Dear PoPville – Starting a Home Office Problems

Photo by PoPville flickr user philliefan99

“Dear PoPville,

I’ve been running a little side business doing web development and decided things are going well enough to make things official for my little home office: business license, trade name, etc. However, in order to get my business license I first need a Home Occupation Permit. And since I do not own my apartment, I need an approval from my landlord, Borger Management. However, the property manager reports they simply do not allow home offices, which I’m finding a little difficult to believe.

I understand having discretion over activities that would impact other tenants but for professionals who just need a laptop, cell phone, and mailing address? So NO ONE in any of their apartments works from home? Is this kind of simple ban even allowed? Anyone else have experience with this?

Livid in Lanier Heights”

61 Comment

  • Have you ever thought that maybe not everyone wants their neighbor treating the building like an office building?

    Just move and be done with it. Surely the income you will be making will offset the cost to break your lease. If it doesn’t, than why bother?

    • Are you trolling, or just dim? I really should just ignore this comment, but here goes anyway.

      maybe not everyone wants their neighbor treating the building like an office building

      If writing emails & making phone calls is considered “treating the building like an office building” then the neighbors must also dislike when I read PoP and call my mother.

      Surely the income you will be making will offset the cost to break your lease. If it doesn’t, than [sic] why bother

      Maybe the OP is taking a pay cut in exchange for better hours and more fulfilling work?

    • This is a ridiculous viewpoint.

    • What’s driving the concern to get a permit? You are able to work from home without any sort of permit by default. The main concern in having your own business should be paying taxes correctly… Work on establishing a loyal client base and making money until you’re ready to move into a commercially zoned office. You do not need to get permits involved unless you’re planning on running a major operation with 3 employees+, a secretary, and a waiting room.

      • I know from personal experience that this is not true. In DC in order to have a legally registered business you need to have the business license. And in order to get the business license you need a C of O for your home office. Among a number of other things. DC does NOT make it easy to register a home-based sole proprietorship.

        But that’s what you need to do if you want to be a tax-paying business. It’s ridiculous.

  • Find a friend who owns their home or has a more reasonable landlord, and use their address. They would just need to put your name on some official document associated with that address, like a gas bill. A lease might even work. That’s what we did for a friend for her business. Probably not legal, but stupid and unjust laws are meant to be broken.

    • This sounds like a really bad idea.

      My recommendation, you shuold talk to a lawyer. You may not need to get a business license to do freelance design and consulting. You certainly dont need to in order to put your address on a business card. I think you need to talk to the lawyer to know what kinds of things you can do without a BBL.

      • Biggest hangup is getting my merchant account. The bank wants a business license.

        • Have you heard of Square? You should google it. Problem solved.

          • Um, let’s say I’m very familiar with Square. I will be doing zero swipes.

          • Not following you.

          • Guys: I know there are lots of interesting up and coming payment solutions. However, I need something that is mature, does not require an account with a third party, and integrates with my account management backend without me hacking up a solution. (I don’t touch anything related to payment systems.) This means, for the time being, a traditional merchant account. (Or Website Payments Pro but fuck PayPal.)

          • Not seeing how Square won’t work for you. It is really excellent and low in price. Unless you are doing a huge volume of transactions there is no advantage over having a merchant account, at least none that I am aware of. But you tell me–what’s the problem?

        • I have no business license (DC does not require one for my design business out of my home) and my bank did not need one for me to open a business account. I’m using PNC bank.

          • Oh, I forgot to mention that I started my business when I was renting in an apartment building, so it didn’t matter if my address was an apartment or a house.

  • Oh yes, mister kitty (see posted photo of OP’s office/cat) works on websites very hard and he deserves to be licensed so that he can receive the professional recognition that his coding skills command with a real official DC business license.

    I can has business license?

  • “Is this kind of simple ban even allowed”

    It’s their property. They’ve paid a fortune to lawyers to craft their policies to isolate themselves from exposure to lawsuit and conflicts with zoning regulations.

    Maybe you just want to have a simple quiet web business, but then they would have to allow the guy who wants to run a 24 hr a day mail order knick/knack store from his apartment.

    DC is full of incubator spaces where you pay ~200 a month for office space. Use that.

    • You must have a BBL to run ANY kind of business in DC. I had to get one to rent my basement apartment in my 2 unit row house. Its acutally a very easy process, and can be done in about an hour at the building across from DCRA on 4th st, SW near M st.

      if you offer to pay an extra $25/month in rent and clearly explain what it is you want to do, they should allow it. if not, threaten to break the lease and leave.

      • “You must have a BBL to run ANY kind of business in DC. ”

        Yup, this has been a big point of emphasis lately.

      • oh wow..threaten to break the lease. Man, by the time you pay them what you owe them (the remainder of your lease), then you’ve done them the favor of opening up an apt so they can take advantage of DC’s ridiculous rental market and max out their allowed rent increase and have it rented to someone by the end of the week, all so you can go pay more to rent elsewhere and STILL not have the owner let you run a business out of their business.

        Man…you showed them alright.

      • Forgive my ingnorance but what is a BBL?

        • Basic Business License.

          Look for it on the DCRA website. It’s the first step in coming into compliance with DC Taxation and Registration.

      • actually, you don’t. one can operate a legitimate massage therapy practice out of his/her home with just a home occupancy permit. it depends on the type of business.

  • Can you get a registered agent and use their andress as your business address? Lots of offshore companies do this and the business is no more than a p.o. box.
    Then you can chose to work from home/starbucks/library…and that is entirely your business.
    I think you should spend a few bucks with a straight forward business lawyer that charges a flat fee to creat a corporation with the best tax benefits for you and can act as a registered agent.

    I am not an attorney but was a paralegal in another life.

    • Replied in the wrong spot. I’ll definitely look into this so thanks for the idea.

    • Andy(2)is offering the best advice. Registered agents are required to set up a LLC in the District. This could be a solution for you. If you’re serious about this, then spend the money for a lawyer.

    • DC corporate tax rate is 9.975%, the highest in the US.

      Federal tax on C corporations with gross revenue under $50K is 15%. Over $50K and under $75K the fed tax is 25% + $7,500. Higher taxes on income above $75K. Looking at a total of around 35-40%.

      S Corporations, while income is not taxed, require FICA tax payment to employees, plus any disbursement will be treated as income to the shareholders.

      A lot of money up front to incorporate. Plus, filing tax forms needs accountants.

      • Form an LLC. The profit is pass-through and treated as personal income. You avoid all the headaches that propercharlie outlined while protecting your personal assets.

        • Hmmm… I thought I read there was no pass-through in DC for LLCs, just liability protection, but now what I’m reading indicates otherwise.

        • He still needs to supply your business address which is his problem in the first place. Otherwise, LLC would be okay. But he’d still be taxed as a corporation.

          A lot of up-front money and additional tax for no advantage. He needs to move.

          • Lots of weird advice in this thread. An LLC can be taxed as if it were any of the other business entities, which means you have a lot of flexibility. Get a lawyer for cryin’ out loud.

          • Single member LLC is pass-through in DC, trust me i have one. I don’t know where you read it wasn’t. Like others have said, get a lawyer, some random advice is being given here.

          • There’s some really bad tax advice going on here. DC is pretty much the ONLY place that I know of where a single-member LLC income IS NOT treated as pass-though for state/local tax purposes- gotta pay the same double-tax as you would if you were a corporation.

            It is pass-though income for federal taxes, but not DC taxes, and is one of the reasons DC is so small biz unfriendly.

  • This isn’t something I had considered. Thanks.

  • – will this business bring in more mail? esp boxes? that would affect your landlord’s ability to provide an adequate mailbox.
    – is this address going on a business card/ being broadcast? what happens if people come to the address? what if they can’t find you, will they go annoy mgmt? what if, say, the IRS comes to look for you? will they go annoy mgmt if you are not there or unresponsive?
    – does this set a precedent? “OP started a business in one of Borger’s buildings, I can too”.
    – what happens if your business grows? will you hire employees? are they going to come over to work out of your apt? what happens when you are on vacation and one of your employees *needs* something out of your apt? will they go to mgmt and try to convince them to open your apt, even though they are not a tenant?

    Maybe Borger just doesn’t want to deal with any of it. It is their building after all.

    can you use a PO box as the address? This is also much safer, I’d imagine.

    • Not sure about using PO box. From working through the documents, I would doubt it but have yet to see anything specifically ruling it out yet.

  • This seems like the biggest non issue. If it creates an issue, don’t do it or don’t tell your landlord. Why would anyone know or care? Generally people aren’t paying attention to what you’re doing. In DC people aren’t paying attention when you bash a car window in and steal it. No one is going to care.

    • Because I need a business license to establish my trade name and merchant account. Thanks for reading.

      • Ha.

        I’m guessing the apartment management also needs to sign off on that, right? So sneakily doing it is not an option.

      • No, you don’t need a BBL for a bank account. Your bank just needs the FEIN, articles of organization for your LLC, and the sheet they give you for the registration at DCRA. It only takes baout 15 minutes at DCRA.

  • I was wrong. Working at home is the best.

  • As an aside, if you’re looking for a front-end graphic designer, hit me up. 🙂

  • Maybe it’s because you’re a cat?

  • It’s their property, their discretion. Plus, there is a big difference between “working from home” and operating a business out of your home, which is what you would need a HOP for.

    See if you can find office space you can rent. Or move.

  • andy

    I’ve heard that Mid-City Caffe is the best spot to open up a home-based business. Just buy a $2.50 coffee and sit there all day.

    No wait, that won’t work.

    Maybe just incorporate in Delaware and treat your home as the satellite office.

  • I am a self-employed consultant (sole-proprietor) and am not required by DC to have a BBL, though I did register a trade name that let me open a business banking account. I ran my business out of my home office in my apartment for several years before buying a house.

    If you don’t employ anyone but yourself or spouse and can accept the tax/liability implications a sole-proprietorship would work, and requires no paperwork (unless a trade name is desired).

  • To Bill and OP, why do you need to register a trade name? Where is this registered? Thanks.

    • You need a trade name as a sole-proprietor if you want to do business as something other than your legal name. To cash checks made out to MyBizName instead of John Smith or whatever.. a bank will ask you for a business license or trade name registration to open the account in that name.

  • You may want to become a member of a shared work space center like The Hive (and I believe there is one on H St/Atlas District) and use that address as your official office address but work from home. It would sort of be like telecommuting if you set it up that way and I don’t think the IRS or your management company can get upset with that. Good luck.

  • While I can’t offer a suggestion to help (sorry), my guess is that the law requiring a home occupation permit was enacted before there were forms of communication (i.e. telephones, fax machines, the internet) that did not require face-to-face transactions. Perhaps it’s time to modernize those laws to adapt to how businesses work are run now (a home massage therapy practice, for instance, is very different from the type of business the OP describes). That said, this sounds like another reason why renting sucks sometimes – if you can’t find a reasonable way to work around this requirement, it may be in your best interest to seek out a landlord who will approve such a request.

  • Its funny how government can distinguish betweeen various human profiles and enact various laws to protect various groups but can’t distinguish types of business. Surely government can tell the difference between an intellectual product and a dry cleaner? Really something.

  • interesting. i work from home full time for a software company.. but, as this distinction has been pointed out, it is not my business, so there isn’t any need for permits, licenses, bank accounts, etc (i hope!). but i just moved into a larger apartment to accommodate the new arrangement, and the management company (aubinoe) didn’t bat an eye lash when i told them i’d be working FT from the apartment..

  • You can also try the GW Small Business clinic for advice – they offer free legal assistance for things just like this. Here’s a link to the application for legal assistance:

  • You can also try the GW Small Business clinic for advice – they offer free legal assistance for questions just like this. Google search: GW Small Business and Community Economic Development Clinic – there’s an application for legal assistance somewhere on the page.

  • I run a consulting firm out of my apartment, all I had to do was go to a UPS store and sign up for mailbox service. You get a physical address not a PO box, they charge a monthly fee, but it’s worth it.

    • That would be great but how do you get around the requirement to list a certificate of occupancy or home occupancy permit for the address?

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