Ecosystem: Business Regs & Policy
- Federal Regulations
- State Regulations
Federal Regulations? What do I need to worry about?
The Code of Federal Regulations, a document published each year by the federal government that lists all areas subject to regulation, is divided into 50 broad subsections. Given this fact, one could easily become overwhelmed by all of this information. The following are some basic things you may need to consider for your new business.
Is your business actually a small business in the eyes of the government? Programs created by the Small Business Act of 1953 such as loans, counseling, and contracts are only available if you meet size standards. Programs created by the Small Business Act in 1953 to help small businesses, like loans, counseling, and contracts, are only available to businesses that fit the size standards. You can learn more about this here or through our local SBA office located at Garrett College’s Small Business Center.
Licenses and Permits
If your business sells certain items like alcohol or firearms, operates oversized vehicles or plane, imports or exports animals, plants, or animal products, or broadcasts information via radio you will need to apply for a federal permit.
If none of those apply to you, you’re not necessarily off the hook: Depending on your state, you may need to apply for a state license or permit. Selling goods often requires a sales tax license, for example, while operating a veterinary clinic or a hair salon might require a professional license.
Almost every business needs some sort of license or permit to operate legally, but the tricky part is figuring out which ones you need. Check out the SBA’s directory of state license requirements and their guide to federal licenses for more information.
Employees and Overtime
Check into regulations on your employees and overtime if you are planning to employ a workforce. It is possible to hire contractually until you make a move to a full or part time workforce. You will also need to consider job-protected leave, minimum wage requirements, workers compensation and health insurance requirements (over 50 employees) if you have for a full time workforce.
If you have a place of business whether a manufacturing plant or a small office, you will need to follow OSHA requirements on safety such as evacuation plans, first aid kits and fall protection.
It begs repeating…GET AN ACCOUNTANT! The Federal tax code is highly complex and constantly changing. You are responsible for federal taxes on business income, self-employment and employment tax plus additional excise taxes depending on your industry.
The EPA regulates the ways a small business can release pollution and deal with hazardous materials. For more information on any of these, you can check out the Small Business Administration’s environmental regulation resource page.
You might think that “antitrust” only has to do with major companies, like Microsoft or Apple, but this is a common misconception. Small businesses are responsible for following antitrust laws, too, especially if there aren’t that many competitive products or services.
You’re not allowed to fix prices, divvy up markets, or boycott suppliers, according to antitrust laws, nor can you make any attempt to monopolize your marketplace through practices like predatory pricing or “tying,” which means that you force a customer who wants only one product to buy two instead.
You can read more about antitrust laws on the Federal Trade Commission’s website.
If you advertise your business, you cannot lie about what it does according to the Federal Trade Commission which oversees marketing and advertising laws. You can check out their website for a list of ways to make sure you are in compliance.
For email marketing, you cannot SPAM anyone according to the CAN-SPAM Act for commercial emails. You must also include your physical address in the email, and honor all “opt-out” or “unsubscribe” requests from recipients.
Phew! Is that all? Nope, next we take a look at State Regulations
Fortunately, Garrett County’s Economic Development. Has great resources for Maryland businesses. Some additional things to consider include:
Many professions such as lawyers, doctors, accountants, teachers, architects, and engineers require licensing. States also license people in a broad range of trades, from auto mechanics and barbers to real estate agents and tax preparers. Sometimes licenses are issued to the business, while other licenses are taken out by the individual. Licensing procedures vary, but you will need to prove evidence of training in your field and may have pass a written exam.
Products – You may also need a license to sell certain products like tobacco, liquor, food, gas, lottery tickets or firearms
More information on Maryland State Regulations can be found at the Garrett County Economic Development Website
If you are in retail, you may need to register for a sales tax permit or seller’s permit. You can find more information on this from the Garrett County Economic Development Website.
You will have to file your business structure with the state. More information on this is found in the business structure section of Mapping Your Business from session 2
As an employer, you will have to file with the State the same way you did with the federal government. Specific state requirements can be found at GCED online
There may also be state environmental regulations you must adhere to as you start your new company. Like federal requirements, state requirements are likely to be of concern if:
- Your equipment vents emissions into the air.
- You need to discharge or store waste water.
- Your business involves or produces hazardous wastes.
Environmental regulation isn't limited to manufacturers. Small businesses, such as stained-glass makers, dry cleaners, and photo processors, need to know how to dispose of the dangerous metals or chemicals used in their work.
**This list was by no means meant to scare you away from starting your own business. It was just an illustration of the things you may need to consider as you plan to launch. Being prepared is the best way to start.
Your business coach through the Garrett College Entrepreneurship Course can help you navigate through the federal and state regulations. (link to course)