Sandpoint Business License: General City License and the 14% Lodging Tax After the STR Permit Ended

Starting a business in Sandpoint involves two layers of paperwork. The first is the Idaho Secretary of State filing that creates your company. The second is the city, which requires a general city business license for most businesses and sets its own rules for home-based work, temporary events, and lodging. Lodging changed on July 1, 2026. Sandpoint stopped administering short-term rental permits because of state law (HB 583, Idaho Code 67-6539), but the 14% local option lodging tax still applies. This guide lays out the steps in the order most people should handle them.

What You Need Before You Start

• Your proposed business name, plus a list of any other names you will use with customers
• A physical Idaho street address for your registered agent (P.O. boxes are not accepted)
• Names and addresses of your owners, members, or organizers
• A written list of your activities, including whether you will serve alcohol, host events, rent lodging, or work from home
• A payment method for the Secretary of State fee ($100 online for an LLC, $120 on paper) and the city fees, which you will need to confirm
• A sales tax permit if you sell taxable goods or services, applied for through tax.idaho.gov/ibr

Step 1: Sort Out What Your Business Actually Requires

Idaho has no state general business license. Registering your entity with the Secretary of State is a registration, not a license. Counties issue no general business license either, so your local question is almost always about the city. Sandpoint requires a general city business license under City Code Title 3, chapter 11. If you run a business from your home, check Title 9, chapter 11, because home-based businesses are governed separately.

Not every activity works the same way. If you are a contractor, Idaho does not issue a statewide general contractor license. Contractors register with the Idaho Contractors Board at DOPL. The Business Wizard at business.idaho.gov generates a checklist of the agencies and permits a specific activity needs, which is a useful first pass before you file anything.

Step 2: Form Your Entity With the Secretary of State

For an LLC, you file a Certificate of Organization. The fee is $100 online through SOSBiz or $120 on paper. Corporations file Articles of Incorporation for the same $100 online fee.

Before you file, search your name at sosbiz.idaho.gov/search/business. Under Idaho Code 30-21-302(d), an LLC name must include "limited liability company," "limited company," "LLC," "L.L.C.," "LC," or "L.C." "Ltd." and "Co." are acceptable abbreviations for "Limited" and "Company." The name must also be distinguishable from existing names on the state's records, and it may not imply government affiliation.

Every entity must keep a registered agent in Idaho. The agent needs a physical Idaho address and must be available during normal business hours. You can act as your own registered agent if you have an Idaho address. A DBA cannot serve as the registered agent.

Step 3: File an Assumed Business Name if You Use a Different Name

If customers will see a name other than your legal entity name, file a Certificate of Assumed Business Name, commonly called a DBA. It is filed with the Idaho Secretary of State, not the county. The fee is $25 online or $45 on paper, and the paper fee includes a $20 manual data entry surcharge. An assumed business name stays active until you cancel it and does not require renewal. If you want to hold a name while you finish formation, the name reservation costs $20 and lasts 120 days, through sos.idaho.gov/business-forms.

Step 4: Apply for the Sandpoint General Business License

Submit the city general business license application and fee at least 10 days before your business starts operating. The license is valid for one year from the date of issue, so put the renewal on your calendar when you receive it.

This guide does not state the license fee. Confirm the current amount with the Sandpoint City Clerk or on the city's fee schedule before you budget for it. Do not assume a fee from another Idaho city applies in Sandpoint.

Step 5: Handle Lodging Without a Permit, but Not Without Tax

This is where most short-term rental owners get confused. Sandpoint no longer administers a short-term rental permit, and state law (HB 583, Idaho Code 67-6539) bars cities and counties from requiring a license, fee, permit, or registration for a short-term rental. The 14% local option lodging tax under City Code Title 3, chapter 10 still applies, and you must still register for it, collect it, and remit it.

A tax registration is a tax obligation, not a short-term rental permit. Ending the permit program does not end your paperwork. If you list on a booking marketplace, the marketplace may collect the tax for you, but you remain responsible for making sure it was collected and paid. Ask the City Clerk which office handles lodging tax registration, the filing schedule, and remittance.

Late payment has a penalty. The initial late penalty is the greater of 5% of the tax owed or $10. Idaho state taxes may also apply to your rental, including the 6% state sales tax, so confirm with the Idaho State Tax Commission which state taxes apply to your situation.

Step 6: Clear Alcohol, Event, and Health Requirements

Alcohol requires a state license and a Bonner County license, and you should have both in hand before you move forward on the city side. Ask the City Clerk to confirm the order of applications, since the sequence determines when you can open.

Sandpoint also issues a temporary event license for events lasting up to four days. The fee is not confirmed in this guide, so check with the City Clerk. If your business involves food service or another health-regulated activity, contact Panhandle Health District before opening and ask what it requires for your specific activity.

Step 7: Set Up Your Tax Accounts and Annual Report

Idaho has a flat 5.3% individual income tax. A default LLC is a pass-through entity, so members report their share of income on personal returns. An LLC that files a partnership or S corporation return owes the $10 permanent building fund tax, and an LLC taxed as a C corporation pays the 5.3% business income tax plus that $10 fee. Idaho has no franchise tax and no LLC-specific annual state tax.

The annual report is required every year. For LLCs and corporations, it is due before the end of the month in which your formation document became effective, beginning one year after formation. The state lists the annual report fee as no fee under Idaho Code 30-21-214. Set a recurring reminder the day you file.

Tips for Getting This Right

• Get the city answer in writing. Phone answers about fees and sequencing are easy to misremember, so ask the City Clerk to confirm them by email.
• Pay for speed only when you need it. Standard SOS processing typically takes 7 to 10 days. Expedited filing adds a $40 surcharge for evidence of filing within 8 working hours. Same day service adds $100 for filings received before 1:00 p.m. Mountain time.
• Keep your registered agent address current. A missed notice from the agent can cause problems you may not learn about until it is too late.
• Use one calendar for all deadlines. The city license renews yearly, the annual report recurs yearly, and lodging tax filings follow their own schedule.

Common Mistakes to Avoid

• Assuming the county issues a general license. Counties do not issue a general business license. Bonner County matters mainly for alcohol.
• Filing the DBA with the county. Assumed business names are filed with the Secretary of State.
• Believing the STR permit ending means no paperwork. The 14% lodging tax registration and remittance still apply.
• Starting operations before the 10 day window closes. Submit the city application at least 10 days before your first day of business.
• Using a P.O. box for the registered agent. Idaho requires a physical street address.
• Skipping the annual report. It is required every year, even though the fee is zero.

What to Expect

If you follow these steps in order, you should be able to form your entity, file any DBA, and submit your city application within a few weeks. Secretary of State processing typically takes about 7 to 10 days from filing, and expedited options may shorten that. The city application should be submitted at least 10 days before you begin operating, so plan your opening date around that window.

For lodging, expect the 14% tax obligation to continue after the permit change, and expect the marketplace or the City Clerk to be the place where you confirm how collection works for your property. Actual timing and amounts can differ from what this guide describes, so confirm the figures noted above before you commit money.

Disclaimer

This article is informational only. It is not legal, tax, or licensing advice. Requirements, fees, and deadlines change, and this guide may not reflect the latest rules. Before forming a business, obtaining a license, or setting up lodging tax collection, confirm details with the Idaho Secretary of State, the Idaho State Tax Commission, and the City of Sandpoint. For complex situations, consult a qualified attorney or CPA.