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Virtual Offices: the perfect fit for home-based businesses

Written By: Aric Chandler Ross

Are you starting your own business and need to save cash? Do you want to test the sometimes turbulent waters of the business world first before you sign a lease for office space or get a mortgage for a building? Does your business lend itself well to operating in a virtual environment? Are your employees willing to work from their homes, cars, or other moving targets? Or, do you simply think the environmental benefits are reason enough to consider a virtual work space? Whatever your reasons, this guide you through some of the issues you have to deal with when setting up a virtual office. We'll also discuss some of the advantages and disadvantages of operating solely in cyberspace. Let's start with where your work will get done.

While the advantages of working from a home/virtual office may seem obvious to you -- more freedom, more flexibility, the opportunity to be at home with your kids -- there are probably even more benefits that you haven't thought of. Here are a few.

    * Environmental benefits from not driving a motor vehicle in slow-moving traffic and polluting the air

    * Reduction in traffic congestion

    * Reduction in stress levels from not having to drive in congested traffic to and from work

    * Time saved not commuting to an office

    * Monetary benefits from savings in gas, wear and tear on your car, business clothing, and lunches out

    * Benefits from being able to manage your time more effectively

    * Productivity benefits from being able to work when you are most productive

    * Health benefits of being able to eat a better diet that includes less fast food

    * Opportunities to get physical exercise when needed mentally

    * Reduced stress benefits

    * Benefit of living a more balanced life

    * A more relaxing work environment

    * More opportunities to hire part-time or contract workers

    * A larger pool of employee applicants because location isn't as important

Disadvantages

    * Lack of face-to-face communication increases chances of miscommunications or misunderstandings

    * Technical difficulties hindering communications or work progress

    * Feelings of separation or disassociation among employees

    * Less camaraderie among workers meaning possibilities for less cohesive work teams

    * Problems separating your free time from your work time because your work is always "there"

    * Less convenient to run errands at lunch time

    * Feelings of isolation if you are always home alone

    * Lack of support - both administrative and managerial

These lists can certainly go on. Your job is to identify the disadvantages that apply to your business and turn them into advantages. Seek outside assistance if you need it. You may need the knowledge of a professional, especially initially, to really make this work. Through good planning, communication, and outside technical support when needed, your virtual office can succeed and help foster future virtual businesses.

From a home office standpoint, there are several legal issues to consider. First, is your home in an area zoned for business? What type of business can you operate from your home? Check out your local zoning ordinances to make sure you don't have to get any special permits or licensing, or have any restrictions on what you can do from your home. For example, if your business requires clients or customers to come to your home then parking may be an issue. Check it out before you get too far into things.

There are also the obvious tax issues of operating a business (or simply working) from your home. If you want to claim a home office, the IRS has stiffened the requirements to the point that you can't use that space for anything other than your work. So, if you're working from your dining room table then you probably can't take that home office deduction. There are some exceptions (like for home childcare, etc.), so contact your tax accountant or attorney to find out the law as it pertains to your situation.

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