Create a Business Plan

• Writing out business goals and action steps helps you clarify and organize your priorities.

Choose a business structure

• When starting a business, you will need to select a business structure for your business. This decision impacts how much you pay in taxes and your personal liability (i.e. who is legally responsible for debts). You will need to decide before registering your business.

Choose and file a business name

• If you choose to conduct business under a name different than your own (ie. John Doe), you must file a Fictitious Business Name (FBN) with the SF Office of the County Clerk.

Apply for an Employer Identification Number (EIN)

• An Employer Identification Number (EIN) is also known as a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number. It is a unique nine digit number assigned by the Internal Revenue Service (IRS).
• Generally, businesses need an EIN to pay employees and to file business tax returns.

Register your business in San Francisco

• You can get a separate business address or you can use your personal address for your registration.

• Check if the service you offer requires a professional certification or license. Career One Stop is a free online resource to check if a license is required for your occupation.  
• See if your business will need permits. Check with the state and ask the San Francisco Office of Small Business.

• You cannot have clients coming to your home.
  • Some services are exempt and you can have clients at your home. These are services that are traditionally practiced at home. Those may include acupuncture, massage therapy, psychiatry, and salons.
    • The CA Board of Barbering and Cosmetology provides guidance for Home Salons.
• You cannot have employees who do not live there coming to the home. 
• You cannot display advertising at your home
• You cannot make any physical changes to your home that are non-residential in character. 
• You cannot use more than 1/3 of the total floor area of the unit for commercial purposes. 

Read the Accessory Uses for Dwelling Guide for more detailed rules for home office or another home-based business.  

If you are renting your home or must comply with a Homeowners Association charter, check if this commercial activity is allowable.  

The California Homemade Food Act (known as the Cottage Food Law) allows some businesses to make certain foods from home.

Check the California Department of Public Health Cottage Food Operations webpage and the San Francisco Department of Public Health Cottage Food Permit webpage for additional information.  

• Customers are allowed to pick up orders from your home under this program.
• You must attend a food processing class. 

What businesses can apply to manufacture food from a home

• Businesses producing “non-potentially hazardous” foods. These are foods that do not require refrigeration to keep them safe from bacteria that could make people sick.
• Those selling directly to customers and earning under $75,000 annually (Class A)
• Those selling directly and/or indirectly to customers and earning under $150,000 annually (Class B). For example, you sell to a market, bakery, or restaurant.
• Businesses with no more than one full-time employee. This doesn't include family or household members. 

Home-based food inspections

• Class A: Department of Public Health will inspect your home if a customer complains.
• Class B: Department of Public Health will inspect your home kitchen annually.

Other key requirements 

The label must include the words "Made in a home kitchen" or "Repackaging in a home kitchen" (information on cottage food labeling is available at the California Department of Public Health Cottage Food Operations website)  

No infants, small children, pets, or smoking are allowed in the kitchen during cottage food preparation. 

Pay your taxes

• Depending on your business's structure, you may be required to pay the federal self-employment tax, among other taxes. Review the federal tax forms for independent contractors.
• You may need to pay quarterly federal tax payments, especially if you get 1099-K forms from a 3rd party platform.
• San Francisco Office of Financial Empowerment offers free, confidential one-on-one financial coaching to help you achieve your goals, as well as help you find a safe, affordable bank account.

Get health insurance

• As a resident of California, you may qualify for financial help through Covered California. If you’re a resident of San Francisco you can consider Healthy San Francisco, which is available regardless of immigration status, employment status, or preexisting medical conditions.

Get legal help, if you need it.