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Do You Need A Business License To Sell Your Art?

Do You Need A Business License To Sell Your Art?

For artists who are looking to embrace their talents as a source of income, a popular question is “do i need a license to sell my art online?”. If you want to sell your art, you might be wondering what you need to do to make it legal.

When it comes to selling art in movies, people generally don’t discuss licensing.

Some people take this as a hint that it isn’t necessary, and others start researching.

The general consensus is that in most cases you do need a business license to sell your art.

A business license is a local requirement that basically enables you to sell something. It is necessary if you want to collect taxes or for remaining in compliance with your business.

You probably have very little interest in having your art business shut down by government officials.

With this in mind, it is important to know when you actually need a license to sell your products.

Fortunately, we have provided a comprehensive breakdown below.

Please keep in mind that you might need additional permits depending on your business, so consult your local officials.

If you’re interested in other business articles regarding your art, check out my other related content:

do artists need to register as a business

Selling Art Locally and Licensing

do you need a license to sell art - licensing

If you plan to sell your art in any kind of personal capacity, you will need a license.

Business licenses are important here because they help you to legally sell your products. A major distinguishing difference in sales is who you are selling to.

If you are going to be selling to a customer directly, you will want to make sure that you have the legal right to do so.

When it comes to direct sales, you are expected to have to license in order to make it legal.

This is your way of telling the government that you are actively selling products and taxing accordingly.

If you are planning on selling artwork locally, there are other options to consider.

You will absolutely need a business license to sell your art locally, but that might not be enough in some cases.

If you intend to have a true brick-and-mortar store, you will likely need additional licensing.

Running a physical location can add requirements on a local level that you will need to adhere to. This means that you will need to do additional research.

Selling Art To Businesses and Licensing

art gallery

In the event that you decide to take a different sales approach, you might not need to worry about that business license.

While a license is undoubtedly necessary for selling directly to a consumer, indirect sales do not require this.

You can easily sell to another business or something like an art gallery without needing a business license. This might seem a little odd because it definitely is.

However, the laws change when the person you’re selling to is also in sales.

Selling your art to a non-individual entity changes things completely.

At that point, you’re becoming more of a provider of items than an actually salesperson. Wholesale is a completely different game in the eyes of the government.

Since you’re not actually selling to a consumer, you’re responsible for a lot less.

Overall, selling to an entity over a person makes the government have a lot less interest in you in most cases.

If you plan on selling your art in large quantities to another company that will sell them in your place, you’re free.

A business license might be necessary, but other permits won’t be.

Common Questions People Have When Selling Art

do you need a license to sell art - common questions

A common question people have when planning to sell art is built around galleries.

For artists, art galleries have a tendency to be the goal. When most artists grow up thinking about what their life will look like as an artist, a fancy gallery is involved.

In the modern age, there are galleries of all shapes and sizes.

When you sell your art to a gallery, you’re not dependent on a business license to do so.

This is because you actually retain ownership until they sell it for you.

In the same way that a wholesale client is not considered a consumer, neither is a gallery.

This is because the gallery is only purchasing for the sake of selling it.

Art galleries sell art and they need good art to do so.

They will purchase from or make an agreement with you for this reason.

If they bring in good art, they can expect more sales.

Unless they plan to buy it and not put it on sale, you don’t need a license for this process in some cases.

Do you Need a Business License to Sell Art Online

saatchi art

A prominent way of selling your art nowadays is online.

This might involve commissions, prints, or other art types.

Many artists use this to reach a larger audience and offer exciting products.

In fact, many artists opt for selling merchandise with their artwork on it.

If you’re going to be taking these kinds of approaches, you will need a business license.

Getting a license shows that you intend to remain in compliance and adhere to business laws.

A common focus for this is taxes. The site that you use will likely charge taxes for you, but you still have to agree to charge them. This can change depending on the sales tax laws in each state.

Another aspect to consider is how the site you are using actually works.

If you run your own eCommerce store on a standalone platform, you might have different requirements.

Since this is a lot more like selling directly, you will need a business license to carry it out.

This is the digital equivalent of having your own store.

Popular websites for selling art can actually change this process.

While selling art somewhere like Fiverr is going to be the same as your own site, some sites change.

There are sites that operate in more of a wholesale capacity where you sell your art and they sell it.

In this case, there are likely going to be different regulations when it comes to sales.

You might need additional licensing or no licensing at all.

Since you’re selling the product to be sold, the water can get murky.

These sites also likely have their own ways of navigating taxes.

Do you Need a Business License to Sell on Etsy

etsy

Anyone can setup up an Etsy. You don’t need a license to set it up. 

If you are making money when you start selling, you are considered a sole proprietorship in the USA.

When you’re starting out, you don’t need to file for tax forms under this business type. 

Here are the Etsy guidelines recommends when considering if your Etsy shop is a business or a hobby:

  • If you don’t intend to make a profit with your shop, then it may be a hobby
  • If you consistently dedicate time to your shop and you intend to make a profit, then your Etsy shop is considered a business. 

Local Taxes

You might also be responsible for local taxes depending on what you’re selling and where you are selling it. 

The best thing to do is to check your local laws to see what the requirements are. 

Etsy collects taxes in the following states

While Etsy does collect taxes in many states, there are some that do not. Below is a chart of the states they do collect taxes. The most up-to-date information on this can be viewed on Etsy’s website

StateDate
WashingtonJanuary 1, 2018
PennsylvaniaApril 1, 2018
OklahomaAugust 1, 2018
MinnesotaOctober 1, 2018
IowaFebruary 1, 2019
ConnecticutFebruary 1, 2019
South CarolinaFebruary 1, 2019
South DakotaMarch 1, 2019
New JerseyApril 1, 2019
District of ColumbiaApril 1, 2019
New YorkJune 1, 2019
IdahoJune 1, 2019
NebraskaJune 1, 2019
AlabamaJuly 1, 2019
ArkansasJuly 1, 2019
KentuckyJuly 1, 2019
New MexicoJuly 1, 2019
Rhode IslandJuly 1, 2019
VirginiaJuly 1, 2019
West VirginiaJuly 1, 2019
WyomingJuly 1, 2019
VermontJuly 1, 2019
IndianaJuly 1, 2019
OhioSeptember 1, 2019
ArizonaOctober 1, 2019
CaliforniaOctober 1, 2019
MaineOctober 1, 2019
MassachusettsOctober 1, 2019
North DakotaOctober 1, 2019
TexasOctober 1, 2019
UtahOctober 1, 2019
WisconsinOctober 1, 2019
ColoradoOctober 1, 2019
MarylandOctober 1, 2019
NevadaOctober 1, 2019
HawaiiJanuary 1, 2020
IllinoisJanuary 1, 2020
MichiganJanuary 1, 2020
North CarolinaFebruary 1, 2020
GeorgiaApril 1, 2020
LouisianaJuly 1, 2020
MississippiJuly 1, 2020
TennesseeOctober 1, 2020
Puerto RicoApril 1, 2021
FloridaJuly 1, 2021
KansasJuly 1, 2021

While you don’t need a license, an LLC, or official paperwork to set up an Etsy shop, you should do your own research to find out the requirements for your area. 

If your Etsy shop is making a profit then it is a safe and good idea to have a license.

Why Do You Need a License to Sell Art

girl thinking

A business license is in most cases a government requirement.

This means that failing to get one and still selling items could be illegal.

While it is unlikely that you will be arrested for this, you can be charged or fined.

This is less than ideal for most people, so it is best to avoid it.

Having a business license is a great way to dodge unwelcome fees.

Business licenses also protect your right to operate and do your work.

This can help you when it comes to certain legal protections.

There are different options when it comes to licensing, so you will have to choose what is right for you.

The options that you choose can come with different degrees of legal protection.

While this might sound unnecessary, it is important. In this day and age, people get sued all the time.

Knowing your rights is crucial.

As a general fact, business licenses exist as a way of keeping everyone accountable.

It is your way of showing the government that you are running a legitimate business.

Failing to do this can result in all kinds of penalties.

If you run a quick online search, you will see horror stories about people being fined for not having a license.

In the same way, you’re not supposed to sell random products on the street, you’re not allowed to in general.

Even a picture online needs to be accounted for by society.

What Kind Of Business License You Need To Sell Your Art

license types

Depending on your business model, you might need different kinds of business licenses. Selling your art is not a uniform process.

Many people do it differently, which is why different licenses exist.

The way that you register your business with the state can help you to meet your business needs. Everyone has their own needs and requirements for protection.

You can review the options and choose what is right for you.

Sole Proprietorship

do you need a license to sell art - sole proprietorship

For a simple business model run by a singular person, this can be a great option.

It is the equivalent of registering yourself as a standalone business.

It is the easiest way to let the government know that you are in business without much else.

The requirements for it are minimal and it can cover most artists depending on their business model.

This is your way of announcing to the government that you are doing business.

However, it means that you also acknowledge that you and the business are one.

This comes with some risks, but can be fine in most cases.

LLC

do you need a license to sell art - llc

An LLC is a slightly more complicated version of a sole proprietorship.

This makes your business a separate entity from you, which has some serious benefits.

The biggest reason that people take this route is to focus on protection.

The legal benefit to LLC’s is that you are covered if someone sues you.

When someone sues you as a sole proprietor, they are suing you specifically.

This means that your personal assets can be dragged into the court case.

As an LLC, you will be protected because they must sue your business.

This means that you can protect your personal finances even if you still mix them with your business finances in the same account.

The Guaranteed Way To Know If You Need A Business License

consult a professional

When it comes to going into business for yourself, the best thing is to consult a professional.

We are not here to give you legal advice or tell you how to run your business.

There are a lot of different contingencies when it comes to running a business.

This can be impacted by your products, business model, and local ordinances.

The law is a fluid thing and changes frequently.

Depending on when you read this, the information might already be outdated.

If you are truly worried about running your business correctly, consult a lawyer or tax adviser.

These individuals are trained to help you know what is needed for your business.

They can easily help you to get the most out of your business in a legal way.

This includes navigating tax breaks and other regulatory concerns.

The safest way to stay within the law is to work with someone who knows it.

While this might help you answer a few questions, we are in no way a good substitute for professional advice.

What License Do I Need to Sell Crafts

crafts

If you’re selling crafts then you will need a permit from the state you’re selling your merchandise.

Even if you’re selling crafts on a part-time basis, you still need a permit.

The permit will give you a tax identification number.

Keep in mind there may be some slight differences among the states. 

Nowadays, you can get permits from the state online, and you can pay for it pretty easily with a credit card.

One thing you can do is search for your state’s Department of Revenue, which will have information on what you need to do.

Conclusion

Making the decision to sell your art can be a huge step.

It is a matter of deciding that you are ready to share your creations with the world and taking action to do so.

As is the case with any business, you will want to make sure that you are taking the right steps.

The law is a tricky thing, and it gets even trickier around businesses because there is more to consider.

If you want to make sure that you are doing right by your business, there are plenty of professionals who can help.

In some cases, getting a business license can be a helpful decision to make in general.

This will give you the ability to legally do more with your business.

While you might be focused on one area to sell your art now, you might change your mind down the line.

It is relatively painless to set yourself up with a business license for this kind of stuff, so give it a shot.

Chances are you will never find a reason to regret doing so.

What is stopping you from selling your art?

Business License FAQ

Do artists need to register as a business?

Yes. You will need to register as a business. You can either register as a sole-proprietor, LLC, or corporation.

How do I start my own art business?

The key to a successful business is creating things that people want while being a business people trust. As an artist you should put yourself out there and create things that will help the community. As you build up your presence, you will develop a community of your own. When you have a community of your own, you will be able to sell products/services with ease.

Do freelance artists need a business license?

Yes. In most cases you need a business license.

Phylis

Friday 26th of March 2021

I’m considering selling artwork through a store. I will pay monthly space rent and a percent of commission on sales. The store will be collecting tax and paying the sales tax. Since I will have no contact with the tax portion will I need a vendors license? Thank you, Phylis

Jae Johns

Saturday 27th of March 2021

I'm not sure about your specific case. I do recommend checking your local region or state law, as every area is different. I hope everything works out for you Phylis.

Srijana

Thursday 27th of August 2020

Hi - I love painting and have done a good no. of framed art, which I started selling recently on FB marketplace because there was no place to keep at home. Some of my buyers were really happy with the work and wanted a few more. I did offer them a discount and sold them gradually because I paint as a hobby and not as a full-time profession. I wanted to know if selling such items on the FB marketplace is okay without a seller's permit or trader's license. I am temporarily located in Melbourne, Australia, and might go back to my home country once my husband's project is over. Am I doing it wrong? Or is it okay? Because my buyers still want some of the paintings that I offer in different modes like Bookmarks and small postcards (just 1 or 2 that I paint in two weeks when I have time as I stay back home). Kindly help me to understand this.

jaejohns

Friday 28th of August 2020

First off, congrats on being able to sell your paintings. It seems like it's going well for you, and that's great to hear!

As for the license, I recommend looking up the local or provincial laws in your area about the requirements. Each country is different. If you were in America I would say yes, and it doesn't matter if you were doing it on Facebook, Etsy, or Instagram. Facebook is just another "advertising" medium. With that said, I'm not a certified expert but based on my experiences and experiences from other artists, I will say to play it safe and get a license. Please check your local laws though.

I hope this helps.