Mississippi Business License

For many people, starting a new enterprise in Mississippi is an exciting yet demanding task. Due to the absence of a one-size-fits-all business license, it’s up to the business owners themselves to identify which licenses and permits they’ll need from the many state, county, and even city-specific options.

In order to streamline the process of fulfilling your business’s licensing obligations, use this Mississippi business license article. Our goal is to simplify the complex business landscape, help you obtain the licenses you need, and get started as soon as possible.

Do I Need a Business License in Mississippi

In Mississippi, businesses are required to obtain various licenses and permits at the local, state, and federal levels. Here’s a general breakdown:

Type of Business

Below, we’ve detailed common ways in which your business type can dictate the licenses you’ll be required to obtain, as well as specific examples of these:

• Sales Tax Permits: If your business is located in Mississippi and will make retail sales, you’ll be required to register for a sales tax permit with the Department of Revenue; this will allow you to collect sales tax
• Professional Licenses: Your business may also need additional licenses if it offers specific professional services. This is because in Mississippi, like many other states, licenses are required for many professions, such as pharmacists, accountants, and veterinarians, among others
• Environmental Permits: Businesses involved in industries that have the potential to impact the environment are often required to obtain a license from The Department of Environmental Quality in order to operate legally

However, this is not the only factor influencing the exact combination of licenses you’ll need — the location of your business within Mississippi plays an important role as well.

Location

In this section, we’ve provided a succinct overview of the potential licenses and permits that your business may need due to local, state, and federal requirements:

• Local: At the local level, it’s common for individual counties and even cities to require additional licenses on top of any statewide requirements. As an example, all businesses based in the City of Jackson must obtain a local business license that is renewed each year
• State: At the state level, there are two main types of licenses Mississippi-based businesses will need — sales tax permits and professional licenses. While sales tax permits are required of any business making retail sales of goods and certain services, you’ll need to refer to the relevant Mississippi state licensing boards to confirm which (if any) professional licenses you need
• Federal: If your business operates within certain industries or does specific types of work, you might need a license from the federal government. These include the alcohol, aviation, firearms and explosives, radio and television broadcasting, and transportation industries, among others

Since the exact permits and licenses your business will need are entirely unique to your situation, you’ll have to conduct thorough research into your own local, state, and federal regulations to smoothly launch your business.

Alternatively, many entrepreneurs opt to leverage the expertise of third-party services to handle this on their behalf.

How to Get a Business License in Mississippi

In order to get your business license(s) in Mississippi, you will need to complete the following steps:

• Form Your Business
• Obtain an Employer Identification Number (EIN)
• Apply for the Required Licenses and Permits

Let’s take a look at each step in more detail below.

Step 1: Form Your Business

Before setting out to obtain a business license in Mississippi, it’s pivotal that you first choose an appropriate structure for your business. Sole proprietorships, general partnerships, and corporations are all common choices, however it’s often seen as the most advantageous for small businesses in Mississippi to register as a Limited Liability Company (LLC). Here are a few reasons for why:

• Limited Liability: Members are protected from personal liability for business debts, safeguarding personal assets
• Tax Benefits: LLCs typically enjoy a pass-through tax treatment, avoiding the double taxation that corporations are subjected to
• Management Flexibility: LLCs allow for flexibility in management structure, either being member-managed or manager-managed based on the preferences outlined in the certificate of formation
• Ease of Formation: With the Business Services Division of the Mississippi Secretary of State providing forms that meet the minimum state law requirements and the option to file online, setting up an LLC is relatively straightforward

Many small business owners opt to avoid the tricky process of forming an LLC by instead leveraging the help of third-party LLC formation services.

Step 2: Obtain an EIN

The second step you’ll need to complete before applying for your business license is to obtain your EIN. This is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to businesses in the United States so that their financial transactions can be identified and tracked.

An EIN is often necessitated when applying for various permits and licenses as it allows local and state governments to ensure your business is operating within the confines of the law. You can obtain it in a number of ways:

• Online: You can apply for your EIN on the IRS’s official website by using the EIN Assistant. You should be granted your EIN shortly after completing this application
• By Fax/Mail: After completing Form SS-4, you can apply for an EIN by submitting it to the IRS via mail or fax
• By Phone: International applicants and businesses located outside US Territories are required to call the IRS at (267) 941-1099 to obtain their EIN — which they should receive during this call

Note: If you are a sole proprietor, you will be able to use your Social Security Number (SSN) instead (as long as you do not have employees).

Step 3: Apply for Licenses and Permits

After settling on the appropriate structure for your business and initiating the application for your EIN, the next step is to focus on securing the necessary licenses and permits to operate legally within your locale and industry.

• Local Licenses: Depending on the nature of your business, your local government may require licenses that are specific to your county or city. Checking with your local city and county clerks is a good starting point to figure out which specific licenses your business may need
• Statewide Licenses: Almost all businesses operating in Mississippi will need to obtain a sales tax license from the Mississippi Department of Revenue. In addition to this, you may also require certain specific licenses depending on the nature of your business. For example, any retail food facility is required to obtain a permit from the Mississippi Department of Health
• Federal Licenses: While the federal government doesn’t mandate licenses for general business operations, if your business falls under any government-regulated category, such as agriculture, fishing, firearms, and alcohol sales, it may be required to obtain additional federal licenses or permits

Note: For more detailed information on the licenses your business could need, be sure to check out the Mississippi Small Business Development Center website.

Step 4: Renewal of Licenses and Permits

Many Mississippi business licenses must be renewed periodically every few years in order to keep them valid. However, the exact renewal period and process will vary with each individual license, so it’s best to reach out to the agency that issued your business license for clarification.

Alternatively, third-party services that handle this entire process are becoming an increasingly popular option. Using these services avoids the need for you to undertake this licensing research for your own business.

How Much is a Business License in Mississippi

The total cost of your business licenses in Mississippi will ultimately depend on the exact combination of licenses and permits that you need. While there’s no cost to obtain a sales tax permit, there are other local, state, and federal licenses your business may require that vary in cost.

To ascertain the exact costs, you need to conduct detailed research into your particular business type and the region in which you plan to operate. As an example, permit fees for alcoholic beverages vary between $35 to $9,025 based on a number of factors, including the business’s specialty, whether it’s temporary or permanent, and the type of beverages being sold.

Many business owners opt to save both time and money by employing a third-party service to perform this research on their behalf.