Home-based Business Legal Issues

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Home-based Business Legal Issues

• Stephen R. Cook, Esq.
• Asst. Clinical Professor of Law
• University of Akron School of Law
• scook_at_uakron.edu
• 330-972-2358

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Why a business?

• Make a profit
• Participate in management of business
• Liability protection from business obligations
• Recognition as a business
• Structure

3
Entity Selection

• Sole Proprietor
• Partnership
• LLC
• Corporation S/C

4
Entity Selection

• Liability
• Ease of formation
• Formalities
• Organization
• Dissolution

5
Entity Selection

• Secretary of State
• Name selection
• Proper form
• Statutory agent
• Filing fee
• Charter number

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Liability

• Insurance Business Owners Policy (BOP)
• Premises/product liability
• Secondary market insurance
• Aggregate, per-occurrence
• Umbrella policy?

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Taxation

• Sole Proprietor Schedule C
• Single member LLC Schedule C
• Multiple-member LLC Partnership taxation
• Flow-through taxation
• S Corp. v. LLC distributive share
• EIN number

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Vendors License

• Vendors or Service vendors license?
• Ohio Department of Taxation
• http//tax.ohio.gov/divisions/sales_and_use/index.
  stm (TOC for Sales and Use tax)
• Check your local taxing jurisdiction
• Better safe than sorry

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Zoning

• Check local zoning office for home occupation
  variance
• Understand specifics of code
• Variance usually based on of business sq.
  footage, limited signage, no effluent and limited
  stress on public infrastructure
• Lawful purpose
• No right to home-based business variance