Chicago home-based businesses may be breathing a sigh of relief after Mayor Rahm Emanuel reportedly relaxed local rules. Chicago Sun Times reports the following changes approved by City Council’s License and Zoning committees as of Feb. 8:
- Home-based businesses can now hire additional employees “provided they ‘work exclusively outside the dwelling unit in connection with the home occupation.’”
- Permission for home-manufactured products to be sold in retail locations.
- Permission to store “incidental, nonhazardous materials” in the business owner’s garage.
- Elimination of the ban on tractor trailer deliveries. However, bulk deliveries can still only be made once per day during regular business hours from 8 a.m. to 5 p.m.
- Elimination of the $330 shared kitchen user fee for licensed mobile food vendors.
- Pushcart license fee now $100, much lower than the previous $350.
While these improvements may be helpful for Chicago business owners, there are still basic rules that must be applied in order to have a successful (and reasonably peaceful) home-based businesses. Obtaining a Driveway Permit from the Chicago Department of Transportation to be able to utilize public sidewalks or parkways as driveways is one of many examples.
What business entity is right for you?
It’s advisable to consult with both a certified public accountant (CPA) and attorney when picking a business entity. If a home-based business owner operates as a sole proprietor, he/she will need to register as a Doing Business As (DBA). Business owners who wish to operate as a corporation need to file articles of incorporation with the Illinois Secretary of State. Limited Liability Companies will file Articles of Organization with the Secretary of State. Partnerships are formed by default when two or more people agree to partner to conduct a business. It is advisable for members of a partnership to form a limited partnership or limited liability limited partnership with the secretary of state.
Do you need a business license?
Home-based business owners should research whether they need a business license to operate their specific business. For example, a professional baker who bakes in his/her home is required to obtain a business license under Illinois Cupcake Law.
What types of business contracts do you need?
The types of contracts a home-based business owner needs vary. If the home-based business is an LLC, the members will want to sign an operating agreement. An operating agreement details how profits and losses will be split, how the LLC can be terminated and other important terms. If the home-based business has employees or independent contractors, certain contractual agreements will be necessary.
Have more home-business related questions? Contact J. Paye & Associates today.
Shamontiel L. Vaughn contributed to this blog. Find out more about her at Shamontiel.com.
The information contained here is intended to provide useful information on the topic covered but should not be construed as one-size-fits-all legal advice. Speak to an attorney specifically about your contractual agreement for specific terms and conditions.