Do I Need a Business License if I Sell My Paintings?
Painting for a business is a different matter from painting for pleasure. Any business, even an artistic one, has to comply with local, state and federal laws. Depending which city and state you paint in, you may have to take out a business license to legally sell your work, as well as other related legal requirements.
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Considerations
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You must make a plan for your business before you can accurately determine what sort of licensing and registration will be required. If you're going to create a business name different from your own name, for instance, you'll have to register it with your local government, in addition to other licenses. The more organized you are in the planning stages, the better the chance you won't overlook important paperwork and incur penalties.
City, County and State Requirements
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Ask your local government what the requirements are for the business structure you have in mind. Many cities and counties, according to the Washington state arts group Artist Trust, require some sort of business license to operate. The cost of licensing may vary, depending on factors such as whether you have any employees or how much money you make. You may need a state license in addition to local requirements: In Washington, for example, you'll need one if selling your art brings in more than $12,000.
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Special Permits
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In addition to a business license, some cities require a special permit if you're working out of your home, attorney Stephen Drahos states on the Artists Register website. Some local governments don't allow home businesses at all, and some set restrictions on the percentage of your house you can devote to business or the number of customers who can visit per day. If the city doesn't think your painting business qualifies for a permit, you can apply for a variance -- a decision by a city board that you qualify as an exception -- to operate.
Taxes
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If you sell directly to individual customers, the Artist Trust states, you must charge sales tax. That means you also have to fill out paperwork with your state for collecting and submitting the taxes. If you sell to a gallery or agent who works as a middleman, however, you're not responsible for collecting the tax.
Warning
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Many home-business owners try to fly under the radar and run a home business without a license, writer George Rodriguez states on the Power Home Biz website. You might be tempted to do the same, but all it takes is a disgruntled neighbor or a city official checking the state sales-tax registry to discover what you're up to. Penalties incurred due to noncompliance usually aren't worth the risk of operating illegally. In Washoe County, Nevada, for instance, business owners caught operating without a license must purchase the license plus pay a fine equal to one year's licensing fees.
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References
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- Photo Credit painting image by Linda Brotkorb from Fotolia.com
