Are You a Home Office Outlaw?

Your home office may not be legal and you could face fines or criminal charges. Here’s what you need to know about zoning laws before you start your business.

Thinking about working from home? Before you do, check the zoning laws to find out whether home businesses are allowed in your community.

Although there are now estimated to be more than 39 million people who work part- or full-time from home, outdated zoning laws on the books of many communities in the United States still forbid the operation of a home business. Where home businesses are allowed, laws generally limit the type of business, the number of nonfamily employees allowed on the premises, and even the amount of space (as a percentage of total square footage) that can be used for home businesses.

Many home businesses, therefore, knowingly operate in defiance of the law. And, zoning board officials sometimes admit that they do nothing to enforce the laws unless the business owner makes the business highly visible or unless someone lodges a complaint.

Once a complaint is lodged, however, the home business owner can be subjected to fines and is expected to close down operations immediately. Failure to abide by the law after being warned or fined can lead to criminal charges and possibly even jail.

Although jail sentences for operating a legitimate business at home are rare, they do happen. On Long Island, New York, a man learned that the hard way when he was sentenced to 30 days in jail for teaching swimming in an indoor pool in his home.

A certified water instructor, the man had been teaching swimming in his home for two-and-a-half years, gradually developing a word-of-mouth reputation that attracted children and adults to his classes. But then, a neighbor complained to town officials and the swimming instructor was fined $500 for running a commercial business in a residential area.

Despite the fine, the instructor kept giving swimming lessons in his home. The neighbor complained again, and this time the instructor was jailed for 30 days and fined an additional $750.

You don’t have to run a swimming school at home or have numerous customers or employees coming to your house to run amuck of antiquated and arbitrary zoning laws. Mailing list services, daycare, telemarketing, computer consulting, public relations, and direct selling operations all may be illegal, depending on where you live.

Consider the laws in Islip, New York. There, it is permissible only for physicians, lawyers, architects, engineers, dentists, accountants, dressmakers, milliners, tutors, and babysitters to work at home. Babysitters can care for no more than two children at a time for a maximum of 12 hours. Pursue any other occupation from your home, or have a parent with three children bring the children to your home for daycare, and you become a scofflaw — unless you get the zoning board to grant you a variance. (A variance is a legal term for making you an exception to the law.) You’ll get the variance only if your neighbors don’t object to you working at home, the zoning board approves, and you pay a $150 variance fee.

Change in the Wind

Slowly, ever so slowly, communities are starting to take a closer look at their zoning laws and make at least some slight changes in zoning laws. Most often these changes involve expanding a list of “acceptable” home occupations. Occasionally, they go further.

In Fairfax County, Virginia, for instance, the Board of Supervisors voted not long ago to allow home-based businesses to have one non-residential employee working in the home.

But change doesn’t come easily. Chief among the reasons are concerns regarding property values and integrity of residential neighborhoods. Where, after all should a community draw the line between which businesses will be allowed at home, and which are too commercial, too smelly, too noisy, too dangerous, or too much of an eyesore to be operated from a home? Should a plumber be prevented from working from home — or from parking his van (lettered with his business name) in the street because it makes the neighborhood look too commercial? Does a business that gets a lot of express mail and package deliveries cause enough traffic to disturb a neighborhood?

Or, what about selling used cars from home? Or selling and repairing guns? Or running a dance studio, or — like the Long Island man — a swimming school.

Avoiding Problems

So, what can you do to avoid run-ins with the law?

Fighting zoning laws after the fact is costly and can destroy your business. One Maryland couple reportedly spent nearly $10,000 in legal fees and lost half their business income due to the time they spent battling zoning regulations.

Therefore, your best bet is to find out what the regulations are before you start your business. If the regulations won’t allow you to conduct the type of business you would like to from your home, find out if special permits or variances are obtainable and at what cost.

Other ways to minimize the potential for problems include:

Stay on good terms with your neighbors. You don’t have to be buddy-buddy with them, but be considerate and polite.
Try not to make your business too obvious. If you drive a van or small truck for your business, park it in your garage to keep neighbors from thinking you are making the neighborhood look too commercial.
Obey any rules regarding the number of cars parked on your property
Try to visit clients rather than having them come to you
Keep use of noisy machinery to a minimum
If your business outgrows your home (or the laws governing the use of your home) consider moving to or leasing space in some other part of the same town that is commercially zoned.
Work to get the zoning laws in your community changed
If you get frequent deliveries (and no one else in your neighborhood does) investigate having the shipments sent to a mail receiving service such as Mail Boxes, Etc. or make arrangements with a business owner located in a commercial zone to accept shipments for you.

By Janet Attard. Note: Parts of this article first appeared in Nautilus CD Magazine.

Disclaimer: The content on this page is for informational purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.