What Kind of Business License Do I Need for a Hot Dog Cart?

by Catherine Rayburn-Trobaug, Demand Media

Operating a hot dog cart can be a low-cost, fun way of becoming a small business owner. The overhead is relatively cheap, and you can set your own hours and location. But like any other small business, you may need licenses at the federal, state and local level. In addition, depending on your area of operation, you may be required to show proof of insurance.

Federal

Hot dog carts don't require any federal license or permits, but you may need to apply for a federal Employer Identification Number (EIN). If your business is structured as a limited liability corporation, or if you have partners or employees, you will need this for tax withholding. If your business is structured as a sole proprietorship, you won't need to apply for this because you will be filing the business taxes under your own personal taxes.

State License and Permits

Each state has its own set of licenses and permits for hot dog carts, but there are some similarities. Many states will require you to charge a sales tax, so you will have to register with the state. You can do this by going to your state's business regulation website to register.

Related Reading: How to Lease a Grill Cart or Hot Dog Cart

Local

The local level is where licensing your hot dog cart might get complicated. Many counties will require registration or licensing, and you will need to obtain a health department permit from the county agency. Local license and regulation will vary greatly, but you might expect to show proof of insurance, have fire inspection permits and file a request for a location. Houston, Texas, for example, requires all of these items plus a cleaning schedule, a restroom availability letter and an initial inspection.

Support and Advice

Despite the dizzying array of licenses and permits, and the spectrum of local requirements, it still is relatively easy to start a hot dog cart business. There are numerous local and state organizations that can help walk you through the process. Check with the local chamber of commerce for local license information and the police department for ordinances that may require permits. Join a business organization like the Texas Retailers and Food Council for support and updates on licensing. The federal Small Business Administration has numerous tools to help out the new business owner with licensing, as well.

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