Florida home-based business

Is Setting Up A Florida Home-Based Business Legal?

Many people run a Florida home-based business. It’s a great way to stay at home while still earning a good income. But, is operating a business from home even legal in the Sunshine State?


Florida Home-Based Business: A Rising Trend

The COVID-19 pandemic forced millions of Americans to stay indoors for an indefinite period of time. Face-to-face gatherings, including in-office work, took a back seat for a long while. Companies resorted to a work-from-home setup, with employees completing tasks and attending meetings remotely. As restrictions began to ease, many companies and workers saw value in continuing the work-from-home setup.

Even before the pandemic, though, residents saw an opportunity to make a living from the comfort of their own homes. From startup companies to professional consultants who worked from their living room, a home-based business simply made sense. Today, it isn’t totally unheard of for a property owner to operate a business or do remote work from home. The problem is that not all places allow it.


Is Starting a Home-Based Business in Florida Legal?

Florida HB403Florida House Bill 403 prohibits local governments from taking certain actions concerning the licensure and regulation of home-based businesses. It also allows home-based businesses to operate in areas zoned for residential use, among other things.

First filed in January of 2021, the bill quickly made its way through the House and the Senate. On June 29, 2021, Gov. Ron DeSantis signed the bill. And, in July 2021, the bill passed into law.

Florida HB 403 is interesting in that it essentially makes it harder for local governments to prohibit home-based businesses. If owners secure the proper permits and licenses, they can run a business from home.

As per Rep. Mike Giallombardo, the bill acts as a way “to keep Florida at the forefront of freedom.”


Legal, But Concerning

A common concern local cities have raised about Florida HB403 is that it does not regulate the kinds of businesses opening from homes. In Tallahassee, a major worry was the establishment of strip clubs or brothels, right in the middle of single-family communities.

A few months after the bill passed, the city of Lauderdale Lakes encountered another concern: ammunition shops. Popping Smoke Ammunition filed its paperwork to start operating from a two-bedroom home. This immediately caught the attention of local officials, with Mayor Hazelle Rogers turning to Tallahassee lawmakers for assistance.

Under the new law, the officials from Lauderdale Lakes likely had no way of stopping Popping Smoke Ammunition from setting up shop.

Jameson Labady owns Popping Smoke Ammunition, his second venture after JSL Security Intelligence, a private security company. Labady had been wanting to expand his business for quite some time. And, even though he didn’t plan on keeping his ammo in the house, the homeowner eventually stood down after his homeowners association expressed its concerns.

The price of ammo has been climbing, making it the perfect opportunity for Labady to expand. And while he knew he could fight his HOA, he ultimately decided to find a commercial space instead.

With all of these concerns, it is likely that Florida lawmakers will revisit the new law and make any necessary changes, such as specifying which industries are not allowed to operate in residential areas.


Not the First HOA to Ban Businesses

Homeowners associations have long had a reputation for imposing stringent rules, including ones that restrict home-based businesses. The idea behind this is that HOAs have to maintain a certain aesthetic and character. If residents start using their homes for commercial purposes, it would affect the quality of life in the neighborhood.

For example, a distribution company typically needs several vehicles to deliver goods. Even if those vehicles aren’t parked on the street or driveway, the constant coming and going can still be a nuisance to neighbors. Several parked vehicles also mean the streets would be somewhat blocked, thereby making it harder for emergency responders to pass through.

This is a particularly touchy subject for gated communities. Gated communities hinge on privacy — in fact, it’s one of their selling points. But, once a gated community allows home-based businesses, it will likely see a spike in visitors (i.e. customers). Letting strangers freely enter the community not only shatters the exclusivity of the HOA but also endangers those living in it.


Does the New Law Apply to HOAs?

Notably, Florida House Bill 403 does not supersede any current or future declaration of a condo or homeowners association pursuant to Chapter 718Chapter 719, or Chapter 720. In other words, if an HOA’s declaration restricts a Florida home-based business, it remains enforceable. However, the bill does not speak on rules and regulations.

Some associations don’t expressly state in their declaration that home-based businesses are not allowed. In that case, a homeowner may argue that they can run a business from home, provided they have the correct licenses and permits.

Most negative reactions to the new law, though, are coming from local governments and neighborhoods without an HOA. Because they are not protected by restrictions similar to condos and HOAs, they have less power to regulate home-based businesses.


Can Tenants Start a Florida Home-Based Business?

Florida HB 403Tenant management is a huge pain point for many landlords, especially if their tenants start running a business from home. The new law, though, does not say anything about landlords prohibiting tenants from operating a home-based business. Therefore, landlords still have some authority over this matter.

If a landlord wishes to ban home-based businesses, it is necessary to include such a term in the lease. It should state that the tenant can’t use the home other than for residential purposes. Even if the other provisions in the contract indirectly prohibit home businesses, it is still best to put it in specific terms. Should the tenant violate this term, it would be a cause for termination.

For tenants who want to run a home business, it is imperative to ask permission from the landlord first. This way, they can prevent any inadvertent lease violations.


Changes Likely to Come

Considering the new law on Florida home-based business, many expect the conversion of more residential homes in the coming years. But, as concerns about safety mount, the law may see some changes soon.

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