Do online businesses need a business license?

I have a friend who lives in the state of Tennessee (Nashville) and owns an online business. The business has no location, is mail order, and operates out of a Postal Box. Do They need a business license?

They do not need a business license, but they do need to be registered in the city and state they are doing business in.

Or, at least be claiming there income when they file taxes each year.

To research this further, and get the most accurate information I would go to www.irs.gov, or contact the Attorney General in your state.

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I would strongly recommend it, especially as a sole proprietor. Your friend can use their postal box as a business address on the application ( in most places, they'll have to check with the city of Nashville), and as far as location it really isn't important. They will use either their postal box or home address as their business location.

By all means, if they are allowed to use the postal box, use it! With all the hysteria about terrorism and money laundering going on in the US right now, it's best to cover your bases..you never know what your neighbors may claim. Paranoid? Yep.

Make it legal. It may never be questioned how your friend earns their income but it's better to have proof when you need it than fly by the seat of your pants without a parachute.

YES they will also need to file taxes. They should never have to pay as most of their business is not local. But they have to file anyway.