This article provides three key state business startup requirements for self-employed sole proprietors and general partners who run residential house cleaning businesses. Information from the Secretary of State, the Mississippi Department of Revenue and selected city and county government sources were used to research this article.
Be aware that sole proprietor and general partner startup requirements in this state are always changing. Some requirements even vary from county to county. It is important that you call or visit your local county or city government to find out local requirements for residential house cleaning businesses and home-based businesses. This article is not intended to be exhaustive or a substitute for qualified legal or tax advice.
Business Name Registration
Sole proprietors and general partners who want a business name that does not include the owner(s) full names (for example, Janice Smith’s Cleaning Service or Martha Harris and Tom Graham’s Maid Service) need to find out whether the name they want to use is available in the state of Mississippi. Start with a statewide corporate business name search.
Then do an online search for names similar to the one you plan to use. For example, if you want to use the name, Crystal Clean Maid Service, do simple Google searches for “Crystal Clean Maid Service+Mississippi” plus Crystal Clean Maid Service+your county” and “Crystal Clean Maid Service+your town or city”. Search beyond the first page of results. Go at least five pages deep into the search results to see if the name you want or similar names are being used in your state, county or city.
Registration of a business name with the state of Mississippi is not required. However, registering a Fictitious Name or DBA (“doing business as” name) helps a business in these ways:
• Other businesses are less likely to use the same or similar name. It is important to remember that registering a Fictitious Name with the state of Mississippi does not guarantee a business sole rights to the use of that name. Other businesses in the county and state may also register the same Fictitious Name. Registered businesses are expected to legally defend their Fictitious Names.
• Banks and credit unions may require registration of a business name before opening an account or applying for a loan.
• Registering a business name helps potential customers learn the name and location of the business owner. Registration helps customers identify legal businesses and reduce fraud.
Business License Registration
Sole proprietors and general partners do not have to apply for a state business license in Mississippi. Residential house cleaning businesses should check with the local city or county clerk’s office for licensing requirements.
Mississippi provides an online business portal called MISSISSIPPIBOSS (Business One Stop Shop). The BOSS portal starts with five questions. Based on the answers, a person planning a new business gets information and links to county and city offices for local license and tax registration.
In Mississippi, a general partnership is created when two or more owners form an oral or written agreement to start a business together. General partners are not required to file any documents with the Secretary of State. It is advisable for general partners to file a Fictitious Name or DBA in the county where the business is based. A written partnership agreement drawn up by a lawyer is important for both or all partners. Partnership agreements do not have to be filed with the state.
Sole proprietors and general partners may apply for an Employer Identification Number (EIN) from the IRS even if they do not plan to hire employees. Getting an EIN may make it easier to open a bank account and reduce your risk of identity theft. You can apply for an EIN online. In addition, some business registration forms will require a NAICS business classification number for the house cleaning industry.
Business Tax Registration
Register with the Mississippi Department of Revenue through the online business portal MISSISSIPPIBOSS (Business One Stop Shop).
Residential house cleaning services are not taxable in the state of Mississippi. House cleaning businesses do not have to collect and send sales taxes to the Department of Revenue.
Sole proprietors and general partners pay tax on business income to the state of Mississippi through their personal state tax return. Sole proprietors and general partners are responsible for paying estimated self-employment income taxes in Mississippi (on Form 80-105) similar to the way self employment taxes are paid to the federal government. Get more information about estimated tax requirements by calling the Mississippi Department of Revenue at (601) 923-7700.
Mississippi general partnerships that file a Federal partnership information Form 1065, may need to file state income tax Form 84-105. Get more information from a CPA or qualified tax preparer to find out if your partnership must file those returns.
Mississippi has two local city taxes and none at the county level. The City of Jackson adds a 1% tax on services provided within the city limits. The City of Tupelo adds a .25% tax on services provided within the city limits.
Selected Mississippi City Licenses
Biloxi Business License: https://www.biloxi.ms.us/contact-us/
Gulfport Business License: (Privilege Tax License) http://www.gulfport-ms.gov/gen_finance/
Hattiesburg Business License: (Privilege Tax License) http://www.hattiesburgms.com/cityclerk/
Jackson Business License: (Privilege License) https://www.jacksonms.gov/business-license/
Meridian Business License: (Business Privilege License) https://www.meridianms.org/city-departments/finance-and-records/divisions/#business-affairs
Olive Branch Business License: https://www.obms.us/information/
Southaven Business License: https://southaven.org/111/Business-License-Information
Tupelo Business License: (Privilege License) http://www.tupeloms.gov/departments/finance or call 662-841-6513.