How to Help Your Kid Start a (Legal) Business

Source | : By Jennifer

Kids just want to be kids. But kids also want to be grown-ups. That’s why letting kids have neighborhood lemonade stands, yard sales or lawn mowing businesses is a great way for them to learn responsibility and the value of a dollar.

However, child-run businesses can sometimes run into problems if they’re not legal. Believe it or not, neighbors will complain to have a business shut down if there aren’t proper permits and paperwork.

“Cities, countries and states have laws that require businesses to secure permits and licenses to operate,” said Mark Williams, customer service operations director at BizFilings. “Those rules can extend to just about every business, including those owned by a child.”

An increasing number of states and communities have started to make it easier for young entrepreneurs to make money, but in many communities, children and teens need to secure the right paperwork to lawfully run their businesses, according to Williams. Depending on the age of the child, a parent will need to help.

“For the typical lemonade stand, lawn mowing business or snow shoveling operation, young entrepreneurs will need to check with local officials to determine the compliance requirements,” Williams said.

The first step is to search for more information on the website of the city and county where the business will be located, or just head down to your city hall to find the officials in charge. Williams said that they can often be found in a community’s finance or revenue departments. To secure a permit or license, business owners will need to fill out forms and pay a fee, which can start around $50.

City and county officials in the jurisdiction where the business is located can outline the requirements, explain penalties for noncompliance and provide the proper paperwork to get the process rolling.

You might be asking yourself, “Why go through all of this if it’s just a lemonade stand? What harm could be done?” Williams warns that neighbors or passers-by often have the time and proximity to tattle.

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