Are you planning on starting a home based business? Here are a few points you need to think about before you take the plunge.

1. Business Licensing

Depending on what state you live in, you may require a license or other agreements in order to run your business. Some areas may need nothing from you until you start earning over a certain income, while some may want to to register your company with the state before you begin conducting any business activities. And yes, this can apply to even home based, internet businesses. Check with your local agencies to see what, if anything, you need to have in place legally in order to get going.

2. Zoning

If your home based business opportunity involves you doing actual, face to face business with members of the public, then you may need to get a zoning permit. Check with your local agencies about what, if any, business activities are limited when they are run out of a residence. Several cities have strict and often confusing local zoning laws, so it pays to speak to someone who can tell you exactly what, if anything, you have to do to be in compliance. If your home based business involves food, for example, you may also need other permits in place.

3. Supplies & Equipment

What do you need in order to launch your home based small business? You must know exactly what you will need, and how much it will cost. For many home based businesses, all you'll need is a computer and net connection. However, depending on what you are doing, you may need special products, software or materials. It's a good idea to write a business plan and include all of the things you have, and the things you need to get, and make up a budget.

4. Area

How much space do you need in your home for your home based business? You may only require office space, but if you want to market and dispatch items you need to make sure you have enough room to store your inventory. To take advantage of tax breaks, you should have an area devoted to your business activities, like a spare bedroom converted to an office. This will let you claim a percentage of your rent or mortgage payments, utilities and other home expenses.

5. Insurance

Finally, find out if you require insurance. In most cases, starting a home based business won't require this, but if you will be having people in your home for business purposes then you may need liability insurance in place. If you have stock, insuring it against damage and theft will keep your business secure.

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