What is a Nevada state business license?

Under Nevada law, most entities and natural persons cannot conduct a business in Nevada unless and until they obtain a “state business license” issued by the secretary of state. Nev. Rev. Stat. § 76.100. In general, a “business” that has to be licensed in Nevada is broadly defined to include any entity organized under Nevada law, “whether or not the entity performs a service or engages in a business for profit.” Nev. Rev. Stat. § 76.020. However, the definition of a “business” does not include, among other things, a 501(c)(3) corporation, a natural person whose sole business is the rental of four or fewer dwelling units to others, and a person operating a relatively small business from his or her home. (Motion picture companies used to be excluded from the definition of a “business” required to be licensed in Nevada, but that exclusion was removed in 2017.) A corporation applying for a Nevada state business license must pay a $500 fee with the initial application. In addition, a corporation must also pay $500 each year for the state business license annual renewal fee. Nev. Rev. Stat. § 76.130(2). The initial and annual state business license fees make Nevada a relatively expensive state in which to form and maintain a corporation, even though Nevada does not require the payment of a minimum franchise tax every year. By contrast, Delaware has a minimum annual franchise tax, but it is only $175, compared to the $500 state business license annual renewal fee in Nevada. For more information about the cost of incorporating in Nevada, see Why It Is a Bad Idea to Incorporate in Nevada If You’re Not Going To Do Business There.