If you think you can simply start any home-based business without Uncle Sam’s approval, think again. Making the assumption that you can start a home-based business freely can be one of your worst mistakes.
The Gainesville Sun newspaper recently reported that a Gainesville, Florida man is in trouble for starting a dog sitting business from home. Bruce Baber has operated a dog sitting business in his home in the last four years. The business is his sole source of income, with a steady stream of clients averaging about 10 dogs a day.
Unfortunately, neighbors complained about the dogs’ barking and reported him to the neighborhood association and to the city. Once he was reported, the city officials started scrutinizing his business and found him to be violating animal control laws and home-based business regulations. Baber was given until June 23 to cease operations for his dog-sitting service.
Like many home business owners, Baber “had no idea” that a permit is required to run a home-based business, or that there are rules on how he can operate the business. Gainesville’s rules and code requirements for home-based business permits are:
- Confined to principal building.
- No more than one employee other than residents.
- No visible evidence, product display or change to appearance visible from outside.
- Limited to 20 percent of total floor area, maximum of 500 square feet.
- Additions cannot be used for the business for two years after completion.
- No goods can be sold on the premises.
- No more than one automobile used for the business can park on site, no larger than a quarter-ton panel or pickup truck.
- Clients or suppliers are limited to two vehicles concurrently or no more than 10 per day.
- The home business shall not be open to the public before 7 a.m. or after 10 p.m.
Baber was in violation of the rule that restricts vehicle visits to no more than 10 a day (10 dogs = 10 cars dropping off the dogs in the mornings + 10 cars picking up the dogs in the afternoon/evening). Plus, since his home-based business involves animals, Baber was also found to be in violation of the animal code, which does not allow people to keep animals other than their own pets in a residential district.
As Baber is finding out, it is better to be on the safe side of the law when it comes to your business, or you risk losing everything. The last thing you want is to be in Baber’s shoes, whose world has been turned upside down with the risk of losing his only source of income.
To ensure that your home business follows the regulations, here are some things you need to consider.
1. Learn the rules. Ignorance is never an excuse for breaking the law. Take time from your busy schedule to go to your local county or city clerk’s office to know what rules are governing your home-based business. Check with your homeowners association (HOA) what pertinent regulations could affect you.
Also research how strictly your local government or HOA enforces the rules. Do they regularly check out neighborhoods, or do they enforce home occupation ordinances only when someone complains?
Hence, you need to be proactive and know what you are up against now – before you start or when you are just starting – rather than getting a surprise visit from county/city officials with a letter demanding that you cease operations of your business.
2. Consider the neighbors. Many home-based businesses, even if they knowingly or unknowingly break zoning and city/county regulations, fly under the radar UNTIL a neighbor files a complaint. It just takes one complaint from a neighbor for the city/county officials to start scrutinizing your business.
What could set off your neighbor and file a complaint? It could be anything really. In dog sitter Bruce Baber’s case, it is the loud barking of the dogs. For others, it can be the coming-and-going of customers. There are also cases of neighbors filing a complaint because of the multiple visits per day of shipping and delivery carriers. It could even be the magnet decal that you put in your car to advertise your business. Whatever it is, you need to consider the complaints of your neighbors before it escalates and they feel that their only choice is to report your business to the authorities.
In planning the business, think how it can affect your neighbors. Some home-based businesses are more likely to impact the neighbors than others. A mommy blogger writing about the exploits of her young kids may fly under the radar of neighbors. But a daycare business or a pet sitting business like Baber’s has noise elements in addition to traffic considerations. Home-based businesses that have external effects, such as noise or storage of hazardous materials (that can blow up the neighborhood) are typically restricted. Zoning laws also typically restrict home businesses that can affect the traffic flow in a neighborhood; as well as those home businesses that require physical changes to the homes in order to conduct the business.
3. Beware of busybodies. In a neighborhood, there always seems to be at least one person whose main goal in life is to be the enforcer of rules. These busybodies go around and keenly observe what’s happening in the neighborhood to ensure that the rules are being followed. They know the rules to the last letter, and may know the county clerk’s office telephone number by heart. You don’t have to offend them; they just need to see that you are breaking the rule.
Not much you can do with these people, except to make sure that you know the rules and you follow it to the letter. And oh, to the extent that you can, investigate prior to purchasing the house or leasing the apartment if any busybodies live in the neighborhood.
4. If purchasing a house or property, check the home business laws in the area. If you are planning to buy, move or rent into a new area, be sure to check the zoning rules governing home-based businesses prior to buying or leasing the property. Take a look at the HOA regulations. Your ability to run your business should be an important factor in selecting properties. Choose properties where you can run your business without the threat or risk of getting a cease-and-desist order.
5. Use a private mailbox service. If you are expecting a lot of pickups and deliveries, minimize the comings-and-goings of vehicles by having an alternative location such as private mailbox or P.O. box service.
6. Hire a virtual assistant. Many areas restrict the number of employees working in the home (in some, they prohibit employees altogether). Instead of hiring an employee to work in your home, consider hiring a virtual assistant who can work for you from their own homes.