Legal Question in Business Law in California

Starting a business, whether home based or on the 88th floor of the Empire State Building, is a multi-step process that includes (1) determining the form of business organization that will own and operate it, e.g., a sole proprietorship, partnership, corporation, limited liability company; (2) determining who will be the owner(s) and how they will share in contributions to the capital, managing its affairs, and reaping the profits (if any); (3) preparing and filing appropriate papers, such as incorporation or LLC documents. If you are the sole owner, things are simplified somewhat. If you have co-promoters, you should have a fairly comprehensive agreement between yourselves.

It sounds to me rather like yours will be a one-man business and a sole proprietorship as to legal structure. In that case, the answers to the foregoing questions will be relatively simple, but you need to be clear that, as such, you will need to take additional steps if you decide to take on partners, and that by becoming a proprietorship rather than a corporation or LLC that you are personally liable for business debts.

Your business starts when you start doing business transactions. The various registering, filing, etc. requirements are important, but secondary. The business starts when you start transacting business. All the filing stuff is perhaps important, but does not define the start or existence of the business enterprise. Starting a business is separate from licensing the business. Starting precedes licensing, at least as far as many activities are concerned.

My suggestion is that you acquire (by purchase or from a library) two or three of the popular self-help "law" books on how to start your own business. They are paperbacks and very not stuffy or hard to follow. Nolo Press is an often-recommended publisher, but certainly not the only one. Just make sure that the ones you buy and follow are based upon California law.

As to your specific question about timing of a business license, I think your city or county will be perfectly happy if you buy the license before the end of your first year in business. The main purpose of licensing businesses on a local level is to raise tax revenue, not to create or authorize the existence of, a business. I suggest having a chat with the business license people in your city or county. It's like getting a dog license. You don't become a dog owner by buying the license.