How to Renovate Your Home for Your Home-Based Side Hustle
Do you want to start a home-based business? If so, you’re not alone. With the layoffs and downsizings in today’s economy, this may be your time.
A dedicated space to conduct your business has many advantages. The following are tips and suggestions on how to remodel your home so you and your business can succeed.
Decide What Type of Renovation You Need
Here are some questions you should ask yourself to determine how you will modify your home to create your new office:
- What is your business?
- Is it going to be a one-person operation, or will you have employees?
- Will you have customers? Will they have to visit your office?
- Can you do your job with just a laptop and a cellphone, or do you need space for lots of equipment?
Your answers will help you decide if you can use a spot in your kitchen or need a space large enough to have its own entrance and waiting area.
Choose a Contractor
Because of all the intricacies involved in a renovation, you need to hire professionals. You can choose your own architect and then hire a general contractor, or you can go with a design-build contractor that covers it all.
How do you determine who to hire? Ask friends for recommendations. Check out the many home improvement contractor rating websites.
Ask the pros you’re seriously considering to provide you with recommendations. Then visit these people to not only check out the work, but to ask them what their experience was like — not just with those in charge, but with the workers on their team. Are they professional and courteous? Do they try to keep mess to a reasonable minimum and clean up after themselves when the job is finished?
Price is always a major consideration, but don’t go with the cheapest price and end up paying more later for fixes and repairs.
Also, if any contractor says you don’t need permits because the project is small, run! Always get the necessary permits. It will save you from wasting valuable time and money.
Modify an Existing Space
You decide to finally use your unfinished basement or attic, or you elect to combine two small rooms on the first floor of your home. Maybe you choose to rework an already existing expansion.
Just because you’re not adding onto your home doesn’t mean there isn’t a lot that needs to be done.
Here’s a partial list of projects:
- The building or demolition of walls
- The rental of needed construction equipment and a dumpster or bagster to haul away debris
- The installation of new flooring
- The addition of sufficient connectivity. This can include adding well-situated wall outlets, internet and cable jacks, wiring for extra electricity and installing a wireless network
- The purchase of new equipment, including a computer, printer and phones if what you have currently won’t be able to handle your new workload
- The purchase of new office furniture
Your contractor and designer will walk you through the process and help you coordinate all of the necessary plans.
Build Something Completely New
You have decided to build an office addition. In addition to everything listed above, you have to determine where you want to add the office space. You can go up, like over a garage, or you can go out, like an office extending from the back of your house.
This is where design is key. In addition to your office layout, you’ll need to choose an exterior that works well with your home. After all, your office’s new roof is part of the change to your home’s look.
You get to choose the materials for the exterior and interior that either match or complement your home. From siding and stonework to windows and tile, it’s like designing a mini-home.
Don’t forget the HVAC, either. This is an area that is often shirked on with extensions. You’ll be spending a lot of time in your office, so you want to feel comfortable in it all year long.
Don’t Forget to Take the Proper Deductions at Tax Time
There are many benefits to having a home=based business, including a short commute time. Other great advantages you don’t want to miss are the tax breaks your home office may provide. This can make available extra cash you can use for your business.
The easiest way to utilize your home office tax break is to use the Simplified Home Office Deduction. Instead of calculating all your possible deductions and depreciations, you multiply the square footage of your office by $5 per square foot. The maximum allowed is 300 square feet for a maximum deduction of $1,500.
You may be the kind of person who likes to sweat the details. If you have an accountant or tax advisor preparing your taxes for you — which is highly recommended — then the following list contains deductions and depreciation calculations you may want to consider. Be forewarned: Taking these deductions could lead to an audit from the IRS.
What Can Be Deducted
- All expenses related solely to your home office are deductible
- Expenses that cover the entire house, like heat, electricity and home insurance, are only proportionally deductible
- Rent, mortgage payments and taxes can be proportionally deducted
- Home depreciation can only be deducted proportionally
What Can’t Be Deducted
- All expenses related solely to your home
- Lawn care service
So, your cable bill can’t be used as a home office deduction.
Working for yourself can be very fulfilling. Create a home office that is your customized base for success.
Images via pexels and flikr.