Alabama business licensing guide
Last checked: April 26, 2026
Alabama does not use one simple license that covers every business in every city. Most owners need to check several layers: state entity filing, Alabama tax accounts, a state/county business privilege license if their activity is listed under Alabama law, city business licensing, zoning, and any industry permit.
This guide explains the Alabama pieces in plain English and shows where to verify the details before you open, move, hire, sell, or renew.
The short answer
If you are starting a business in Alabama, do not start with the question, “Do I need a business license?” Start with the business activity and location.
Alabama has a state/county business privilege license system for businesses described in Title 40, Chapter 12 of the Code of Alabama. The Alabama Department of Revenue says not all businesses require a state/county business license, and the license is issued at the county level by the county Probate Judge or License Commissioner where the business is located. A city license may still be required because ALDOR does not administer municipal licenses.
Many businesses also need a state tax account through My Alabama Taxes, such as Sales Tax, Sellers Use Tax, Simplified Sellers Use Tax, Rental Tax, Lodgings Tax, or Income Tax Withholding. If you form an LLC or corporation, that is handled through the Alabama Secretary of State and is separate from licensing.
Alabama licensing snapshot
| Question | Alabama answer | Where to verify |
|---|---|---|
| Does Alabama have one statewide general business license? | No single Alabama license covers every business. Alabama has state/county business privilege licenses for listed activities, plus tax accounts, city licenses, and industry permits when they apply. | ALDOR business privilege license and ALDOR Quick Reference Guide |
| Who issues Alabama state/county business privilege licenses? | The county Probate Judge or License Commissioner in the county where the business is located. Unless another rule applies, ALDOR says a license is required in every county where the business is conducted. | ALDOR county probate office directory |
| Does a city license still matter? | Yes. ALDOR says it does not administer municipal licenses. You should check every city where you conduct business before transacting business there. | ALDOR city license FAQ |
| What is Alabama’s resale certificate called? | Alabama calls a resale certificate a Sales Tax License. In-state retail businesses register with ALDOR through My Alabama Taxes. | ALDOR sales tax license FAQ |
| What portal is used for Alabama tax accounts? | My Alabama Taxes, often called MAT, is used for many state tax account registrations, filings, payments, and license renewals. | ALDOR business tax online registration |
| What is Alabama’s DBA term? | Alabama uses trade name for a name used to identify a business, vocation, occupation, or profession. Trade name registration is handled by the Alabama Secretary of State. | Alabama Secretary of State trademarks, service marks, and trade names |
Quick start: what to check first
- Write down your exact business activity. A restaurant, online seller, home bakery, contractor, mobile vendor, short-term rental, and consultant may have different Alabama and local requirements.
- Confirm your location. Check the city, county, and whether the address is inside city limits, a police jurisdiction, or an unincorporated area.
- Decide whether you are forming an entity. LLCs, corporations, and similar entities are filed with the Alabama Secretary of State. A sole proprietor may not need an entity filing, but may still need licenses, tax accounts, zoning approval, or a trade name.
- Check the Alabama state/county privilege license list. Use ALDOR’s business privilege license page and Quick Reference Guide. If your activity is listed, contact the county Probate Judge or License Commissioner.
- Register for Alabama tax accounts if needed. Retail sales, rental, lodgings, sellers use, consumer use, simplified sellers use, and withholding tax accounts are handled through My Alabama Taxes.
- Call the city before you open. City business licenses, zoning clearance, home occupation rules, building approval, fire review, signage, and local taxes can block or delay opening.
- Check industry permits. Food, alcohol, construction, health care, childcare, body art, transportation, and regulated professions may need extra state or county permits.
Practical tip: In Alabama, county and city licensing can both matter. A business inside a city may need a state/county privilege license issued at the county level and a separate municipal license from the city.
Alabama business licensing has several layers
Do not treat every filing as a “business license.” These are different items handled by different offices.
| Layer | What it may cover | Alabama example | What to do |
|---|---|---|---|
| Federal | Federal tax ID and federally regulated activities | IRS Employer Identification Number, federal permits for some regulated industries | Use the IRS EIN page and check federal licensing if your activity is regulated by a federal agency. |
| State | Entity filings, state tax accounts, professional boards, state-level permits | Alabama Secretary of State formation filing, ALDOR tax accounts, ABC license, ADPH food rules, construction boards | Use the Alabama Secretary of State, ALDOR, and the state agency that regulates your industry. |
| County | State/county business privilege license, health department review, county-level permits | County Probate Judge or License Commissioner issues state/county business privilege licenses; county health departments handle many food and lodging applications. | Contact the county where the business is located or where business is conducted. |
| City or town | Municipal business license, zoning, occupancy, local taxes, police jurisdiction rules | Birmingham, Huntsville, Mobile, and other cities have their own business license processes. | Check the city business license office and zoning or planning office before opening. |
| Private platforms | Marketplace, payment processor, landlord, or app rules | Etsy, Amazon, Shopify, DoorDash, Airbnb, commercial lease rules | Follow platform rules, but do not treat platform approval as a government license. |
The Alabama state/county business privilege license
Alabama uses the term business privilege license for many state/county licenses. ALDOR says a privilege license is required for every person, firm, company, or corporation engaged in a business, vocation, occupation, or profession described in Title 40, Chapter 12 of the Code of Alabama.
This does not mean every Alabama business has the same license. ALDOR’s Quick Reference Guide tells readers to locate their type of business and notes that not all businesses require a state/county business license. It also says multiple licenses may be required depending on the business operation.
Where you get it
The state/county license is issued by the county Probate Judge or License Commissioner in the county where the business is located. ALDOR’s page also says that, unless otherwise provided, a license is required in every county where the business is conducted.
Renewal timing
ALDOR’s Quick Reference Guide says state/county business privilege licenses must be renewed each year by October 31, or a 15% penalty plus interest will be applied. Confirm the current renewal process with your county office because county procedures can vary.
Do not stop at the county license. ALDOR says it does not administer municipal licenses. If you operate in a city, sell into a city, open a storefront, work from home inside city limits, or do work across multiple cities, contact each city office before transacting business there.
LLCs, corporations, and Alabama trade names
Forming an LLC or corporation is not the same as getting a business license. Entity filing creates or registers a legal business entity. Licensing and permits control whether that business may operate a specific activity in a specific place.
Alabama Secretary of State entity filings
The Alabama Secretary of State Business Entities Division is the filing office for domestic entities and foreign entities that have qualified to transact business in Alabama. The office serves corporations, LLCs, limited partnerships, registered limited liability partnerships, and related entities.
For an Alabama LLC, the Secretary of State’s Certificate of Formation form says the Certificate of Formation and filing fees must be filed with the Office of the Secretary of State. The form also says a copy of the Name Reservation Certificate must be attached and that the registered office street address must be located in Alabama.
You can start with the Alabama Secretary of State Business Entities page or the Secretary of State Online Services portal.
Alabama trade names
Alabama does not mainly use the phrase “DBA” on its Secretary of State trade name page. It uses trade name. The Secretary of State says a trade name is used to identify the business, vocation, occupation, or profession.
Trade names, trademarks, and service marks may be registered by submitting an application, specimens, and the registration fee. The Secretary of State says the effective term for mark registrations is five years. It also says rejection or denial of a mark registration does not prevent use of the mark, and ownership conflicts are handled outside the Secretary of State’s Office.
Name tip: A Secretary of State entity name, a trade name, a domain name, and a city business license name are related, but they are not the same thing. Keep a list of every name you plan to use and ask the city, county, bank, tax agency, and licensing board which name they need on each application.
Sales tax, resale certificates, and Alabama tax accounts
If you sell taxable goods or services, rent property, provide lodging, sell into Alabama from outside the state, or hire employees, you may need an Alabama tax account. These accounts are not the same as a city business license.
Sales Tax License and resale certificate
ALDOR says that in Alabama, a resale certificate is called a Sales Tax License. To obtain a resale certificate or sales tax license, an in-state retail business must register with ALDOR through My Alabama Taxes.
After online registration, ALDOR says a confirmation number is provided, and the license is mailed later. ALDOR also says businesses can print a copy of the Sales Tax License from MAT by locating the tax account and using the “Print tax account license” link.
Other Alabama tax account types
ALDOR’s online registration page lists several tax account types that can be registered through My Alabama Taxes, including Sales Tax, Sellers Use Tax, Simplified Sellers Use Tax, Consumers Use Tax, Rental Tax, Lodgings Tax, Prepaid Wireless 911 Service Charge, Income Tax Withholding, and other specialized taxes.
ONE SPOT for local sales, use, rental, and lodgings taxes
Alabama also has ONE SPOT, which stands for Optional Network Election for Single Point Online Transactions. ALDOR says ONE SPOT provides a single-point filing system through My Alabama Taxes for state-administered and non-state-administered local sales, use, rental, and lodgings taxes.
Annual renewal for Alabama tax account licenses
ALDOR posted that Alabama Tax Account Licenses for Sales Tax, Rental Tax, Sellers Use Tax, Lodgings Tax, Utility Gross Receipts Tax, and Simplified Sellers Use Tax must be renewed each November-December. At renewal, businesses should review items such as legal name, DBAs, owner information, phone numbers, FEINs, addresses, NAICS code, and business description.
Online seller warning: Marketplace tax collection does not always solve every licensing issue. You may still need an Alabama tax account, a city license, a county privilege license, a home occupation approval, or an industry permit depending on what you sell, where you operate, and how you deliver.
If you hire employees in Alabama
Hiring adds another layer. Payroll tax and labor registrations are not the same as a business license, but they can be required before or soon after hiring.
Alabama withholding tax account
ALDOR says an employer with employees working in Alabama must register with the Department of Revenue for a withholding tax account number. Employers can apply through My Alabama Taxes.
Alabama unemployment tax account
The Alabama Department of Labor says a business can open an Alabama unemployment tax account by completing Form SR-2, Application to Determine Liability, and employers should submit an application as soon as liability has been established.
New hire reporting
The Alabama Department of Labor says employers must report each newly hired or recalled employee. The Department’s New-Hire page says the information must be furnished within seven days from the date of hire or reemployment. Employers with five or more employees must report through the internet system.
Payroll tip: Ask your payroll provider to confirm the Alabama withholding account number format and unemployment account setup before the first payroll run.
Industry permits that may apply in Alabama
Some businesses need a state board, county health department, or special license before a city or county will issue the local license. ALDOR’s municipal business license page says that if a business is in an occupation shown on its regulatory board list, the business should present the permit or certificate from that board or agency before being issued a municipal business license.
| Business type | Possible Alabama agency or office | What to verify |
|---|---|---|
| Restaurant, grocery, food truck, mobile food unit, lodging, hotel | Alabama Department of Public Health Food and Lodging and local county health department | Plan review, food establishment permit, temporary event rules, mobile food unit packet, county application process, and inspections. |
| Home-based cottage food | ADPH Cottage Food Law FAQ and local county health department | Allowed foods, food safety course, label review, cottage food review form, direct-to-consumer sales, and local zoning. |
| Alcohol or tobacco sales | Alabama ABC Board Licensing and Compliance | ABC license or permit, local approval, county division contact, renewal, label or promotion approval where relevant. |
| Residential home building, remodeling, roofing | Alabama Home Builders Licensure Board | Whether you need an unlimited, limited, or roofers license; application package; exams; bond or financial requirements. |
| Commercial or industrial contracting | Alabama Licensing Board for General Contractors | Whether a prime contractor, subcontractor, specialty classification, exam, or renewal rule applies. |
| Professional services | State professional board for the occupation | Board license, certificate, continuing education, firm registration, and whether the city requires proof before issuing a municipal license. |
Home-based businesses in Alabama
A home-based business can still need a license. The key question is not only “Do I work from home?” It is also “What do I do from home, where is the home, and do customers, deliveries, inventory, signs, employees, food, noise, or vehicles affect the property?”
For example, the City of Huntsville says a business license is required for commercial and residential-based businesses operating in the city. The City of Mobile requires a business license for a person, firm, or entity conducting business from, into, or within the city and its Police Jurisdiction. Birmingham says the city has authority to license businesses conducting trade or providing services within its city limits.
What to check before running a business from home
- Whether your home address is inside city limits, a police jurisdiction, or an unincorporated county area.
- Whether the city requires a business license for home-based or residential-based businesses.
- Whether zoning allows your use at that address.
- Whether customers, employees, deliveries, storage, signs, vehicles, or noise are limited.
- Whether your lease, HOA, or mortgage rules limit business use.
- Whether food, childcare, body art, health, alcohol, or construction work needs a separate permit.
Cottage food is not a general home-business pass. ADPH says Alabama cottage food operations must complete a food safety course, label cottage foods, and submit a cottage food review form to the local county health department. The Cottage Food Law FAQ says the local county health department reviews the food safety course certificate and product labels, not the home kitchen. Local zoning and business license rules can still apply.
Alabama city links to check next
City rules can change the answer. These links help you move from the state hub to the local layer.
Existing BusinessLicenseGuide city pages
| City | BLG guide | Official city starting point |
|---|---|---|
| Birmingham | Birmingham, AL Business License Guide | City of Birmingham business license information |
| Mobile | Mobile, AL Business License Guide | City of Mobile business license application and renewal |
Other large Alabama city official pages
Official Alabama agency directory
Use these official sources to verify your own business. Do not rely on a copied checklist if your business type, city, county, ownership, or location is different.
| Need | Official source | Use it for |
|---|---|---|
| Entity filing, LLC, corporation, name search | Alabama Secretary of State Business Entities | Domestic formation, foreign registration, business entity records, name reservation, forms, certificates. |
| Trade name, trademark, service mark | Alabama Secretary of State Trademarks | Trade name registration, mark renewal, specimens, assignment, and records search. |
| State/county privilege license | ALDOR business privilege license | State/county business privilege license rules and county issuing office direction. |
| County license office lookup | ALDOR county probate office directory | County Probate Judge or License Commissioner contact information. |
| Tax accounts | ALDOR business tax online registration | Sales Tax, Sellers Use Tax, Simplified Sellers Use Tax, Consumers Use Tax, Rental Tax, Lodgings Tax, and withholding accounts. |
| Local sales, use, rental, and lodgings tax filing | ALDOR ONE SPOT | Single-point filing through My Alabama Taxes for many state and local taxes. |
| Food, lodging, food trucks, cottage food | ADPH Division of Food, Milk and Lodging | Food safety, county health department permits, cottage food review, food establishment plan review, mobile food unit packet. |
| Alcohol and tobacco | Alabama ABC Board Licensing and Compliance | Licenses and permits for alcohol or tobacco locations in Alabama. |
| Employees | Alabama Department of Labor employers | Unemployment tax account, new hire reporting, employer resources. |
| Federal EIN | IRS EIN page | Federal Employer Identification Number application and IRS tax identification basics. |
Step-by-step Alabama checklist
- Define the business activity. Write one plain sentence: “I will sell [products/services] from [home/store/mobile/online] to customers in [city/county/state].”
- Confirm the operating address. Check city limits, county, zoning district, police jurisdiction if relevant, and whether you will operate from more than one location.
- Choose the legal structure. Decide whether you are a sole proprietor, LLC, corporation, partnership, or nonprofit. Get advice if liability, tax, or ownership issues are important.
- File with the Alabama Secretary of State if needed. LLCs, corporations, and some other entities use the Secretary of State. Sole proprietors usually do not create an entity just by getting a license.
- Check name issues. Search business entity records, check whether you need a name reservation, and review Alabama trade name registration if you will use a public name different from your legal name.
- Apply for an EIN if needed. Use the IRS, not a paid site that looks official. An EIN is often needed for hiring, entity tax filing, banking, and some applications.
- Register for Alabama tax accounts. Use My Alabama Taxes if you need Sales Tax, Sellers Use Tax, Simplified Sellers Use Tax, Rental Tax, Lodgings Tax, Consumers Use Tax, or Income Tax Withholding.
- Check the state/county business privilege license. Use ALDOR’s business privilege license page and Quick Reference Guide. Contact the county Probate Judge or License Commissioner if your activity may be listed.
- Contact the city business license office. Ask whether you need a municipal business license before opening or conducting business in that city.
- Contact zoning or planning. Do this before signing a lease or opening from home. Ask whether your use is allowed at the address and whether home occupation, occupancy, fire, building, signage, or parking rules apply.
- Check industry permits. Food, alcohol, construction, health, childcare, transportation, lodging, body art, and other regulated activities may need approval before a local license is issued.
- Save proof and renewal dates. Keep copies of every license, tax account, email, approval, receipt, and renewal deadline. Add reminders for county, city, state tax account, and board renewals.
Common Alabama licensing mistakes
- Assuming an LLC is a business license. An LLC is an entity filing. It does not replace city licensing, county privilege licensing, tax accounts, or permits.
- Skipping the city because you got a county license. ALDOR says it does not administer municipal licenses. City rules are separate.
- Using “seller’s permit” language and missing Alabama terminology. Alabama calls the resale certificate a Sales Tax License.
- Forgetting county-by-county rules. ALDOR says a state/county license is generally required in every county where the business is conducted, unless another rule applies.
- Not checking zoning before signing a lease. A city may require zoning clearance or occupancy approval before a business license can be issued.
- Running a home business without checking residential rules. Home-based businesses may still need city licenses and zoning approval.
- Opening a food business before talking to the county health department. ADPH directs applicants to local county health departments for food or hotel permit applications.
- Missing annual renewals. County privilege licenses, city licenses, state tax account licenses, and professional licenses can have different renewal windows.
- Relying only on a marketplace or platform. Platform approval does not mean the city, county, state tax agency, or licensing board has approved your business.
What to ask when you contact the agency
Before calling or emailing, have your business details ready. Include your business type, legal name if you have one, trade name if you use one, city, county, address or general location, whether it is home-based, mobile, online, or storefront, and what products or services you will sell.
Phone or email script
Hello, I am starting a [business type] in [city], [county], Alabama. The business will operate from [home-based / mobile / storefront / online] at or near [address or general location]. I will sell or provide [products or services]. Can you confirm whether I need a city business license, county or state/county business privilege license, zoning approval, tax registration, health permit, building or fire approval, professional license, or another permit before I start? If your office does not handle one of these, which office should I contact next?
If you are contacting a city, ask for both the business license office and zoning or planning office. If you are contacting a county, ask whether the Probate Judge, License Commissioner, or county health department is the correct office for your question.
- Write down the name of the license, permit, tax account, or approval the agency gives you.
- Write down the office name and the person or department that answered.
- Ask whether the requirement applies before opening, before advertising, before making sales, or before hiring.
- Ask for the official application link or form page.
- Ask whether zoning, health, fire, building, or professional board approval must happen first.
- Ask whether the license renews annually and what date controls the renewal.
- Save the date of the call or email and keep a copy of any written response.
What to do today
- Open the ALDOR business privilege license page and Quick Reference Guide.
- Open your county’s Probate Judge or License Commissioner listing from the ALDOR county directory.
- Open your city’s business license page and zoning page.
- Open My Alabama Taxes if you need a Sales Tax License or other tax account.
- Open the Alabama Secretary of State page if you are forming or registering an LLC, corporation, or other entity.
- Open the state board or agency page for your industry before applying locally.
Review note
This page was last checked against Alabama official sources on April 26, 2026. Agency pages, portals, forms, fees, renewal windows, and local ordinances can change. Always confirm important details with the official agency before acting.
FAQ
Does Alabama have a general statewide business license?
No single Alabama license covers every business. Alabama has a state/county business privilege license system for businesses described in Title 40, Chapter 12, but ALDOR also says not all businesses require a state/county business license. You may still need city licensing, tax accounts, zoning approval, or industry permits.
Where do I get an Alabama business privilege license?
State/county business privilege licenses are issued by the county Probate Judge or License Commissioner in the county where the business is located. Unless another rule applies, ALDOR says a license is required in every county where the business is conducted.
Do I need a city business license in Alabama?
You may. ALDOR says it does not administer municipal licenses and that you should check with every city office where you are conducting business before transacting business. City licensing, zoning, renewal dates, and local taxes vary by city.
Is an Alabama LLC the same as a business license?
No. An LLC is a legal entity filing with the Alabama Secretary of State. A business license, tax account, zoning approval, health permit, alcohol license, contractor license, or professional license may still be required depending on your activity and location.
What is a resale certificate called in Alabama?
Alabama calls a resale certificate a Sales Tax License. ALDOR says an in-state retail business registers with the Alabama Department of Revenue through My Alabama Taxes to obtain a sales tax license or resale certificate.
Do Alabama tax account licenses renew?
Yes. ALDOR says Alabama Tax Account Licenses for Sales Tax, Rental Tax, Sellers Use Tax, Lodgings Tax, Utility Gross Receipts Tax, and Simplified Sellers Use Tax must be renewed each November-December through My Alabama Taxes.
Can I run a business from home in Alabama?
Possibly, but you must check local rules. A home-based business may still need a city business license, zoning or home occupation approval, a county or state/county license, tax accounts, and industry permits. Food, childcare, body art, and other regulated activities need extra review.
Do Alabama cottage food businesses need health department review?
Yes. ADPH says a cottage food operation must complete a food safety course, label all cottage foods, and submit a cottage food review form to the local county health department. The county health department reviews the food safety course certificate and product labels.
Who do I contact first if I am not sure what Alabama license I need?
Start with the city business license office and zoning office for your business location, then the county Probate Judge or License Commissioner for the state/county privilege license. If your business is regulated, also contact the state board or agency for your industry.
Disclaimer
This guide is for general information only. It is not legal, tax, financial, insurance, employment, safety, immigration, or professional advice. Business licensing rules, fees, forms, portals, renewal dates, and local requirements can change. Confirm important details with the official agency or a qualified professional before you act.