Are You Zoned to Work at Home? Don't run afoul of local ordinances that could shut your business's doors.

If you've given thought to setting up a home office, you're not alone. An estimated 39 million people in the U.S. work part-time or full-time from home. But working from home is not as simple as A-B-C. In fact, many home business owners are in violation of the Big "Z"--zoning.

Zoning laws in many communities forbid the operation of a home business. In addition, condominium and co-op apartment homeowners' associations often have restrictions regarding home businesses. But because of how irregularly these rules are enforced, many office owners risk violating the law to operate their businesses.

The main goals of zoning laws are to curtail high-volume or high-traffic activities in a residential neighborhood and to protect property values. Local government officials may not bother a solo "infopreneur" operating in her cramped city apartment with no employees or the virtual assistant working from her attic. She may be able to fly under the radar. After all, who's to say what you're doing tapping away at your keyboard at all hours of day and night as long as you don't disturb the neighbors? However, any more activity than that starts to raise alarms--and tattletales.

Zoning Concerns and Restrictions
Neighborhood complaints are the chief deterrent to illegal home offices. Complaints may stem from entrepreneurs hanging out even a small sign, having commercial vehicles on the property, putting in additional parking spaces or having a lot of client or employee traffic. Having invested substantially in their real estate, residents are naturally concerned about how business traffic will affect the community.

Building owners are particularly concerned about foot traffic, because any injury that occurs to visitors on the premises could embroil the owners in a lawsuit. Should your employee, client or colleague slip on the marble floor on the way to your apartment and crack her head open, the building could be looking at nasty litigation as well as greatly increased insurance premiums. Reducing the foot traffic that comes with business flow is just one way of reducing exposure to risk.

Even where home businesses are allowed, limitations are often imposed, such as:

• Restrictions on employment of nonfamily members. If non-family employees are allowed, you might be limited to one or two.
• Limits on the square footage that can be used for business purposes.
• Prohibitions against changing the outside appearance of the building--such as a garage adjacent to the house.
• Constraints on warehousing inventory.
• Restraints on the size of signage.
• Curbs on the traffic flow the business will generate.
• Limits on the use and parking of commercial vehicles on the premises.
• Prohibition of equipment or processes that create excessive noise or noxious odors.

In addition, the home business owner can be subjected to fines and may be expected to close down operations immediately should a complaint be made to local authorities. Failure to abide by the law after being warned or fined can lead to criminal charges and even imprisonment (rare, but it does happen).

Don't Be an Outlaw
Before beginning your home office remodeling campaign, do your homework. Find out what your local ordinances say. They vary by county, city, and state--visit your local library or MegaLaw for links to zoning-law sites. If the terms are too restrictive, find out whether it would be cost-effective to obtain a special permit or variance. You might also want to know how strictly your local government enforces home office zoning ordinances. Better yet, find an attorney who is familiar with these issues and get him or her to find out for you.