Starting a craft selling business in Vilonia, AR: which licenses and registrations do I need?

The owner wrote: “I am a maker of toys made with yarn at my home. I will buy new yarn from Hobby Lobby and other craft stores, and I will sell at craft fairs, locally in Arkansas, and in surrounding areas.”

Congratulations on Crafty Sunflower Girl! Yarn and supplies cost little, and selling face to face at markets lets you learn quickly what customers love. Below we walk through the three things every new business in Arkansas sorts out (structure, tax IDs, and licenses) and then sum it all up.

Crocheted or knitted toys meant for children fall under federal children's product safety rules, so you'll need tracking labels and attention to small parts like safety eyes, which are a choking concern for little ones. An Arkansas sales tax permit covers your Vilonia and in-state craft fair sales, while fairs in neighboring states may require their own temporary permits. Give Hobby Lobby a resale certificate so you don't pay tax on yarn that becomes inventory.

What Crafty Sunflower Girl needs

1. LLC (business structure) – Forming an LLC puts a legal wall between the business and your personal assets. If a child chokes on a small button eye from a stuffed toy, an LLC helps keep that serious claim from reaching your home.
2. DBA (doing business as) registration – If you operate as a sole proprietor, or under a name different from your LLC's exact legal name, registering "Crafty Sunflower Girl" lets you use it on signs, invoices, and your business bank account.
3. EIN (federal tax ID number) – You plan on 5 employees, so the federal tax ID number (EIN) is required for payroll, and you will also use it for the business bank account and supplier accounts.
4. Arkansas sales tax permit (seller's permit) – You will be selling taxable goods, so register to collect sales tax before your first sale. It also lets you buy inventory for resale without paying tax on it.
5. Arkansas employer ID – With 5 employees, you need a state employer account number for payroll withholding and unemployment insurance. It works like the EIN, but for state payroll taxes.
6. Business license – Most places require a local business license to operate, including home-based businesses. Check the rules where Crafty Sunflower Girl will operate in Vilonia, and ask about home occupation and zoning rules if you work from home.
7. Children's product safety testing – Toys and items made for young children must meet safety standards and may need testing and a certificate before sale.

By the numbers: Banks, insurers, and tax forms will ask for your industry code. For a craft selling business it is NAICS 339999 (All Other Miscellaneous Manufacturing). With 5 employees planned, you are already creating jobs in Vilonia. That makes 7 items on your list.

Tip: Ask each fair about vendor permits and how sales tax is collected before you book your table.

To recap: Crafty Sunflower Girl in Vilonia, AR needs an LLC, a DBA, an EIN, a sales tax permit, a state employer ID, a business license, and children's product safety testing. Handle these early and the business starts on solid ground.

BusinessNameUSA can prepare and file these registrations for you: start your order.