Business Strategies

Working from home is a common way to start a business. Low overhead and flexibility are real advantages, but a home-based business still has legal, tax and practical obligations. A little planning at the start avoids headaches later.

Check the Rules Where You Live

• Zoning and local restrictions. Some cities, counties and homeowners associations limit customer visits, signs, employees or deliveries.
• Licenses and registrations. Local business licenses, state registrations and professional licenses may apply, even if you work from a spare room.
• Lease or HOA terms. Renters and condo owners should confirm their agreements allow business use.

Choose a Structure and Separate Your Finances

Decide whether you will operate as a sole proprietor, an LLC or another entity; see our formation page for guidance. Open a separate business bank account and avoid paying personal expenses from it. Clear separation makes record-keeping easier and protects any liability shield the entity provides.

Insurance

A standard homeowner's or renter's policy often limits or excludes business property and liability. Ask your insurer about a rider or a separate business policy, especially if clients visit or you keep equipment and inventory at home.

Taxes to Plan For

• Income tax and self-employment tax on net earnings, generally paid through quarterly estimates if you have no withholding.
• Sales tax if you sell taxable goods or services; check with the Georgia Department of Revenue at dor.georgia.gov.
• Payroll taxes if you hire employees.
• Home office deduction if you meet the requirements, which generally center on regular and exclusive use of part of your home for business.
• Deductions for supplies, equipment, software, phone and internet, to the extent used for business.

Good bookkeeping makes all of this easier; see our bookkeeping services.

Set Up a Workable Workspace

A dedicated area helps with both productivity and tax records. Keep business papers and equipment organized, and protect client data with secure passwords and backups.

Manage Your Time and Boundaries

Working at home blurs lines. Set regular hours, tell family and friends when you are working and make time to rest. Isolation can be a challenge, so consider networking groups or coworking sessions.

Plan for Growth

If you outgrow the house, consider the costs of leased space, additional insurance and changes in your tax situation. Keep an eye on when it makes sense to hire help or outsource tasks like payroll.

Do Not Forget Retirement and Health Coverage

Without an employer, you are responsible for both. Explore retirement plans designed for the self-employed and health coverage options at healthcare.gov.

If you are starting a home-based business, contact us and we will help you set it up properly.