A business license is a formal permission granted by a government authority that allows an individual or company to operate within a specific jurisdiction. It serves as an official verification that the business has met the necessary legal and regulatory requirements to trade legally. Verifying a company’s licensing status is a foundational step for consumer protection, as it confirms compliance with laws, safety standards, and tax obligations.
Required Information to Start Your Search
Starting the verification process requires obtaining specific, accurate details about the entity you are researching, as minor errors can lead to failed searches. The most important piece of information is the business’s full, legal registered name, which is often distinct from the brand name or “Doing Business As” (DBA) name that a company uses in marketing. Searching only by the common brand name may not yield results in official government registries.
You should also secure the business’s physical street address, as many license databases allow searching by location to narrow down results. If available, obtaining the name of the principal owner or the registered agent can be highly beneficial for confirming identity in certain state or local databases. Having the company’s official license number will expedite the search considerably, but it is not always necessary.
Checking State-Level Registration
The first major step in confirming a business’s legality is checking its general registration at the state level, which verifies its legal existence as an entity. This information is typically maintained by the state’s Secretary of State or a similar governmental office responsible for corporate filings. Every state provides an online corporate registry or business entity search tool that allows the public to verify if an organization is legally registered to transact business within that state.
Searching this database confirms the business structure, whether it is an LLC, Corporation, Partnership, or other formal entity. The registry will also show the company’s status, with the most desirable status being “Good Standing” or “Active,” meaning the entity has filed its required annual reports and paid its state fees. A status that indicates “Revoked,” “Suspended,” or “Forfeited” is a major warning sign that the business is not currently authorized to operate its entity type in the state.
It is important to understand that this general state registration confirms only the administrative status and legal right to exist as a company. It does not certify the professional competency of the business or its employees, nor does it confirm compliance with local zoning or specialized industry requirements. This initial check establishes only the foundational legality of the business’s structure before moving to more specific licensing verifications.
Locating Specific Occupational and Industry Licenses
Beyond general state registration, many professions and industries require specific occupational licenses or certifications to ensure public safety and competence. These specialized credentials are often overseen by dedicated state professional boards, which operate separate verification portals from the Secretary of State’s general business registry. Examples of regulated professions include real estate brokers, accountants, engineers, and medical practitioners.
To locate these, one must search the websites of the relevant state board, such as the Board of Accountancy, the Medical Board, or the Department of Business and Professional Regulation. Many states consolidate these searches into a single online system, allowing users to look up a licensee by name, license number, or profession. The resulting profile will detail the scope of the license, its expiration date, and any disciplinary actions taken against the licensee.
For businesses operating in highly regulated fields like interstate transportation, alcohol sales, or firearms, federal licensing requirements may also apply. Verification for these instances requires consulting the websites of the specific federal agency, such as the Alcohol and Tobacco Tax and Trade Bureau (TTB). Searching these specialized databases is necessary because a business can be a legally registered corporation but still lack the required certification to perform its specialized service legally.
Verifying Local Permits and Operations
The final layer of licensing verification occurs at the hyper-local level, involving city and county governments, which issue permits related to physical operations, safety, and local taxes. These local licenses are distinct from state registration and often relate to the business’s physical location. Necessary local permits can include health permits for food service establishments, fire safety permits, zoning compliance certificates, and general local business tax receipts.
To check these, you generally need to consult the City Clerk’s office, the County Recorder, or the local Department of Health or Revenue in the municipality where the business physically operates. Many municipalities provide an online directory or searchable database for permits and licenses. A business can possess a valid state corporation status and professional license but still be operating illegally if it lacks a required local permit, such as a health or occupancy permit for its specific location.
Local jurisdictions often have unique licensing requirements for activities such as soliciting, vending, or operating specialized facilities like bowling centers or amusement arcades. Confirming these local permits ensures the business is complying with the day-to-day operational rules of the community.
Deciphering the Search Results
Once you have conducted searches across state and local databases, interpreting the returned information is important for a complete picture of the business’s standing. You must look closely at the license status, which will typically be listed as “Active,” “Current,” “Expired,” “Suspended,” or “Revoked”. An “Active” or “Current” status indicates compliance, while any other status, particularly “Suspended” or “Revoked,” is a serious red flag that the business is not authorized to operate.
The expiration date is another detail that requires close attention, as a license might be technically “Active” but due to expire in the coming days or weeks. It is also important to verify the scope of the license to ensure it covers the specific services the business is offering. For example, a contractor’s license might be valid for residential work but not for the commercial project you are researching.
What to Do If a License Cannot Be Found
If a thorough search of all relevant state and local databases yields no results, the first action should be to contact the appropriate regulatory agency directly for manual verification. Licensing boards often maintain records that are not immediately accessible through public online portals, and a staff member can perform a more detailed search. If the business refuses to provide its legal name or license number, or if the provided license appears expired or revoked, these are significant warning signs.
In cases where a business appears illegitimate or is operating without the necessary permissions, the consumer should seek recourse through external agencies.
Reporting an Unlicensed Business
- File a complaint with the state’s Attorney General’s office.
- Contact the state’s Department of Consumer Affairs or a local consumer protection agency.
- Report the business to the Better Business Bureau (BBB).
- Notify the specific professional licensing board to initiate a formal investigation.