Frequently Asked Questions
Commerical Business Licenses
- What if I have two different types of businesses at a single location?
- If both business types fall under the same classification (for example 'retail sales') and the financial records are kept together, then only one license is required. If the business type falls under two or more classifications (for example 'retail sales and service'), then multiple licenses are required. If the financial records are kept separately, then multiple licenses are required. For more information, contact the Business Licensing Division.
- Where should I post my business license?
- If you have a fixed place of business, the license must be posted in a visible location. If your business is mobile, carry your license with you.
- I used to have a Modesto business license, how do I reactivate it?
- As long as the ownership remains the same, you may reactivate a business license by paying the new license fees and any past due fees and taxes. There must also be a current business license application on file.
- Do I have to file the Declaration of Gross Receipts forms if I have a minimum license?
- Although you do not pay Mill or DID tax, you must report your gross receipts (even if they are zero) to keep your license current and active.
- Do I have to file even if I did not do any business?
- Yes. You must report your gross receipts as zero, sign, date, and return the Declaration of Gross Receipts form, so that your license will remain current and active.
- How do I calculate Mill tax?
- Gross Receipts less the Adjustments (see reverse side of the Declaration of Gross Receipts form) equals the Taxable Gross. Multiply the Taxable Gross times the Mill tax rate. This is the Mill tax due. For example, if the tax rate is .002 and the taxable gross receipts for the quarter are $5000, the fee is calculated as follows:
$5000 X .002 = $10.00
For a list of allowed Adjustments, see the back of the Declaration of Gross Receipts form or contact the Business Licensing Division. Be sure to write the adjustments on the appropriate lines on the back portion of the form that is returned to the city.
- Can I deduct expenses?
- No. You must report the total amount of money collected, not just your profit. See the back of the Declaration of Gross Receipts form for allowed adjustments.
- What is DID tax?
- Businesses in the downtown area of Modesto pay an additional tax to the Downtown Improvement District (DID). DID tax is calculated in the same manner as Mill tax and paid at the same time.
Click here to view or print the
Business License Application