How to Get a Business License in Modesto, California

You’re starting a business in Modesto. You’ve filed your LLC with the state. You have your EIN. Now you need the city business license — and that’s where most guides stop.

Modesto’s process has a specific quirk that trips people up: you can’t get your license without submitting a Stormwater Discharge Compliance Form first. Beyond that, the city runs on a July-June fiscal year, uses a quarterly mill tax system instead of a flat annual fee, and operates through an online portal called BizMod. This guide walks you through the complete chain, from state entity filing through Modesto license issuance.

What Modesto Requires vs. What California Requires

California doesn’t require a statewide business license. You won’t get one from Sacramento, and there’s no statewide “business license fee” you pay to the state.

But Modesto — the city — absolutely requires one. This confuses people because there are three separate layers of requirements, and they’re easy to conflate.

Layer 1: State entity filing. You file your LLC or corporation with the California Secretary of State. This costs $70 for an LLC.

Layer 2: State tax registration. You register with the California Department of Tax and Fee Administration (CDTFA) for a Seller’s Permit if you’re selling goods. This is free. You also owe the $800 California Franchise Tax annually to the Franchise Tax Board (FTB) — that’s separate from Modesto’s local tax, and it hits whether you make money or not.

Layer 3: City business license. Modesto requires a city business license. This is local, not state. It’s what this guide covers.

You need all three. The state license doesn’t get you out of the city license. The Seller’s Permit doesn’t replace it. The $800 franchise tax isn’t a substitute.

The Prerequisite Chain

You need to complete these steps before you can apply for your Modesto business license. Most people do them out of habit, but Modesto won’t issue your license without proof of steps 1–5.

Step 1: Form your LLC at the California Secretary of State.

Go to bizfileOnline.sos.ca.gov and file your Articles of Organization. It’s $70. You can do this online in about 20 minutes. The Secretary of State approves it within 1–2 business days.

Step 2: Get your EIN from the IRS.

Head to irs.gov/ein. Apply for an Employer Identification Number. It’s free. You can get it immediately online (you’ll receive it the same day) or by mail (allow 2 weeks). Most people do it online.

Step 3: File your Statement of Information within 90 days.

California requires you to file Form LLC-12 (Statement of Information) within 90 days of forming your LLC. The fee is $20. File it online at bizfileOnline.sos.ca.gov. If you miss the 90-day window, you’ll owe a penalty and the state may suspend your LLC. Don’t skip this.

Step 4: Register for a Seller’s Permit (if applicable).

If you’re selling tangible goods — retail products, inventory, anything physical — you need a Seller’s Permit from the CDTFA. Go to cdtfa.ca.gov. It’s free to register. Processing takes a few days to a week. You’ll need this when you apply for your Modesto license if you’re a retail or manufacturing business.

If you’re a service business, this step may not apply. Ask yourself: am I selling goods? If no, skip it.

Step 5: Complete the Stormwater Discharge Compliance Form.

This is the step most guides miss. Modesto requires all businesses to submit a Stormwater Discharge Compliance Form before the city will issue your license. This is a regulatory form, not a tax form. It certifies that your business complies with Modesto’s stormwater discharge standards.

You can get the form from the Business Licensing office at 1010 10th Street, Suite 2100, or download it from modestogov.com. Fill it out completely. This form must be submitted before or with your license application. If you don’t submit it, Modesto will hold your application until you do.

Step 6: Apply for your Modesto business license.

Now you’re ready. This is the final step.

Applying Through BizMod Online Portal

Modesto’s online portal is called BizMod, and it’s the fastest way to apply.

Go to bizmod.modestogov.com. Create an account. You’ll answer questions about your business type, location, ownership, and gross receipts. Upload your completed Stormwater Discharge Compliance Form. Pay the license fee (we’ll cover the fee structure below).

The portal accepts payment by credit card or electronic check. Processing time varies depending on your business type — some applications are approved within 2–3 business days, others take a week or more if the city needs clarification.

If you get stuck or have questions about what information to enter, call the Business License office at (209) 577-5389. They can walk you through specific fields or help you troubleshoot technical issues with the portal.

Applying In Person or By Mail

If you prefer to apply offline, you have two options.

In person: Visit the Business License Office at 1010 10th Street, Suite 2100 (2nd floor), Modesto, CA 95354. Applications are available at the office, or you can download them from modestogov.com before you go. Bring your completed application, the Stormwater Discharge Compliance Form, and payment (check or money order).

If you want to schedule an appointment to avoid waiting, call the appointment line at (209) 525-6330.

By mail: Send your completed application, Stormwater Discharge Compliance Form, and payment to:

City of Modesto
PO Box 3442
Modesto, CA 95353

Mail takes longer — allow 1–2 weeks for processing plus mail transit time. If you use mail, use a method that tracks delivery (certified mail or FedEx).

General questions? Call (209) 577-5389.

Understanding the Fee and Tax Structure

Modesto’s fee structure depends on your gross receipts and business type. This is where the quarterly mill tax kicks in.

Home-based businesses under $2,000/year gross receipts: $20 annual flat fee.

Commercial businesses under $2,000/year gross receipts: $35 annual flat fee.

All other businesses: Base license fee plus quarterly mill tax on gross receipts.

The mill tax is calculated quarterly. Modesto uses a “mill” system — one mill equals 0.001 (0.1%). The rate varies by business type:

Commercial retail: ~0.001 (1 mill)
Commercial service: ~0.002 (2 mills)

Here’s how it works: Take your gross receipts for a quarter, subtract any allowed adjustments, multiply by the mill rate.

Example: You run a retail business with $100,000 in gross receipts in a quarter. Your mill tax for that quarter is $100,000 × 0.001 = $100. Over the year, if receipts stay consistent, that’s $400 in mill tax. Add the base fee (varies by business type, typically $50–100) and you’re paying roughly $450–500 annually.

Revenue drops to $40,000 one quarter? Your mill tax drops to $40. This is why the tax fluctuates — it’s tied directly to your gross receipts.

Downtown Improvement District surcharge: If your business is in Modesto’s downtown, you’ll pay an additional surcharge of half the standard mill rate — 0.0005 for retail, 0.001 for service. The surcharge is capped at $1,500 per business per year.

You report gross receipts quarterly and pay the corresponding tax. Modesto will send you quarterly statements, or you can check them on BizMod.

The Stormwater Compliance Requirement

Every business applying for a Modesto business license must submit the Stormwater Discharge Compliance Form. This isn’t optional. This isn’t a recommendation. The city won’t issue your license without it.

Why? Modesto enforces stormwater discharge standards on all commercial operations. Stormwater runoff from businesses can carry pollutants — oil, sediment, chemicals, debris — into local waterways. The form is how the city ensures your business isn’t contributing to that problem.

The form asks basic questions: What type of business are you? What activities happen on-site? Do you handle hazardous materials? Will you have outdoor storage? Are you near a creek or water body?

For most small businesses, the form is straightforward to complete. If you run a service business with an office and no outdoor operations, you’ll check a few boxes and you’re done. If you have a retail storefront with a loading dock or outdoor material storage, you’ll provide more detail.

Get the form from the Business License office or download it from modestogov.com. Complete it fully and honestly. Don’t skip sections. Submit it with your license application — either through BizMod (upload it) or in person/by mail (include it with your paperwork).

If the city has questions about your stormwater practices, they’ll contact you. But in most cases, submission alone is enough to clear this requirement.

Renewal and Fiscal Year Timing

Modesto operates on a July 1–June 30 fiscal year. This matters.

Your business license expires on June 30. Renewal is due by July 31. This is different from the calendar year (January–December) that many other cities use, so mark your calendar if you’re used to annual renewals in December or January.

To renew, you’ll submit a Declaration of Gross Receipts covering the period from July 1 through June 30 of the expiring license year. You’ll calculate your mill tax based on that 12-month gross receipt total, pay the renewal fee, and submit proof of a current Stormwater Discharge Compliance Form.

You can pay online at modestogov.com/1353/Pay-Business-Taxes. This is the same portal where you pay quarterly mill tax installments. Alternatively, you can pay by mail or in person at the Business License office.

Late renewals incur penalties. Don’t wait until August 1 to renew — you’ll owe additional fees. Set a reminder for early July.

If you’re new to Modesto and want a resource beyond government offices, the Modesto Chamber of Commerce is at 1114 J Street, (209) 577-5757. They can answer questions about the local business environment and connect you with other business owners who’ve recently gone through the licensing process.

Next Steps

You now have the roadmap. Start with your state entity filing (LLC at the Secretary of State, $70). Get your EIN (free, same day). File your Statement of Information within 90 days ($20). Register for a Seller’s Permit if you’re selling goods (free). Complete the Stormwater Discharge Compliance Form (free, available from the city). Then apply for your Modesto business license through BizMod, in person, or by mail.

The entire process — from LLC filing to Modesto license in hand — typically takes 2–4 weeks if you move quickly and use the online portal. The Stormwater form is the detail that will save you a rejected application. The mill tax is the detail that means your annual cost fluctuates with your revenue.

Call (209) 577-5389 if you have questions. The staff can confirm your fee tier, explain your specific mill tax rate, and clarify anything about the Stormwater requirement. Start now, and you’ll be licensed and operating within a month.