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State Business License Exemption - FAQ

I offer other services such as investment services along with my insurance services. Can I still qualify for the 006 exemption?
My insurance license or certificate of authority issued by the Nevada Division of Insurance has expired or has been revoked. Am I still eligible for the 006 exemption?
Is any insurance company eligible for the 006 – NRS Insurance Company Exemption?
What constitutes a home-based business for the purposes of the Nevada State Business License?
What constitutes a nonprofit entity for the purposes of the Nevada State Business License exemption?
What constitutes a governmental entity for the purposes of the Nevada State Business License?
I am doing business as a Nevada Corporation. Am I eligible for the home-based business exemption?
What is the Declaration of Eligibility for State Business License Form?
What happens if I do not submit the declaration form with my annual list of officers?
Do I need to submit the declaration form if I am not exempt and intend to maintain a State Business License?
Can I file my annual list, claim for business license exemption and the declaration form online?
I received a letter about claiming an exemption last year, what is this all about?
My business does not make a profit, am I not allowed the 002 exemption?
I have a separate shop, but maintain a home office related to my business that I do work out of. Do I qualify for the 003 Exemption?
Do I qualify for the 003 exemption if my business is open to the general public?
Does my Nevada entity qualify for the 003 home-based business exemption if my home is outside the state of Nevada?
I have a corporation, LLC or other Title 7 entity that owns 4 or fewer rental dwellings? Do I qualify for the 004 exemption?
What if I am an LLC or s-corp that is disregarded for tax purposes and treated like a sole proprietorship, could I then qualify for the 004 exemption?
I am an actor or entertainer who performs in motion pictures. Do I qualify for the 005 – Motion Picture Company Exemption?
Am I eligible for the 005 exemption if I am a motion picture studio located in Nevada?

Q: I offer other services such as investment services along with my insurance services. Can I still qualify for the 006 exemption?
A:
No. The 006 exemption is available only for those insurance services regulated and covered by the license or certificate of authority issued by the commissioner of insurance. Those offering non-covered services would be required to maintain a State Business License.
Q: My insurance license or certificate of authority issued by the Nevada Division of Insurance has expired or has been revoked. Am I still eligible for the 006 exemption?
A:
No, only holders of a current license or certificate of authority issued by the Nevada Division of Insurance, who do not have activities not incidental to the licenses or certificate are eligible for the 006 exemption.
Q: Is any insurance company eligible for the 006 – NRS Insurance Company Exemption?
A:
Only those insurance companies possessing a current license or certificate of authority issued by the Nevada State Insurance Commissioner are eligible for this exemption.
Q: What constitutes a home-based business for the purposes of the Nevada State Business License?
A:
A “person who operates a business from his or her home” is a natural person who individually operates or a married couple who jointly operate a business from their personal residence and whose net earnings from the business claiming the exemption were less than 66 2/3 percent of the average Nevada annual wage for the most recent calendar year ending before the date on which the fee would otherwise become due. For 2012, 66 2/3 of the applicable Nevada Average Annual Wage is $26,400.
Q: What constitutes a nonprofit entity for the purposes of the Nevada State Business License exemption?
A:
Nevada nonprofit entities formed pursuant to NRS Chapter 82 and corporations sole formed pursuant to NRS Chapter 84 are specifically exempted from the requirements of the State Business License and are not required to maintain a state business license nor are they required to claim an exemption.

Nonprofit entities formed pursuant to NRS Chapter 81 and unincorporated nonprofit associations that have qualified and currently maintain Internal Revenue Code 501(c) status may claim the 002 – 501(c) Nonprofit Entity exemption by including with its annual list the signed and notarized Declaration of Eligibility for State Business License Exemption declaring under penalty of perjury that they are eligible for the exemption.

Q: What constitutes a governmental entity for the purposes of the Nevada State Business License?
A:
A “governmental entity” is an incorporated or unincorporated agency or instrumentality of the United States government or any state government; a corporation wholly owned by the United States government; or county, city, district, or other political subdivision of a state. Only entities that fall under this definition may claim the 001 exemption.

This does not include contractors that are associated with a governmental entity due to the fact that they have contracted with a federal, state, local governmental agency.

An entity claiming this exemption must include with its annual list the signed and notarized Declaration of Eligibility for State Business License Exemption declaring under penalty of perjury that it is eligible for the exemption.

Q: I am doing business as a Nevada Corporation. Am I eligible for the home-based business exemption?
A:
No. Corporations, Limited-Liability Companies and other entities created or qualified pursuant to Title 7 of the Nevada Revised Statutes are ineligible for the home-based business exemption. The exemption applies only to a natural person who individually operates or a married couple who jointly operate a business from their residence in Nevada.
Q: What is the Declaration of Eligibility for State Business License Form?
A:
The Declaration of Eligibility for State Business License Form is required of all Corporations, LLCs and other Title 7 entities at the time of filing their initial/annual list if they are claiming any exemption from the State Business License.
Q: What happens if I do not submit the declaration form with my annual list of officers?
A:
An annual list of officers, claiming any exemption, must be accompanied by the declaration form. Any annual list claiming an exemption that does not include the declaration form will be rejected and the customer will be informed of the rejection and the reason for such. The entity will be subject to additional penalties if the annual list and declaration form are not returned, in good order by the due date of the annual list.
Q: Do I need to submit the declaration form if I am not exempt and intend to maintain a State Business License?
A:
No. The declaration form is only required if the entity is claiming an exemption
Q: Can I file my annual list, claim for business license exemption and the declaration form online?
A:
No. Online services for entities claiming an exemption are no longer available. All annual lists with a claim for exemption, including the declaration, which must be notarized, must be filed in the office and received by the annual list due date to avoid late penalties. Forms may be found on our website at www.nvsos.gov.
Q: I received a letter about claiming an exemption last year, what is this all about?
A:
Due to the high volume of claims for exemption, the Secretary of State is asking all who claimed an exemption last year to provide information substantiating the claim. It is necessary to respond to this letter even if you feel you were entitled to the exemption and wish to maintain the exemption. Failure to respond to the letter may ultimately result in action being taken against your business entity including suspension or revocation of its charter and its right to conduct business in Nevada or as a Nevada entity. The response to the request must include answers to all the questions and must be signed by an officer of the business entity.

If, upon review, you believe that your entity claimed an exemption to which it was not entitled, you may submit an annual list of officer form and fee, with no exemption claimed, along with any business license fees and associated late penalties. If you do send in the forms and fees required to get your state business license, response to the questions are not required. However, you must provide written response to the office indicating that you have amended the entity’s record so as not to be documented as non-compliant.
Q: My business does not make a profit, am I not allowed the 002 exemption?
A:
Just because your business “does not make a profit,” does not mean it is a “nonprofit” entity that qualifies for the 002 exemption. Corporations, Limited Liability Companies, Limited Partnerships, Limited Liability Partnerships, Limited Liability Partnerships, Limited Liability Limited Partnerships and Business Trusts are considered “for-profit” entities regardless of whether or not they actually make a profit. A nonprofit entity is an entity formed or qualified pursuant to NRS Chapter 82, or pursuant to NRS Chapter 81 or an unincorporated nonprofit association with a current 501(C) status.
Q: I have a separate shop, but maintain a home office related to my business that I do work out of. Do I qualify for the 003 Exemption?
A:
No. The 003 Home-Based Business Exemption is meant to apply to a natural person or that person and his or her spouse that conducts business solely from his or her home. If business is conducted from another location, such as an office or a storefront, the exemption does not apply.
Q: Do I qualify for the 003 exemption if my business is open to the general public?
A:
No. The home-based business exemption is not available to the business owner that maintains a store or other operation that is open to the general public during “normal working hours.” A natural person conducting business in his or her home may invite customers into his or her home to do business and still claim the 003 exemption.
Q: Does my Nevada entity qualify for the 003 home-based business exemption if my home is outside the state of Nevada?
A:
No. The home-based business exemption from the State Business license is not available to a person whose personal residence is outside the the state of Nevada even if the entity may be home-based in the state where it is located because it is considered to be doing business in this state at the registered agent address and this is not his or her home.
Q: I have a corporation, LLC or other Title 7 entity that owns 4 or fewer rental dwellings? Do I qualify for the 004 exemption?
A:
No. The 004 exemption is available only to a natural person owning 4 or fewer dwelling units.
Q: What if I am an LLC or s-corp that is disregarded for tax purposes and treated like a sole proprietorship, could I then qualify for the 004 exemption?
A:
No. The 004 exemption is available only to a natural person. The fact that the LLC or corporation may be treated differently for federal tax purposes does not qualify the LLC or corporation for the exemption.
Q: I am an actor or entertainer who performs in motion pictures. Do I qualify for the 005 – Motion Picture Company Exemption?
A:
No. Unless the primary purpose of your business is to create or produce motion pictures and your business is registered with the Nevada Division of Motion Pictures pursuant to NRS 231.127 through 231.130, you do not qualify. “Motion pictures” includes feature films, movies made for broadcast on television and programs made for broadcast on television in episodes.
Q: Am I eligible for the 005 exemption if I am a motion picture studio located in Nevada?
A:
Yes. If the primary purpose of your entity is to create or produce “motion pictures” in Nevada, you are entitled to the exemption. “Motion pictures” includes feature films, movies made for broadcast on television and programs made for broadcast on television in episodes.