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Start Your Own Business : The Only Start-Up Book You'll Ever Need
Entrepreneur's Ultimate Start-Up Directory : Includes 1,350 Great Business Ideas
Business Know- How : An Operational Guide for Home-Based and Micro-Sized Businesses With Limited Budgets
The Home Office and Small Business Answer Book : Solutions to the Most Frequently Asked Questions About Starting and Running Home Offices
The Complete Idiot's Guide to Starting a Home-Based Business

 

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21 Steps to Starting a Home Business

If the idea of working from home is appealing, but you do not know where to begin, this feature series is a comprehensive step-by-step guide to help you achieve success in your home-based endeavor.

by Isabel Isidro
Managing Editor 

Decide What Part of the House to Use 
Determine How Much Time You Can Spend on the Business 
Decide on the Type of Business
 
Choose a Legal Form 
 
Determine Where the Money Will Come From 
 

Gather Information 

Check on Zoning Restrictions
 

Pick a Business Name and Register It
 

Write a Business Plan
 
Get an Identifying Number
 

Obtain a Sales Tax Permit
 
Obtain Licenses and Permits 
Select Business Cards, Stationery, Brochures
 

Open a Business Checking Account
 

Set-up Record-Keeping Systems
 

Check IRS Requirements 
 
Outfit the Business 
 

Decide on Telephone Requirements
 
 
Check Out the Post-Office and UPS
 
 
Purchase the Necessary Insurance
 
Organize the House and Yourself

Step 6. Gather Information

Lay the groundwork by gathering more information about your particular business and researching your potential market.  Spend a few weeks researching home-based businesses. Colleges, universities, vocational schools and professional groups may be sources of education about the business that you want to enter.  A library or bookstore can provide numerous books on business basics to aid you in the course of your own home study. Some would-be entrepreneurs even sign up for internship or apprenticeship opportunities to train themselves in running the business and learning the procedures they can later adopt.  (Read our detailed article on this topic)

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Step 7. Check on Zoning Restrictions 

Check if zoning approval from the local municipal authorities is necessary for your business. Find out how your property is zoned, then call your City Hall and ask what regulations apply to home businesses in that zone. Also, if you rent or live in a condominium, check the lease or homeowner's association rules to be certain a home business is allowed.

Also, it is important to know of any neighborhood restrictions regarding shop noise, chemical usage, odors, signage, deliveries, traffic or parking, or any other deterrents from running a business at home. Know what you can and can’t do right from the very start; complaints from your neighbors may result in your having to close down.  (Read our detailed article on this topic)

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Step 8. Pick a Business Name and Register It

Your business name is your first opportunity to make an impression on potential customers. If the business you choose is different form your name, file an assumed (or fictitious) name certificate with the county. You are notified if another business already has that name, so you can select a new one.

Do this before investing in expensive stationery and brochures. It costs only a few dollars to file, and it protects the business name from being used by someone else in the county.  (Read our detailed article on this topic)

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Step 9. Write a Business Plan 

A good business plan serves as a blueprint for your new business as it helps clarifies your ideas and establishes a plan of action. A good business plan should include a description of what you are selling, your background and qualifications, who the prospective customers are and where they can be found, what is needed to build the business, how you plan to promote, and how much money is need for start-up costs.  (Read our detailed article on this topic)

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Step 10. Get an Identifying Number 

If you are the sole proprietor of the business and have no employees, you may either use your Social Security number or an Employee Identification Number (EIN) as the business number on

official forms. If you have employees, or the business is set up as a partnership or corporation, you must obtain an EIN. To do this, complete IRS Form SS-4 (Application for Employer Identification Number) and file it with the nearest IRS Center.  (Read our detailed article on this topic)

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Step 11. Obtain a Sales Tax Permit 

If the product or service you sell is taxable, you need a state sales tax permit. Call the local tax agency, explain the type of business you have and what you sell, and ask if you need to collect sales tax. If you do, they will send you the necessary information and forms to complete. You also use this tax number when your purchase items for resale.  (Read our detailed article on this topic)

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Step 12. Obtain Licenses and Permits

Make sure that you investigate legal requirements thoroughly. It is very important not to overlook any necessary license or permit. Laws regarding licensing and certification are area-specific and usually differ for various kinds of businesses. For example, some cities and counties require a general business license, and most have special laws regarding the preparation and sale of food.

Call City Hall to find out what is needed for your particular business and situation. In addition,  you may also wish to check on your local Chamber of Commerce for information on city, county and state licenses and permits.  (Read our detailed article on this topic)

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Step 13. Select Business Cards, Stationery, Brochures

Spend time on the color, design and paper for these items. They make a definite impression-good or bad- on the people who receive them. If you are not certain what is most suitable and effective, consult a graphics designer or a creative printer whose work you like.  (Read our detailed article on this topic)

 

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