When purchasing an existing business there are many things to research and consider in addition to the usual planning that goes into a business startup. One consideration is the transfer of local, state and federally required and mandated licenses. Requirements vary by locality, but many requirements are usually standard. Before venturing into a deal which requires the purchase of existing business licenses, an entrepreneur should check with local agencies for local laws and requirements.

In the case of a liquor license, a buyer should ensure license fees are paid current and are in good standing with local granting authority, and conduct a lien search to confirm that no other party has a security interest in the liquor license. In most municipalities a transfer fee will be required; in some, transfers are not permitted. Most licenses are good for one calendar year and require renewal annually.

The following are some additional optional requirements: the seller and buyer must fill out the necessary paperwork from the city or county in which the property is located; city or county can conduct a public hearing to approve the license transfer; the new owner may be required to have a sales tax license before the transfer is approved; all property taxes must be current for a transfer to be finalized, and a final sales tax return may need to be filed with the local and state tax departments. Furthermore, the federal government (through the Bureau of Alcohol, Tobacco and Firearms) requires the filing of an annual Special Occupational Tax Return, due on or before July 1st of each year. For help with liquor license requirements for a start up business, or when purchasing an existing business, please contact us by email.