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 Pennsylvania 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 Pennsylvania. A sole proprietor or general partnership that includes the owner’s full legal name(s), does not have to register their business name with the state. Start with a statewide corporate business name search to avoid legal problems and customer confusion.
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+Pennsylvania” 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.
In Pennsylvania and in many other states, the use of the words “company” or “co.” in a Fictitious or DBA (“doing business as” name) name for sole proprietors and general partners is acceptable. However the words, “corporation” or “limited” is not acceptable.
Register a Fictitious Name with the state Pennsylvania. Form name: Registration of Fictitious Name [DSCB:54-311]
The state of Pennsylvania requires businesses that register a Fictitious Name to place ads in both:
• a general circulation newspaper
• a legal publication in the county where the business is based
Find legal publications by county.
In the state of Pennsylvania, filing a Fictitious Name does not guarantee a business sole rights to the use of that name. Other businesses in the state may also register the same fictitious name. Registered businesses are expected to legally defend their trade names.
Business License Registration
Sole proprietors and general partners do not have to apply for a state business license in Pennsylvania. Residential house cleaning businesses should check with the local city or county clerk’s office for licensing requirements.
Note: Pennsylvania provides an online business portal for new businesses, the PA Business One-Stop Shop that leads to addresses, phone numbers and links to state government agencies new businesses need to get started.
In Pennsylvania, a general partnership is created when two or more owners form an oral or written agreement to start a business together. While general partners are not required to file any documents with the Secretary of State, it is advisable to file an assumed name certificate, trademark registrations and have a written partnership agreement drawn up by a lawyer.
While both or all general partners are considered agents of the partnership with the authority to bind the partnership, the state of Pennsylvania encourages general partners to file a Certificate of Partnership Authority. This certificate designates one partner who is the primary contact person for the partnership. The authorized partner handles property and binding legal business between the partnership and government agencies and banks, etc.
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
Residential house cleaning services are taxable in Pennsylvania. Cleaning businesses must collect and send sales taxes to the Pennsylvania Department of Revenue. Cleaning businesses such as housecleaning, maid, housekeeping or janitorial services must register with the Department of Revenue for the Sales, Use and Hotel Occupancy Tax, Public Transportation Assistance Fund Taxes and Fees and Vehicle Rental Tax. Register through a secure online portal.
Sole proprietors and general partners pay tax on business income to the state of Pennsylvania through their personal state tax return. Sole proprietors and general partners are responsible for paying estimated self-employment income taxes in Pennsylvania (on Form PA-40 ES (I) ) similar to the way self employment taxes are paid to the federal government. Get more information about estimated tax requirements by calling the Pennsylvania Department of Revenue at (888) 728-2937 or (717) 425-2533.
Pennsylvania general partnerships that file a Federal partnership information Form 1065, may need to file state income tax Form PA-20S/PA-65. Get more information from a CPA or qualified tax preparer to find out if your partnership must file those returns.
Selected Pennsylvania City Licenses
Allentown Business License: https://www.allentownpa.gov/Home/Applications-Forms (IN-CITY BUSINESS APPLICATION – under Finance)
Bethlehem Business License: https://www.bethlehem-pa.gov/admin/busregistration.html
Erie Business License: The city of Erie does not require a business license for housecleaning services.
Lancaster Business License: http://www.cityoflancasterpa.com/business/business-registration
Philadelphia Business License: https://business.phila.gov/commercial-activity-license-city-of-philadelphia-tax-id/
Pittsburgh Business License: http://pittsburghpa.gov/finance/new-bus-reg
Reading Business License: https://www.readingpa.gov/content/business-privilege-license-application
Scranton Business License: http://www.scrantontaxoffice.org