Get a Business License

Local government entities such as cities and counties raise money by requiring entrepreneurs to obtain business licenses. They don't regulate your business. If you're required to file a Schedule C or other tax form for reporting your business income, chances are you'll be required to have a business license. You'll need to get a license from the city in which you're planning to operate your home business. Simply go to your city or county's website for information and the form you need to file. Often you can apply and pay for your license online.

Home Business and Zoning Laws

Is your home business subject to zoning laws? The answer is: it depends. Go to your local county business offices and ask to see copies of the ordinances that apply to home occupations. Generally speaking, zoning concerns are rarely an issue for home-based businesses because they tend to have few visitors and no outside employees. What may trigger zoning concerns is noise, excessive traffic and/or use of the neighborhood’s parking spaces. One way a business owner can avoid this problem is by negotiating with neighbors and compromising on reasonable hours of operation.

Home-Based Business and Your Lease Agreement

Every lease sets out the general rules and regulations for the lessee including restrictions on starting a business from your home. If your lease doesn't mention it, that doesn't necessarily mean you can open up shop. If your business has the potential to be disturbing to other tenants, such as running a high-volume vacation rental out of your home, it may violate other aspects of the lease. If you are renting a condominium property from the original owner, find out exactly what is stated in the Covenants, Codes, and Restrictions (CCRs). Often times CCRs are more restrictive of home businesses than apartment dwellings. The easiest way to avoid problems with your condo community is to speak to your landlord before beginning a business venture out of your home.

Insuring Your Home-Based Business

Having insurance is always a good idea. You may already have home owner's insurance, but be sure to read your policy to determine what is and is not covered. In some situations you may need to up your coverage. It's better to be protected, particularly if you store large amounts of sensitive data in your home office or have clients come to your residence.

Hiring a Business Attorney

There are many types of business issues that might require a skilled lawyer's help when setting up a home business. You may consider hiring a lawyer if this if you are a first-time business owner or just need a little extra assistance understanding the laws. Business attorneys can help with legal problems before they come up -- such as researching and explaining zoning laws, for example -- but in other instances, consulting a lawyer before a legal issue arises can help you anticipate and prevent serious legal problems.