Do I Need a License to Sell Online in the US?

Selling products online can be a smart way to grow a business, but it comes with responsibilities. One key requirement? Making sure you’re licensed to sell online in the US. From business licenses to tax registrations, there are a few compliance steps you can’t skip. For US online sellers, this is where understanding your obligations—and having support like accounting services in the US—can make things much easier.

Whether you’re just getting started or scaling fast, here’s what you need to know about licensing.

Do US Online Sellers Need a License?

Yes, in most cases, US online sellers are required to have some type of license or permit to legally operate. The specific requirements vary depending on the nature of your business, where you’re located, and what you’re selling.

Let’s explore the most common licensing and permit requirements.

1. General Business License

Most states and cities require businesses—whether physical or online—to have a general business license. This shows that you’re authorized to operate in your location and are registered with your local government. You’ll typically obtain this from your city or county clerk’s office.

Note: Even if your business is home-based, you’re still likely to need a general business license.

2. Sales Tax Permit (or Seller’s Permit)

If you sell taxable goods or services, you usually need to collect and remit sales tax. To do that, you must register for a sales tax permit in each state where you have a tax nexus—a connection such as physical presence, employees, or significant sales volume.

Each state has its own process, but you can typically apply through the state’s department of revenue.

3. Home Occupation Permit

Many US online sellers start their business from home. If that’s you, your local zoning laws may require a home occupation permit. This ensures your home-based business complies with local regulations and doesn’t disrupt residential neighborhoods.

✅ Counto’s all-inclusive accounting plans for online sellers feature multicurrency support, unlimited transactions, GST submissions, and tax filing—with no hidden fees. Benefit from a dedicated team of experts, including a bookkeeper, Chartered Accountant, and tax specialist. Optimise your e-commerce finances today.

4. Industry-Specific Licenses

If you’re selling regulated goods—like food, alcohol, tobacco, health products, firearms, or supplements—you may need additional federal, state, or local permits. For example, food sellers might need clearance from the FDA or local health departments.

Note: Check with the appropriate agency in your state for industry-specific requirements.

5. Federal Licenses

Most ecommerce businesses don’t need a federal license. But if you’re involved in certain activities like broadcasting, drug manufacturing, or preparing meat products, federal licensing may be required.

6. Business Entity Registration and EIN

Before applying for licenses, you’ll need to register your business entity with your state. This might be as a sole proprietorship, LLC, or corporation. Most sellers also need an Employer Identification Number (EIN) from the IRS. Even if you don’t have employees, an EIN is useful for tax filings and opening a business bank account.

7. Multiple States, Multiple Requirements

If you sell in more than one state or store inventory in different locations, you may need licenses and sales tax permits in multiple jurisdictions. That includes marketplaces that store and ship inventory on your behalf.

Note: Each state has its own rules, so staying informed is key to compliance.

Summary

Getting a license to sell online in the US is more than just a formality—it’s a legal requirement for most ecommerce businesses. US online sellers must secure the right permits, including a general business license, a sales tax permit, and possibly a home occupation license depending on where they operate. Additional licenses may be necessary for selling regulated goods or doing business across multiple states.

Experience the Counto advantage

Counto is the trusted outsourced provider of accounting, tax preparation and CFO services for SMEs and ecommerce businesses. Get accounting plans that combine bookkeeping with corporate tax filing to help you stay compliant at an affordable price. To learn more, speak to us directly on our chatbot, email [email protected], or use our contact form. to get started.