Checklist for Starting Your Home Business

 By Lesley Spencer, MSc.

Founder & Director of www.HomeBasedWorkingMoms.com

Checklist for Starting Your Home Business. Once you have decided on your home business, you will need to take steps to set it up. The following checklist should help you get your business off the ground.

q     Before you begin your home business, check the zoning rules in your area. Call your city or local government office (usually the planning department, building inspector or zoning administrator) to check zoning rules. Your neighborhood also may have restrictions, such as parking.

q     Decide if you will be incorporated. There are advantages (and disadvantages) of operating under a corporate, rather than sole-trader structure. Talk to a lawyer and check out books on the subject such as, John Kirk, Incorporating Your Business, TPR Publishing. Also decide if you will need patents, trademarks or copyrights on your work.

q     If you will be incorporated, a partnership or have employees, obtain an Employer's Identification Number (EIN) through the IRS (USA only). Also if you have employees, call the Employment Commission for information on unemployment taxes you must pay.

q     Determine if you should charge sales tax on your product or service (by calling the State Comptroller's office in most states of the US).  Australia: you will need to register for Goods and Services Tax if you think you will be earning more than $50,000 per year.

q     Register your business name. In the US, contact your county courthouse. In Australia, you need to speak to the Department of Fair Trading in your state.  

q     Obtain any state or federal licenses if required by your business.

q     Set up your business checking and savings accounts. You may want to deduct a percentage of your earnings to set aside for taxes. Shop around for banks that don't charge monthly fees (such as credit unions).

q     Obtain a separate business telephone line.

q     Order business stationery and cards. If you need small quantities, consider using pre-printed paper.

q     Talk to your insurance company about additional insurance to cover your business equipment, inventory, liability, etc.

q     Meet with an accountant regarding tax and accounting issues. They may be able to point out deductions you may be eligible for and help you better understand tax issues.

q     Keep complete and separate records for your business. Record each sale, invoice, receipt, payroll, expense, etc. Keep copies of all receipts, invoices, cancelled checks, etc. Record your business mileage in a daily log book that you keep in your vehicle.

 Be prepared to start your home business by:

·         Developing a business plan.
·         Making contacts and networking for clients and customers before you begin your home business.
·         Checking on health insurance costs and options.
·         Running your business part-time if you need the security of your job.
·         Have financial resources if needed to carry you through the first several months of starting your business.

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Lesley Spencer is founder and director of the HBWM.com, Inc. Network which includes: the national association of Home-Based Working Moms (http://www.HBWM.com), Mom’s Work-at-Home Kit (http://www.WorkAtHomeKit.com), the eDirectory of Home Based Careers (http://edirectoryofhomebasedcareers.com), Mom's Work-at-Home Site (http://www.momsworkathomesite.com) and HBWM Canada (http://www.hbwmcanada.com). She has a Master's Degree in Public Relations and has been featured in numerous publications including Forbes, Wall Street Journal, USA Today, Home Office Computing, Parenting, Business Start-Ups, Family PC and many others. She has been working from home for over 10 years and has two children ages 10 and 7.