You might luck out and slip by however there are private contractors who specialize in finding just such operations. Municipalities across the country contract with them to recover lost sales tax and other monies. These businesses routinely scan and cross check various data bases and are extremely effective at sniffing out stealth business operations. I only know this because a relative created the first such agency and tried to recruit me as one of his foot soldiers. He was so successful that the business he founded on his living room couch was purchased buy a large national corporation for about 35 million dollars. I'd stay as legal as possible and sleep soundly.
It doesn't matter in my case-there are no special permits or anything else I need other than filing Schedule C each year. I'm already as legal as I can be for what I'm doing, which honestly isn't much. I'm not handling hazardous materials, food, dealing with the general public, or doing anything else subject to a plethora of regulations. Even as a corporation the only thing I remember being bothered for that I didn't know about was some kind of biennial state fee of a few tens of dollars every other year. California seems to have really restrictive business laws compared most other places, even New York. I remember that from when I researched this stuff in the early 1990s. NYS just has a lot of taxes. There is a form for NYC unicorporated business tax but that only applies if you make more than $75,000 annually-obviously not applicable to me, nor would it likely be at any time in the foreseeable future. In fact, I unincorporated precisely because the benefits (i.e. mostly avoiding Social Security tax but there were a few others) were worth less than the extra expense, paperwork, and showing up on more radar screens. On another note, the minute I have to jump through a million hoops, or pay hundreds annually in permit fees, just to make the small amount I do I'll stop doing it entirely, and apply for welfare.
I also think your friend's business mostly sniffs out the medium size businesses making perhaps the equivalent of a good salary, but still small enough to mostly stay off the radar (think eBay businesses selling perhaps a few hundred thousand a year). The government can recover large amounts of money from those relative to the effort they put in. A few thousand a year business on the other hand, at best you'll get a couple of hundred in self-employment tax. You're not even near the threshold where the regular income taxes kick in. Very little to recover even if there is wrongdoing, and often the person is too broke to pay anything even if they catch up with him/her.
BTW, what on earth is the purpose of a fictitious business name as gadget_lover mentioned? I had to pick one when I was a corporation even though my corporation had a real name which I used for business purposes. I never used the fictitious name, nor really saw any reason for it. However, NYS seems to have sold the name to advertisers because I've gotten a lot of junk mail with the fictitious business name until it more or less stopped a few years ago. The name the advertisers used could only have come from NYS since I never once used the fictitious name in any way, shape, or form. I still have all the junk they sent me just in case I find a good lawyer. Can I sue them for selling my info like that? I can tell you that the first time I saw junk mail with the fictitious name there was steam coming out of my ears.
To the OP:
Thinking about this topic some more, an electronics repair license sounds like something a TV or computer repair shop dealing with the general public might need, not a guy working out of his garage by word of mouth. Let us know what you find out. I'd honestly be really surprised if you had to have anything on your list for what you plan to do.
