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posted 3 years ago

Lemonade stands and lawn mowing are popular ways for kids to earn pocket change, but could they get in legal trouble for their entrepreneurial activities? 

Kids just want to be kids, but kids also want to be grown-ups.  That’s why letting kids have a neighborhood lemonade stand, 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 are not legally compliant with the local laws. 

Cities, counties and states have laws that require businesses to secure permits and licenses to operate.  Those rules can extent to just about every business, including those owned by a child.  Having a business is a great way for children to focus their energy and efforts on something positive and learning from a young age what entrepreneurial means.  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.

It is important to note that a business is a business, no matter the age of the person in charge.  Businesses must adhere to certain legal requirements, and parents must understand these requirements to make sure their kids’ businesses are legal.  In addition to completing paperwork, such as obtaining a permit, they may have to pay taxes on the money the business earns. 


The first step is to search for more information on the website of the city and county where the business will be located.  It’s important to make sure your kid’s business is up to code because anyone can decide to report the business to the authorities.  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?”  In some cases, neighbors may feel inconvenienced because customers lining up for lemonade could be blocking driveways or adding more noise or traffic to their usually quite residential street.  In addition, competitors have snitched on kid-owned businesses.  A landscaping company, for instance, could report a teen-run lawn mowing business for noncompliance to weed out cheaper competition.  Yes folks, this actually happened!

It’s important to be aware of the legal risks and liabilities if your child’s business is not legally compliant.  Kids who run their businesses without the correct permits or licenses can face closure and other penalties, including but not limited to fines.  Furthermore, a run-in with regulators is almost never a fun experience, especially for a young entrepreneur who is dreaming big. 


Here are some fun business ideas that your kids can start explore:

  • Lemonade Stand
  • Mow Lawns
  • Academic Tutor
  • Artist
  • Baby Sitter
  • Baker
  • Candy Maker
  • Dog Walker
  • Actor
  • Podcaster
  • Author
  • Clothing designer
  • IT Services

You’ll agree that there is so much potential for your kid to make money, and the best time to learn valuable business lessons coupled with hands-on experience is now.  Therefore, encourage your young entrepreneur to start any of these kid businesses that make money with the right permits and licenses.  You will have given your child a head start in life.

You can incorporate your business, find contracts, and download free resources from www.GoLegalYourself.com 

For more information on how to legally start and grow your business please visit my website at www.golegalyourself.com

Disclaimer:  This information is made available by Bagla Law Firm, APC for educational purposes only as well as to give you general information and a general understanding of the law, and not to provide specific legal advice. This information should not be used as a substitute for competent legal advice from a licensed professional attorney in your state


posted 6 days ago


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