6+ Licenses and Permits You May Need to Open a Resale Store

Are you an aspiring entrepreneur with a passion for thrift and a keen eye for hidden treasures? If the idea of owning a resale store excites you, then you're in the right place! However, before you can dive into the world of second-hand goods, there are some crucial legal aspects to consider. Opening a resale store, like any other business venture, requires obtaining specific licenses and permits to ensure you operate legally and smoothly. Navigating the maze of paperwork and regulations can be overwhelming, but don't worry - we've got you covered. In this article, we will explore six essential licenses and permits you may need to open a resale store, ensuring you have a solid foundation to build your dream business upon. So, let's get started on your journey to becoming a successful resale store owner!

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Written by:
Updated on:
April 17, 2023
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Table of Contents:

Our List of 6+ Licenses and Permits You May Need to Open a Resale Store:

Below is a list of possible Resale Store licenses and permits needed. Please note it will vary state by state, so please do extensive research before starting.

1. Business License.

A Business License is a legal document that grants permission to an individual or company to conduct business in a specific location. It is required by law in most jurisdictions and is necessary for tax purposes, to comply with local regulations, and to protect the public interest. You might need a Business License to start a Resale Store because it is a commercial enterprise that involves buying and selling goods. Depending on the location of your store, you may need to obtain a local business license, a state business license, or both. Failure to obtain the necessary licenses can result in fines, legal penalties, and the closure of your business. Additionally, having a Business License can help establish your credibility as a legitimate business and provide protection from liability.

Check if your state requires a Business License.

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2. Sales Tax Permit.

A Sales Tax Permit, also known as a Seller's Permit or Resale Permit, is a document that allows a business to collect and remit sales tax to the state government. In the case of a Resale Store, a Sales Tax Permit is required because the store will be selling merchandise that has already been taxed by the manufacturer or distributor. By obtaining a Sales Tax Permit, the Resale Store can avoid paying sales tax on their own purchases and instead collect it from their customers. Failure to obtain a Sales Tax Permit can result in fines and legal penalties.

Check if your state requires a Sales Tax Permit.

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3. Employer Identification Number (EIN).

An Employer Identification Number (EIN) is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to identify a business entity for tax purposes. You might need an EIN to start a resale store if you plan to hire employees, open a business bank account, or file tax returns. Additionally, some wholesalers and suppliers may require an EIN to sell products to your store.

Check if your state requires a Employer Identification Number (EIN).

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4. Resale Certificate.

A Resale Certificate is a document that allows a business to purchase goods without paying sales tax. This certificate is issued by the state government and is used by businesses that intend to resell the purchased goods. If you are starting a resale store, you will need a Resale Certificate to purchase inventory from wholesalers or other suppliers without paying sales tax. This is because the sales tax will be collected from the end consumer when they purchase the item from your store. Without a Resale Certificate, you would be required to pay sales tax on the items you purchase, which would increase your costs and reduce your profits.

Check if your state requires a Resale Certificate.

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5. Certificate of Occupancy.

A Certificate of Occupancy (CO) is a legal document issued by a local government agency or building department that certifies a building's compliance with building codes and other regulations. It verifies that the building is safe and suitable for occupancy.To start a resale store, you may need a CO to ensure that the building you are using meets all the necessary safety and zoning requirements for commercial use. This certificate is usually required before you can open your store and begin operating legally. It may also be necessary to obtain a CO before you can obtain necessary permits, licenses, and insurance policies.

Check if your state requires a Certificate of Occupancy.

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6. Signage Permit.

A Signage Permit is a legal authorization granted by the local government to install and display signs on a property. It ensures that the signs comply with the zoning and safety regulations of the area.You might need a Signage Permit to start a Resale Store because you need to advertise your business and attract customers. The permit allows you to install signs that are visible to the public and comply with the local regulations. Without a Signage Permit, you may be fined or forced to remove the signs, which can negatively impact your business.

Check if your state requires a Signage Permit.

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This post is for information only. You are responsible for reviewing and using this information appropriately. This content doesn’t contain and isn’t meant to provide legal, tax, or business advice. Requirements are updated frequently and you should make sure to do your own research and reach out to professional legal, tax and business advisers, as needed. We’re reader-supported. When you buy through links on our site, we may earn an affiliate commission.

Frequently asked questions

Everything you need to know about the business licenses.

What is the best business formation license for a Resale Store?

The best business formation license for a resale store would likely be a Limited Liability Company (LLC) or a Sole Proprietorship, depending on your specific needs and circumstances. An LLC provides limited liability protection, which means your personal assets are protected from the debts and liabilities of the business. It also offers flexibility in terms of management and taxation. Additionally, an LLC is relatively easy and affordable to set up. A Sole Proprietorship is the simplest business structure and may be suitable if you are the sole owner and operator of the resale store. It is easy to set up and has fewer ongoing compliance requirements. However, it does not provide limited liability protection, meaning your personal assets could be at risk if the business faces any debts or liabilities. It is recommended to consult with a legal or financial advisor to determine the best business structure for your specific situation.

Is it required to have a general business license for a Resale Store?

Requirements for a general business license may vary depending on your location and local regulations. It is advisable to check with your local government or city office to determine the specific requirements for opening a resale store in your area.
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I'm Nick, co-founder of newfoundr.com, dedicated to helping aspiring entrepreneurs succeed. As a small business owner with over five years of experience, I have garnered valuable knowledge and insights across a diverse range of industries. My passion for entrepreneurship drives me to share my expertise with aspiring entrepreneurs, empowering them to turn their business dreams into reality.

Through meticulous research and firsthand experience, I uncover the essential steps, software, tools, and costs associated with launching and maintaining a successful business. By demystifying the complexities of entrepreneurship, I provide the guidance and support needed for others to embark on their journey with confidence.

From assessing market viability and formulating business plans to selecting the right technology and navigating the financial landscape, I am dedicated to helping fellow entrepreneurs overcome challenges and unlock their full potential. As a steadfast advocate for small business success, my mission is to pave the way for a new generation of innovative and driven entrepreneurs who are ready to make their mark on the world.