Submitted by STintern1 on Wed, Apr 11th at 6:06 pm
Courtesy of NOLO, Legal Encyclopedia.
The Home or Hobby Business: An Overview
How to improve your chances of success when starting a home business
Home business is booming, and so is craft and hobby business. Craft work is a $13 billion dollar industry in the United States, and crafts artisans now average $76,000 in annual sales. Even better, the tax code is full of deductions for businesses -- and you are entitled to take them whether you work from home or from a studio space.
Besides the financial opportunities, there are many reasons to pursue a home or hobby business. Perhaps you seek artistic freedom or are driven by a desire to love what you do. Maybe your family obligations require you to have a flexible schedule or to travel less. Possibly there's just no more shelf space for your ceramic creations and your spouse thinks it is time for you to start sharing them with the world.
Whatever your goals, there are some basic things you can do to improve your chances of success, and make sure you're running a safe and legal business.
- Get up to speed on business basics. If you're taking money for your art, you're in business. Make the most of what you earn by operating your business like... a business. Nolo's book, Running a Side Business: How to Create a Second Income, by Richard Stim and Lisa Guerin, will help you start off on the right foot.
- Write a business plan. It doesn't have to be complex or formal, but putting your ideas on paper can help you test their viability and improve your chances for success. It can also give you a clear idea of how you want to work with sales channels and whether you need professional advisors or potential helpers such as contractors or employees. Nolo's How to Write a Business Plan, by Mike McKeever, will give you coaching and templates. If you're already in business, a plan can still help you fine tune your business and improve your results.
- Have a clear plan for funding. Whether you're financing your efforts out of pocket or require investment to expand, you need to know where your start-up capital will come from (if you need it), whether you will be servicing a debt, and what resources you can call upon in the future. If you're seeking funding, start with friends, family, and the people in your community. If you must tap into retirement accounts, read Nolo's IRAs, 401(k) & Other Retirement Plans: Taking Your Money Out, by Twila Slesnick and John C. Suttle, to find out how to minimize penalties . . . continue reading at Nolo.com