Do I need a business license?

[Zachary Early]

I live in Buchanan county Missouri, I am making my own indie games to sell online, would I need my own businesslicense? Please tell me where you got this information!

 

[bgillisp]

We wouldn't know this info fully, as only a lawyer could properly answer this for you. But from what I understand, in the US, you do need one.

 

[mlogan]

I've moved this thread to Commercial Discussions. Please be sure to post your threads in the correct forum next time. Thank you.

 

[Rukiri]

You will only need a license after a certain income threshold, but eventually you will unless you never meet the income threshold.

 

[Golden Unicorn Gaming]

I also think you need one, tho I'm in IL, not Missouri. Gotta report those earnings... I think the threshold is really small.

 

[esterk]

You'll need to do your research, because it varies from state to state. Where I am, I believe our threshold is $400 - after that, you need to report it on taxes. I'm not sure how selling games works, but in terms of doing freelance art (my field), you don't actually need a business license, you just need to report it as self-employed earnings (again, this is for my state and may not be for yours).

But again, do your research by going to your local government websites. I'm sure there are plenty FAQs and info for stuff like this. You may even be able to call to a local government office to get more info.

 

[ACECORP]

@Zachary Early If you plan to do this and you want to be fully legitimate, yes its good to register with your state's department of state as a single member business LLC (Limited Liability Corporation), and with the IRS as a "Disregarded Entity / Single Member LLC" and also register with your state's department of revenue. Those three things will get you an Federal EIN and a State Sales Tax License.

If you plan to go full speed ahead and are in it for the long term, its good to do that.

The total cost is "Free" for the Federal EIN and ~ $150 to $250 for the State Dept of State registration.

You need to check with your tax guy about the exact forms, but thats the general process.

You can also operate as a sole proprietor and register a fictitious name, but that won't get you the benefits of an LLC or a FEIN.

If you are a kid, just do the sole proprietor route with a fictitious name registration because the cost is almost nothing. My state charges $80 for a fictitious name registration. One of my businesses is a sole proprietorship and its fast and easy to do that.

If you want to register to use Apple's Developer program and sell your game in the app store, you also need to get a Dun and Bradstreet DNB #.

If you really plan to do this developer thing as your main form of income or as a permanent side gig, I recommend you do an LLC and file with your State's Dept of State. Then as you interact with other businesses and partner with companies such as video game distribution companies or tools companies, its so much faster and easier because you are an LLC and all that info is instantly obtainable during the various application processes.

Your income tax guy can give you the exact details as applicable to your state, and can tell you the exact forms and processes.

If you are serious about what you are doing, I recommend you go full legit.

Now if you don't register, your tax guy can still handle it as a sole proprietorship without a fictions name, so from what I understand going "full business" is not a legal requirement, because your tax guy can just handle any income as a "Sole Proprietorship without Fictitious Name Registration". But you don't get all the other benefits that come with LLC and State department registration if you stay "low key".

 

[Llareian]

Unless anyone here is a business lawyer or accountant in Buchanan County, Missouri, who can provide you their credentials, it would be foolish to take their advice on "do I need a license?" without doing further research. You really need to ask a lawyer, accountant, government office, or similar. The laws can vary by country, state, and even county. Your county clerk (or local equivalent) would probably be a reasonable place to start asking questions.

 

[Allan Bays]

If you are a sole proprietor under your real name you do not need to register in most states nor acquire any kind of licences, just do business. However you are 100% liable for absolutely everything.

This is the best way to start for most people and then move into a LLC when you can afford it, after you know your business is worth it.

Do check your own state's laws but this is the case in most of the country.

 

[Jesse - PVGames]

For what it's worth, I have been doing this for a few years and, at least in Massachusetts, I did not need any sort of license. I just needed to be sure to include all of my earnings on my taxes in a Section C (I think that is the form), which is where you input extra income.

 

[Wavelength]

My understanding is that you don't need one as long as you are self-employed, without official employees (independent contractors are OK), and work from home (or some other residence) rather than occupying commercial real estate, and run the company in your own name (otherwise you'll technically need a Doing Business As name, though I don't think this is usually a big deal).

I've reported thousands of dollars of as-of-yet-unrealized earned income on my taxes, with the expectation that those revenues will be realized upon my game's release. I have to file a few extra sections on the tax returns, but it seems to accept income I earn on my own (for my own business) as standard income, and does not require me to list a licensed business or anything of the like.

Don't take this as legal advice, of course. But in my own experience it has seemed that I don't need one, and I have not seen any red flags that would indicate I'm doing something wrong.

 

[Roninator2]

I have looked into this for my area. While I could not find any information saying I needed to have a license, it will only cost me $100 for the city and provincial licenses. So if I do need it (which I would talk with a city official at City Hall) then it's not a big cost. This is all assuming that I make a commercial game for sale.