Business Card, Drop Cards, Sizzle Cards

Q:  A friend of mine currently works as a painter for a company. He would like to start his own business later on and for the moment he wants to pass out business cards (stating only his name, what he does, and his contact information). Someone told me the IRS investigates and if there is no license he could be in big trouble, is this true?  I guess the real question is what does he need to work legally as a painter? (contractor’s license, insurance?)

A:  It’s not the IRS that investigates, it’s your state’s contractors licensing board.  I know in the state of CA, it’s illegal to contract without a license when the job is more than $500.  Your friend needs to get online and check it out.