What is generally required for a contractor to establish a legal business entity?

To establish a legal business entity, obtaining a business license is typically a fundamental requirement. A business license grants the contractor legal permission to operate within a specific jurisdiction, ensuring compliance with local laws and regulations. The process usually involves registering the business with the appropriate government body, which may include providing information about the business structure, name, and address.

While having a bank account is essential for managing finances and separating personal funds from business funds, it is not a legal requirement to establish the business entity itself. Similarly, a state certification may be necessary for specific types of contracting work or in certain states, but it is not universally required for all businesses. A tax ID number (or Employer Identification Number) is important for tax purposes and is often needed for hiring employees or filing taxes, but it does not, on its own, establish a legal business entity.

Overall, a business license serves as the primary legal documentation needed to formally start and operate a business, making it the correct answer in this context.