operate, there are a number of things you will need to do before hanging out your shingle.
- Decide what form your business will take. Will it be a sole proprietorship, partnership or LLC?
- Register your business according to the laws of your state.
- Register with your state to collect sales tax on any sales that you make within your home state.
- Check local zoning laws to see if there are any permits you need for your business. Are there are any prohibitions with, city, county, or homeowner’s association regarding being able to conduct business out of your home? A quick call to your area chamber of commerce can answer your questions and direct you according to where your business will be located.
- If you have inventory or equipment, be sure talk to an insurance agent to carry insurance for both the inventory and your business-related equipment.
Licensing for an Online Store
When you are operating a store online, unless you are offering products that require a license such as medical devices, healthcare services and products, or gaming, you do not require a special license. If you are selling items you have made or reselling products that don’t fall into those categories, all you need is to ensure that you follow local ordinances and the guidelines for tax collection and remittance.
The Types of Licenses You May Need for Your Gambling Business
If you have your eye on setting up an online casino or bingo games site, you will also need to apply for a gaming license in your state. All 50 states require this for any type of gambling business, whether you are offering Blackjack or Bingo. This step will require you to research what your state requires. Some states are very stringent and have a long list of requirements so that visitors to your site are assured of fair gameplay and that any taxes are being accurately reported and collected for both the federal and state governments.
Video Game Licensing
Assuming that you have acquired the necessary gaming licenses for your state, there are a number of different types of video game licensing. An example of this would be for casino type games or online bingo. Most video game licensing involves an in-licensing in which a licensor of gaming software grants a licensee the ability to offer or even develop video or online games according to the guidelines within the agreement.
Rules surrounding intellectual and creative property are rather complex. It is a good idea to discuss this aspect of your business with an attorney who specializes in this area of law. If you plan to offer video streaming of licensed films or movies, you will need to have a license for their distribution. Most of these will require a standard film licensing agreement.
Similar to film licensing, music licensing also require certain licensing for streaming or download in order to protect the intellectual property rights of artists and producers and make sure that they receive royalties from their work. Most artists, recording companies, and producers will require a standard music licensing agreement before their content is used. Sites such as Bandcamp or Soundcloud offer a centralized hub where users can stream or download content.
Other notable games of chance include online bingo, that’s been a favorite pastime for both women and men of all ages. The low cost required to play at some of the new bingo sites makes it a very interesting proposition especially for those who are looking to learn how to play online and avoid some of the common mistakes that are made by rookie players who join the more advanced casino websites. This is a great way to get to grips with the online environment that happens to be more complex than when visiting a land-based hall.
If you have questions about what kind of permits or license you need for your successful online business, speak with a business lawyer or your local Small Business Administration for guidance. Make sure to check the credibility of the lawyer before striking the deal.
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