The Legalities of Running a Business in Your Home

by Joseph Demasi

There is much enjoyment to be had in running a home business, but did you know that there are also quite a few legalities you will need to keep in mind? It is true, you will not be able to simply open up your doors and hang out a sign. As a matter of fact, depending on the business you are running in your home, there are probably a number of rules and regulations you will need to follow.

For example, if you are planning on opening a home day care business, you will need to have a license to operate. This will mean that a city inspector will come in and take a look at your residence to make sure it meets the safety codes and rules that your city and state has set forth for such home daycare centers. Additionally, you will need to permit occasional visits from the overseeing government agency to ensure you are still up to code.

If you are living in a covenant controlled community, you will need to dig up the bylaws of your homeowners’ association and take a look about what it says with respect to home based businesses. Some associations do not permit businesses to be run out of homes within their vicinity, while others only limit the kinds of business you may engage in or the hours of operation.

If you are not under the auspices of a homeowners’ association, you will still want to check in with the zoning commission to make sure that your proposed home business will not violate any zoning laws in your area. The same is true for signage. While you will need some signs that advertise the location of your business, you need to find out what the neighborhood and city limitations are. This may pertain to size, color, and also placement of any sign.

Other legalities to observe include insurance issues. For example, if a customer were to enter your home business location and fell in the course of doing business with you, your homeowners’ insurance will probably not cover any of the injuries she or he sustains. You will need to contact your insurance company to find out if you need a special waiver, rider, or a different policy altogether.

While these legalities may appear to be a wrench in your home business, do keep in mind that they are designed to protect you, your customers, and everyone else doing a similar kind of business. Adhering to certain standards and obtaining licenses and permits will actually give you a leg up with the competition, since you can show how your business is superior to anyone else’s – simply by displaying your licenses and permits. As a matter of fact, you could say that the legalities of running a business in your home make for great marketing tools!

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