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For those entrepreneurs who are passionate about teaching, starting a school or other educational institution might be a good fit. Whether it’s a private elementary school or postsecondary institution, any type of educational endeavor you start will need an educational institution license first.

Why Do I Need to Be Licensed?

Without regulations for education, every school would be at a different level in terms of curriculum and teaching methods. An educational institution license ensures that your state’s Higher Education Department (as well as its business licenses, permits & tax departments) has reviewed your school’s curriculum and agreed that it meets its requirements before you start a business.

Keep in mind that having this business license does not mean your school is also accredited. You may need a separate license for that process. Just know that you can’t advertise it as such without the appropriate approval first.

Who Needs an Educational Institution License?

Not sure if you qualify as needing a business license to operate your institution? If you’re involved in any of the following types of education, you likely do need an educational institution license:

  • Academic organization, including primary, secondary, and postsecondary
  • Community college and university
  • Vocational school
  • Technical school
  • Business or professional school
  • Nursery or preschool
  • Art training
  • Career training
  • Medical assistance training
  • Truck driving school
  • Culinary school
  • Online education program

If your school offers a program where students can graduate or receive a certificate or diploma, you need a business license.

What Happens if I Don’t Get an Educational Institution License?

You’ll risk serious penalties and fees, and could be shut down. In New Mexico, for example, unlicensed institutions can be fined up to $500 per day, per violation. That adds up fast! Be safe and get your license before you open your doors to students.