So you’ve got an idea for a home business, but you just aren’t sure how to get started. Here are five steps you need to follow before taking the plunge.
First, if you’re not great at bookkeeping, you’ll have to either take a community education class or hire someone to help you with your accounts. Accounting is an important part of any home business, so don’t take this duty lightly. Also consider if you’ll need to hire anyone else for help, such as a secretary or an attorney. Both are important if there are legal contracts or multiple large accounts involved.
You’ll need to set up the space for your home business operation. Keep in mind that the IRS has very strict requirements as to what constitutes a home office, so you’ll need to follow the IRS guidelines if you want to take a home office tax deduction. You may also need a zoning permit, depending upon the nature of your home business.
Determine what kind of business rules you will legally fall under. Now is the time to decide if you’ll be an LLC or a sole proprietorship. The IRS website has more information on both of these. This is also the time to make a call to your home insurance agent. Because your home business is different than your house, you may actually need to take out a small business insurance policy, just to keep everything legal.
Finally, you’ll need to set up a website to legitimize your operation. No home business is taken seriously in the modern world without one. That includes you!
By following these quick steps, you’ll be on your way to running your very own home business. If you get stuck along the way, you may need to hire an attorney on an hourly basis so that you don’t get stuck in any legal entanglements. It’s always better to get everything right first time than to risk the reputation of your new business.