Home business success, keeping it legal is crucial!

Keeping Your Home Business Legal.....A Critical Step Towards Continued Success!

If you’re going to start running a home business, there are numerous laws you need to be aware of.

If you don’t check things out before you start, then you risk having your home business shut down by the authorities.

The first important point to keep in mind is that running your business from your home does not mean that you are excluded from certain permits or licenses that your city or state may require.

Though you can probably get away with it for a short period of time my advice is to treat your business the right way from the very beginning and put it on a firm foundation.

The first thing that you need to do is go straight to your local city office and ask as many questions as possible about what paperwork you will need to make your home based business legal.

Instruction booklets designed for new businesses are often available at no cost. These informative guides will direct you to all of the necessary forms that you will need.

Below are some of the most familiar types of licenses and permits that you may encounter as a requirement for operating your home based business.

Again, these licenses are the typical standard of most city and county areas. They may or may not apply to you.

Regardless of the licenses that you need to obtain you should be able to get any of them fairly easily. When operating a home based business it is really pretty easy to make it legal.

Simply put taking a little time now to do it right can save you serious potential headaches in the future.

After all, wouldn't it be a shame to put that much of your time and money into building a successful home business, really get it rolling just to be shut down because you didn't take the time to fill out the necessary paperwork?

Sellers Permits

Sellers permits are required if you are selling goods that are taxable. If your state does not charge a sales tax then you probably do not have this requirement.

Business License

Depending on the county you live in this very standard license requirement is a basic necessity for all businesses that are entering the market.

Food Permits

Food permits are self explanatory – in other words you must have this completed if you are handling and serving food in any way as part of your daily business. If you have a catering home business then this is especially important.

Zoning Permits

Many city zoning restrictions make it illegal to have visitors come to your home for 'business' in a residential area without a permit similar to the Zoning Permit. Check with your local and state laws to determine how these may impact your home based business.

More On Zoning Laws

The chances are that the different parts of your town or city have been split into different ‘zones’. Each one of these zones has a purpose: business or residential.

Since you almost certainly live in a residential area, zoning laws restrict what you can do there in terms of business.

If you think about it, there are many good reasons for this.

What would it be like if someone could just decide to buy up a whole neighborhood of houses and turn the area into a shopping mall, without getting anyone’s permission?

What if your neighbors could just turn around one day and start using their house as a shop?

I doubt that you’d like that.

The laws are there to protect your neighborhood, and to stop businesses from interfering with people’s home lives.

You should phone whatever local governmental body there is in your area, and ask them about the specific zoning laws in your area.

If they’re not very helpful, it could easily be worth a visit to a lawyer. Though I really doubt that you'll find that necessary.

The point is you’ll find that laws vary massively – here are some of the things you might come across.

The Strict Zoning Policy

Many areas still operate a strict ‘no-business’ policy in residential areas, and will come after you if you start a business without their permission.

In this case you’ll need to put in a formal application, and there could be a public hearing, giving other residents the chance to object.

Time to start being nicer to your neighbours!

You should also note that just because there are other home businesses in your area, it doesn’t mean that you’ll find it any easier to get permission.

The rules may have been tightened up since those businesses were started. Still, it’s worth talking to the other home businesses in the area, if you can, to see if they can give you any advice.

Percentage Policies

Another common way of handling things is to allow you to use only a percentage of your house for business, to avoid residential properties becoming wholly commercial.

You might be told, for example, that only 20% of the house can be used for business purposes.

This can be restrictive if you have a small house, or if you need to store things. To make things even more restrictive, areas with a policy like this are usually completely unwilling to vary it for you.

Restrictions by Industry

It’s worth checking to see if there is a special exception in the zoning laws for what you plan to do with your home business.

Artists, for example, are often excluded from the laws (where are they supposed to work – the art office?), as well as people who tutor from home, like music teachers. Doctors and dentists are another common exception.

Signs and Traffic Rules

You might find that the laws have special restrictions on signs and traffic.

You could be restricted from putting anything on the front of your house that could be considered ‘advertising’, meaning that you can’t even have a sign with the name of your business.

If you plan to have trucks making deliveries to your house, then that can pose a big problem, especially if someone complains about them, or there are lots of children in the area.

Visitor Rules

Another potential issue of concern is visitors. For some reason, people get upset if lots of visitors keep coming and going from your house – they like their street to be quiet, not constantly busy.

Some laws allow only a set number of visitors to your home business per day, or restrict the number of visitors that you can have at one time.

Avoid Breaking the Law

A footnote to all this is that millions of businesses are operated illegally out of people’s homes, in violation of the relevant laws.

They try to keep their home businesses secret, because they know that admitting what they’re doing would probably get it closed down.

This approach obviously isn’t recommended though as you should always try your best to do things legally, and consider moving if no-one seems to want your home based business in the area.