All operating businesses are subject to a number of tax obligations, permit and license requirements, zoning restrictions and other laws at the city, county, state and federal government levels.

As a future business owner, begin by learning what your obligations will be BEFORE opening your business. After learning the requirements, secure the forms, apply for the licenses and registration numbers and identify all the costs. These costs are not only part of business start up expenses but are an ongoing cost of doing business. So, place these expenses in your yearly operating budget and create a calendar of dates of when the taxes and licenses are due for renewal and payment.

General Information

While every business may not be subject to all of the requirements, it is, however, important to carefully read this information and the information provided by your respectively city, county, state and federal governments. Many requirements stem from the legal structure you choose for your business, the type of business you are starting, the estimated revenues, the number of employees, and the physical location of the business.

State: Kansas has published a booklet on operating a business in their state. They also operate clearinghouse phone lines for answering questions and informing you of their states' registration and tax requirements.

• Kansas: First Stop Clearinghouse, Kansas Dept. of Commerce, 700 SW Harrison, Ste. 1300, Topeka, KS 66603-3712 (785) 296-5298. Ask for Steps to Success: A Guide to Starting a Business in Kansas (there is a $3.50 charge for this excellent publication).

• Kansas City, Missouri has a special Business Assistance Center to help their businesses learn the city's requirements plus help business negotiate the "red tape" of City Hall. The center is located at 414 E 12th St., 15th Floor, KANSAS CITY, MO 64106 (816) 513-2880.

County: The county where your business is located requires you to register for their property tax rolls. Additionally, some counties require you to have a Merchants/Manufacturers License. As with the city call the county to learn about your obligations.

Federal: The federal government is primarily interested in income taxes, employee taxes, self employment taxes and specific regulations affecting the worker and workplace.

THE FOLLOWING IS A LIST OF THE MOST COMMON REQUIREMENTS

CITY REQUIREMENTS

Occupation License: Businesses operating in most metropolitan area cities must obtain an occupation license regardless of their size, composition or legal structure.
 

A pre-requisite for obtaining a license is usually a Zoning Clearance. The clearance assures that the location from which the business will operate has the proper zoning for that type of business. Home-based businesses can legally operate if they meet the "home occupation" requirements of their city. It is important to note that additional clearances may be required. For example, food-serving establishments require health department clearance in most cities.

Most occupation licenses are issued on a calendar year basis. The cost of a license may vary by type of business. There may be a flat fee for first registration or pro-rated fee based on the number of months remaining in the year. Fees may be based on gross sales, square footage of the business or home-based status.

STATE REQUIREMENTS

Legal Structure Registration: There are 4 basic forms of business organization, Sole Proprietorship, Partnership and Corporation and Limited Liability Company. Registration for these entities may vary by state; however, new corporations are required to register their Articles of Incorporation with the Secretary of State.

Missouri:

• Sole proprietors and general partnership must file a fictitious name registration for a fee of $7.00
• Limited partnerships register the partnership - fee $105.00
• Corporations file for a domestic corporate charter by filing Articles of Incorporation. Minimum fee is $58.00. Before finalizing a business name, a name check should be done. In the case of a corporation, if the name has not been previously registered, you can reserve your corporate name for 60 days for a $25.00 fee while the Articles of Incorporation are being prepared to be filed.
• Incorporated businesses from another state that plan to do business in Missouri must register as a Foreign Corporation for $155.00.
• Local Offices: Missouri Secretary of State, State Office Bldg., 615 E 13, KANSAS CITY, MO 64106 (816) 889-2925. All filing and registrations can be done locally.
• Jefferson City, Missouri, Secretary of State, Corporation Division, PO Box 778, 64102 (314) 751-2359 for new corporations and (314) 751-3317 for name registration.

Kansas:

• Kansas has no state requirements to register or file a fictitious name of a sole proprietorship.
• General partnerships are required to register their company name for tax purposes. This registration enables the state to determine who should be paying taxes relative to the partnership.
• Corporations are required to file Articles of Incorporation with the Secretary of State for $75.00. The corporate name is to be registered and must be distinguishable from other corporate names on file in Kansas. Name registration is $20.00
• Business based in another state other than a sole proprietorship that intends to establish an office, facility of plan to deliver products for sale or distribution are required to file as a Foreign Corporation. An application for authority may be obtained from the Topeka Office of Secretary of State, State Capitol Bldg., 2nd Floor, Topeka, KS 66612, (785 296-4564 or First Stop Clearing house, 785 296-5298 in Topeka
• Fees for filing for

METRO AREA CITY HALL PHONE NUMBERS
 

Kansas City, MO Earning and Profit Tax: A business must withhold an earning tax of 1% on the gross wages, salaries, commissions and all other earned compensation paid to employees living and/or working in Kansas City, MO. The amount withheld from employees' paychecks must be remitted to the city, quarterly, by the 25th day of January, April, July and October. For the business itself, the profit tax is 1% of net profits. A business return must be filed each year on or before April 15th.

Other Kansas City, MO taxes your business may be subject to include are business personal property tax, real property tax (property owners) and the utility tax which is a 10% gross receipts tax on users of electricity, natural gas, steam and telephone.

Kansas City MO Finance Dept., Revenue Division, City Hall 2nd Fl., 64106 - (816) 513-1120.

COUNTY REQUIREMENTS
Business Property Tax: The primary registration required at the county level is for property tax purposes. Other licenses such as a Merchants/Manufacturers may be an obligation depending on the county. Regardless of location of your business, the county courthouse is where you seek information on registering your business.

STATE SALES AND USE TAX NUMBERS
MISSOURI:

• Local Office, Missouri Dept. of Revenue, State Office Building 615 E 13th, Room 127, KANSAS CITY, MO 64106 (816)889-2901
• State Office: Missouri Dept. of Revenue, (314) 751-2836, Jefferson City, MO.

KANSAS:

• Kansas Dept of Revenue, Cloverleaf Office Park, Bldg. 3, Ste. 120, 6405 Metcalf, Overland Park, KS 66202, (913) 631-0296 or for assistance, service or forms 1-877-526-7738 Topeka Office: (785) 368-8222
• First Stop Clearinghouse: Topeka, KS (785) 296-5298

Registering as an Employer with the State: Every business employing people will be subject to state withholding taxes for all those individuals. Unemployment Insurance Tax and Workmen's Compensation is based on specific state requirements. Check with your respective state.

MISSOURI:

• Withholding Tax Number, Dept. of Revenue, State Office Bldg 615 E 13th, KANSAS CITY, MO 64106 (816) 889-2944
• Unemployment Insurance Tax: Required if an employer has workers in employment in as many as 20 calendar weeks or pays at least $1,500 in wages in a calendar year. Missouri Division of Employment Security, 1411 Main, KANSAS CITY, MO 64105 (816) 889-3000
• Worker's Compensation is mandatory if a business has 5 or more employees. Missouri Division of Workmen's Compensation, 1805 Grand, KANSAS CITY, MO 64108, 1-800-622-4123.

KANSAS:

• Withholding Tax Number: Kansas Dept. of Revenue, 6405 Metcalf, Overland Park, KS (913) 677-0158. Topeka Office: (785) 296-0222.
• Unemployment Insurance Tax: Dept. of Human Resources, Division of Employment Security (785) 296-0821.
• Worker's Compensation: Worker's Compensation Division, Dept. of Human Resources, Topeka, KS (785) 296-3441.

FEDERAL REQUIREMENTS

Federal Employment Taxes: Business owners have numerous federal tax obligations. The three main ones are income tax, self-employment tax and employment tax. To learn about the federal obligations a new business should:

Obtain the New Business Kit from the IRS. The kit contains forms and instruction books outlining business obligations. Publication 583, Taxpayers Starting a Business and Publication 334, Tax Guide for Small Businesses are two extremely helpful guides within this kit of information. Call 1-800-829-1040 for forms and questions.

Employer Identification Number (EIN): All businesses, which pay wages to one or more employee, must apply for an EIN. It is important to note that a Federal ID number is a different number than a state ID number and a sales/use tax number. Each require their own numbers.

An immediate Federal ID number my be obtained by calling for Missouri applicants - (816) 823-7777; for Kansas applicants (512) 460-7843 (you must have a Form SS-4 filled out prior to calling).  Click here  to view and print Form SS-4 (PDF File).

Income Tax: Every business files an annual income tax return. Which IRS form to use is dependent on the legal structure of the organization. Business taxes are estimated and paid quarterly.

Self Employment Tax: This tax is the social security tax for those individuals who work for themselves, such as sole proprietors and partnerships.

Employment Tax: Any form of business can have employees. If you have, your business is required to withhold the federal income tax from employee's wages, and withhold and match Social Security tax of the employee's wages. These dollars are submitted to the federal government by the employer. No matter what form of business organization is used, the owner(s) or stockholders of the business are personally liable for payment.

Additionally, Federal Unemployment Tax (FUTA) is paid by employers if you pay more than $1,500 in wages or have employees for 20 weeks in a calendar year.