How to Get an Iowa Business License

Do you need a business license in Iowa?

Unlike many other states, Iowa has no general business license requirement at the state or local level. However, you will still need to register your business with your county recorder or city clerk’s office and apply for business-specific licenses and permits. These may include:

• Sales and use tax permits, if you plan to collect sales tax. Sales tax permits can be obtained from the Iowa Department of Revenue. You may also need this permit if you own an online business out of state, but make a certain amount of revenue through sales in Iowa State.
• Building permits, if you’re planning to build a new structure or alter an existing one for your business. Building permit requirements can vary by county.
• Professional licenses, if you practice an occupation that necessitates a special license. Doctors, accountants, plumbers, real estate agents, and barbers are just a few examples of professionals who may need these types of licenses.
• Industry-specific licenses and permits, for business sectors that are regulated by the state or federal government. If you own a business that sells alcoholic beverages, for example, you may need a state liquor license, as well as a federal license from the Alcohol and Tobacco Tax Trade Bureau.

How to get an Iowa business license, step by step

Determining which specific business licenses you’ll need to operate in Iowa is a relatively simple process. However, there are a few steps you’ll need to take before you even get to that stage in your business development process. Here’s a general overview of what you’ll need to do to start the process of obtaining your business license.

Step 1: Choose a business name and entity type

Before you begin applying for business licenses, you’ll need to decide what type of business entity (corporation, limited liability company, etc.) you intend to open. This information will be required when you register your business in the state of Iowa.

You’ll also want to check that your intended business name is available and reserve the right to use it. To complete this step, perform a business entity search on the Iowa Secretary of State website. If your desired name is available, you can reserve it for up to 120 days by filing a registration of name application.

Step 2: Register your business

The next step before applying for your required licenses is to register your business with the state. The registration process in Iowa differs by entity type.

Limited liability companies (LLCs) in Iowa register by filing a certificate of organization via the Iowa Secretary of State’s Fast Track Filing system.

Corporations register by filling out articles of incorporation with the Secretary of State.

Sole proprietorships and general partnerships register by filing a trade name form at the local county recorder’s office. Sole proprietorships that use the business owner's name as part of the business name are not required to register in Iowa.

You might also choose to file for an employer identification number (EIN)—which is used for tax reporting purposes—at this stage. While it’s not required for all business types, you may need this number if you plan to file for certain other permits, such as a tax permit.

Step 3: Perform a business license search

There are more than 450 different industry-specific Iowa licenses. To determine which you might need for your business, you can use resources provided by the Iowa Economic Development Authority (IEDA) website. Or, you can consider using LegalZoom’s business license service, which will create a customized list of all the local licenses you need in Iowa, according to your business activities.

Step 4: Apply for your licenses and permits

Once you have your list of required licenses and permits, fill out the applications and file them with the correct regulatory department or agency by the due date. In many cases, you’ll be able to see an estimated processing time for each business license result you generate through your license search. 

It’s always a good idea to check with your city clerk’s office to double-check that you have all the licenses or permits you need to conduct business in your area.

What to do after getting your Iowa business license

What you do after you get your Iowa business licenses is largely determined by the type of license or licenses you have. Some licenses, such as sales tax permits, may need to be visibly displayed in your place of business. Others, like professional licenses and certain federal licenses, may need to be renewed at a regular cadence.

Keeping track of renewal requirements for multiple licenses can be time consuming and stressful. LegalZoom's can make it easier by tracking your licenses and sending you helpful reminders when it's time to renew.

FAQs

What should I do before getting an Iowa business license? 

Before you even start thinking about getting an Iowa business license, you'll need to make important decisions about your business, such as whether you plan to file as a corporation, LLC, sole proprietorship, or other entity, and what your business name will be. You'll also need to register your business with the correct state or county department.

But as you're in the development stages, you may start to get a general idea of the licenses or permits you may need to get later on. If you know what area you plan to open your business in, for example, you can research local zoning laws to see if your business activities will necessitate a special zoning permit. Keeping a running list of the various permits and licenses you could need may help make the process feel less daunting later.

How much is an Iowa business license?

Fees for business licenses in Iowa vary by license type and certain licenses and permits may not have a fee at all. Generally speaking, you can expect to pay somewhere between $50 and a few hundred dollars, depending on license type.

How long does it take to get a business license in Iowa?

Just as the filing fees for business licenses vary by license type, so too will the time it takes to receive your license after submitting your application and permit. In many cases, you’ll be able to see an estimated processing time for each business license result you generate through your license search. 

Some Iowa licenses and permits may take as long as 30 days to process, while others may be available immediately. Sales tax permits, for example, are valid the same day you register with the Iowa Department of Revenue. This allows you to collect sales tax immediately, though it can take up to 6 weeks to receive your actual letter.