How to Get a Business License in Texas

A crucial step in starting a limited liability company (LLC) in Texas is acquiring all the necessary licenses and permits. Depending on your business, you may need them at the federal, state, and local levels. 

You could face major penalties and even business closure without the proper licenses. This guide lays out all you need to know to ensure full compliance in Texas.

Which Department Issues Business Licenses and Permits?

In most states, several agencies and departments issue licenses and permits depending on industry and location. For example, in Texas, the Department of Licensing and Regulation issues most licenses, while the Texas Comptroller issues some. 

Federally, different departments oversee different industries. As a result, licenses and permits are generally industry-specific, except for health permits from the Occupational Safety and Health Administration (OSHA).

Your business may need a U.S. Department of Agriculture license if you run a farm. If your business sells fireworks, you must register with the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Most industries, however, are not required to be licensed at the federal level. 

The Small Business Association (SBA) has put together a handy guide that details which licenses and permits are needed for various types of businesses. 

Common Business Licenses and Permits

Here are some standard licenses and permits you may need.

Federal Licenses

If a federal agency regulates your industry, you’ll need a license from that agency. Federal agencies that may require licenses include:

• Department of Agriculture
• Alcohol and Tobacco Tax and Trade Bureau
• Bureau of Alcohol, Tobacco, Firearms, and Explosives
• Department of Transportation

State Licenses

Standard licenses at the state level include:

• Industry-specific licenses for certain professions and industries, such as construction, plumbing, electrical, childcare, food handling, liquor, architecture, and finance
• Health licenses and permits
• Doing business as (DBA) permits using a name other than your LLC.
• Sales tax permit

Local Licenses

At the municipal or county level, you may need the following:

• Building and zoning permits
• Health licenses and permits
• Fire permits
• Sign permits

How to Obtain a Business License in Texas

A general business license is not required in Texas, although other licenses are. 

1. Unless you’re operating as a sole proprietorship or partnership, you’ll need to register your business entity with the state, usually as an LLC or a corporation, through the Secretary of State. 
2. You’ll need to register for sales tax on the Comptroller’s website if you sell goods or services.
3. Other licenses require applications with specific departments. For example, you’ll need an electrician’s license if you run an electrical repair business in Texas. Professional licenses are available through the Department of Licensing and Regulation. 
4. Check with local governments for required licenses and permits at the local level. 

How Much Does a Business License Cost in Texas?

License and permit fees vary. A sales tax permit, for instance, costs nothing in Texas, while forming an LLC costs $300.

Do Licenses and Permits Have to Be Renewed?

Some licenses and permits need to be renewed annually. For example, a sales tax permit in Texas does not expire, but most professional and trade licenses need to be renewed annually. 

Check with the issuing departments for renewal requirements.

In Closing

Obtaining licenses and permits is a critical step when starting an LLC in Texas, so check with state and local government offices and fully comply with their requirements. If you operate without the proper licenses and permits, you could face steep fines or even the closure of your business. 

If you’re unsure of state or local regulations and need help, consult a business attorney, as proper licensing is an absolute must.