How to start a commercial cleaning business: registration, insurance and bonds

How to start a commercial cleaning business: why the order matters

Most advice on how to start a commercial cleaning business spends its time on logos and pricing. What actually holds up a new janitorial company is paperwork. A property manager won't hand your crew a key ring until your company exists on paper. It also has to bill legally and prove it carries insurance.

Each filing feeds the next one. The legal name on your state filing goes on your EIN, your bank account, your policies and your certificate. If those names don't match, the property manager sends the certificate back and your start date slides.

This guide puts the steps in the order you'll need them. It runs from the state filing to the first night your crew works in a client's building.

Registration: your entity, your EIN and the cleaning business license question

Most states don't license commercial cleaning as a trade. What you need instead is a state filing, a federal tax ID and a local license.

Filing with the state

You form an LLC or corporation through your state's business filing office. Plan to work under a name other than your legal one? Your state, county or city may also require an assumed name (DBA) filing. The SBA's registration guide explains how the filings differ by business structure.

Which structure fits your taxes and personal liability is a question for a CPA or attorney. For insurance, one rule matters: the named insured on every policy should match your filing and your contracts word for word.

Your EIN

An EIN (employer identification number) is your company's federal tax ID. The IRS says you never have to pay a fee for one, and the online application is finished in one sitting. Skip any website that charges to file it for you.

Is there a commercial cleaning license?

In most places, no. You won't sit for a state exam to clean offices or clinics. You'll usually need a general business license or business tax registration from your city or county instead. Names and fees vary, so check with your city clerk or county licensing office.

California is the main exception for janitorial companies. Its Property Service Workers Protection Act covers any business that employs, contracts with or franchises at least one worker who mainly works as a janitor. That employer must register with the Labor Commissioner and renew every year.

The Labor Commissioner's janitorial registration FAQ lists the fee as $500 to register and $500 to renew. Covered employers must also give janitors and their supervisors at least two hours of in-person sexual violence and harassment prevention training every two years. An employer with employees includes proof of workers' comp with its application. Our California page covers the rest of the state's rules.

One filing U.S. companies can skip

Older startup checklists tell new LLCs to file a beneficial ownership information (BOI) report with FinCEN. Companies formed in the United States no longer have to. A March 2025 interim final rule exempted them, and a final rule effective August 14, 2026 adopted that exemption as final. FinCEN's BOI page has the details.

Sales tax on janitorial services

Some states treat janitorial work as a taxable service. If yours does, get a sales tax permit before your first invoice and add the tax to what you bill.

• Texas lists janitorial and custodial work among its taxable real property services. A provider must hold a tax permit and collect tax on its charges.
• Ohio counts building maintenance and janitorial service as a taxable sale, so a cleaning company needs a vendor's license. The law leaves out a provider with less than $5,000 a year in those sales.
• New York taxes interior cleaning and maintenance, whether it's a one-time job or a long-term contract. You need a Certificate of Authority from the Tax Department before you start.

Other states don't tax the service at all, or tax only some of it. Ask your state revenue department or a CPA how your contracts should be billed. This guide only explains that these rules exist; it isn't tax advice. Ohio has a second wrinkle, covered on our Ohio page: comp there comes from the state fund, not private carriers.

Insurance and a janitorial bond before your first contract

Most property managers won't let a crew start without proof of general liability. Many ask for a janitorial bond as well. Buy both before the first bid walk. That way the certificate is ready the week you sign.

General liability

General liability is usually written on the ISO CG 00 01 form. It typically responds when your work hurts someone outside your company or damages property that isn't yours. For a cleaning crew, think of a slip on a freshly finished floor or a chemical that bleaches a carpet. A cart that gouges an elevator door counts too.

Example scenario: your night crew runs a burnisher down a dental office corridor at 9:30 p.m. The cord crosses the hallway. The office manager, working late, trips on it and breaks an ankle. Her claim against your company is the kind of loss GL is meant for, depending on your policy wording.

Janitorial bond

A janitorial bond is a business service bond. It typically protects a client if someone on your crew steals from that client during a shift in the client's building. It's a promise made to your client, and it doesn't pay for your own losses. Employee dishonesty (crime) coverage is the policy that protects your business from theft by your own staff.

The client or the contract often sets the bond amount. A janitorial bond's price usually depends on the bond amount and how many employees it covers, and some bonding companies also weigh your credit or time in business.

Commercial auto

Once a van carries crews, backpack vacuums and chemicals between buildings, ask whether your personal auto policy still applies. Personal policies may limit business use. Many contracts also ask for hired and non-owned auto. It covers your company's liability when employees drive their own cars to a building. See commercial auto for cleaning companies for how that works.

Get a quote for your cleaning business →

Workers' comp when you hire your first cleaner

Each state sets its own rule for when workers' comp is required, and most rules turn on headcount. Here's how five states differ:

• California: every employer needs it, even with one employee.
• Florida: employers outside construction need it at four or more employees, part-time staff included. Post-construction debris cleanup can fall under the construction rules, which start at one employee.
• Texas: carrying comp is optional for most private employers. Those that skip it are called non-subscribers.
• Ohio: you buy comp from the Bureau of Workers' Compensation. State law voids private comp policies, though large employers can qualify to self-insure. A private carrier can still write stop-gap employer's liability for you.
• New York: one employee triggers it, and most employers also need disability and paid family leave coverage.

Paying cleaners on a 1099 doesn't settle whether they're employees. States use their own tests. Ask your state labor department or an attorney before you set up pay.

Comp premium is figured from payroll in each class code. The carrier estimates it at the start, then checks real payroll at an audit after the policy year ends. If payroll grew, expect to owe more.

Your first certificate of insurance for a property manager

A certificate of insurance (COI) is a one-page summary of your coverage, usually on the ACORD 25 form. The property manager wants it before the start date, and it has to match the insurance exhibit in the contract.

Here's what a property manager checks first:

• Named insured matches the company on the contract.
• Limits meet the exhibit for each policy.
• Additional insured status for the owner and management company.
• Waiver of subrogation, which gives up your insurer's right to recover what it paid on a claim from the client.
• Primary and non-contributory wording, so your policy answers before theirs.

Most of these need an endorsement on the policy itself. A line typed on the certificate isn't enough. Read the exhibit at the bid walk. Send it to your agent before you price the job, because some endorsements add cost. Our certificate of insurance guide walks through each box, and the contract requirements guide shows what real exhibits ask for.

Once you're a client, our team can issue certificates on your existing coverage the same day. New endorsements and new bonds take longer, so ask early.

Get a quote for your cleaning business →

What to add as your janitorial business grows

Your first policies fit a small start. Growth changes the list:

• A school district or office tower asks for higher limits, so you add an umbrella.
• Office staff start handling deposits and payroll, so you look at crime coverage.
• Headcount climbs and turnover with it, so you look at employment practices liability.
• You buy an auto-scrubber, so you add equipment coverage for it.

Here's the short version for a new janitorial company. File the business and get the EIN and the local license. Then register for sales tax if your state requires it.

Bind general liability and a janitorial bond before you walk your first building. Add comp at your first hire, and send a certificate that matches the contract. When the first contract is in sight, request a quote. A licensed agent on our team will go over the insurance exhibit with you.