On the matter of business permits

It’s tax time soon, and my friends and I have been wondering about our untaxed income from freelancing. It’s been a whole lot of confusion for us. We had teachers who told us we needed a whole slew of things, and business friends who said we didn’t need any of it.

A couple of weeks ago, I did some research, and ended up officially getting a business license. I’m still leaps and bounds before I’m well read in this matter, but I thought I would post here what I did for reference. (And spare myself from repeating this too many times.) Here we go…

Getting a business permit:

I’m using ‘business permit’ and ‘business license’ interchangeably. As I understand it, the two refer to the same thing, which is a little piece of paper that tells the government you have freelance income that hasn’t had its tax taken out.

Since I am a freelancer in California, I needed one. I am writing this with the assumption that you, too, are a freelancer in the city of Los Angeles. For other cities, it should be a similar, albeit slightly different, process.

1. Go to the CalGOLD website, and type in ‘graphic design.’ Then, in the next page, select your county and city. This will bring you a list of contact information for a lot of different licensing. I’m a work-at-home freelancer, so I only needed the permit, not the police or fire stuff.
2. For the city of LA, in LA county, CalGOLD told me to see the Office of Finance.
3. At the OoF’s Forms & Publications page, download the Business License application form, as well as their NAICS Codes list. The list is a bunch of numeric codes that tells the city what type of business you are doing. You’ll need one when you fill out the application.
4. Fill out the application, bring your check book, and head to the nearest OoF branch. A complete list of branch offices and hours are on the last page of theBusiness Tax Information Booklet.
5. Two nice ladies at the OoF told me how much I owed (you are suppposed to get a permit within 30 days of starting your business, so I had to pay extra), gave me a temporary permit, and told me to wait for the real thing in the mail.

It was simple as that!

Please note, however, that I didn’t get a DBA or a reseller’s permit. I’m doing business as my own name, so no DBA was needed there. So far, I am only delivering digital files (as opposed to handing over physical, printed goods), so I didn’t need a reseller’s license to to collect sales tax from clients and make tax-free purchases.

Best of luck to your business endeavors, and please remember that this is only a guide, and I am no expert.