Business Licenses Q&A: Physical Locations vs. Home Offices

Audience Question: Can you discuss business licenses based on location? For example, how about employees working in a physical location vs. working from home?

Joe’s Response: Here’s my general rule of thumb. If there’s a physical location where employees commute to work every day, only that location needs to be licensed. However, if employees work from home, then the situation may give rise to additional licensing requirements, such as home occupation permits or separate business licenses for the home.

Amanda’s Response: Licensing at the local level varies greatly. Some local licenses are based on revenue generation. Therefore, having an employee work from home — and not generating revenue from local customers — wouldn’t necessarily trigger a business license in that locality. In other cases, a municipality may require a business license for a business office or a home occupation permit for an employee working from home. With regard to home occupation permits, many local jurisdictions are concerned with business equipment located on a residential property outside of the residence itself (and increased traffic due to deliveries or customers), so if someone simply has a home office that doesn’t touch on these concerns, many authorities aren’t going to be overly worried about the lack of a home occupation permit for that employee but they still may want the company to have a business license for that jurisdiction regardless.

(Author's Note: Business Licenses, LLC was pleased to host a webinar on April 30th, 2014 to discuss emerging trends in business license compliance. During the Q&A, the audience submitted many thought-provoking questions that our panelists didn’t have time to answer. We are going to periodically post those questions to this group along with answers from the two panelists, Amanda Mattaliano and Joe Vitulli.)

By Alan Ruttenberg