Starting a business is one of the most rewarding things you can do. And thanks to the internet, all you need is a laptop to start generating your own income.

But when you register your business and begin to operate it, you’ll need to do a few things, including filing with the IRS and getting a business license. You’ll also need to decide on a business address.

When it comes to choosing a business address, there are two main options: a home business address or a virtual business address.

What Is a Virtual Business Address?

When you register your business, you’ll have to establish a location in the state or country where you’re operating. This can be your home address, but if you’d rather keep your personal and business life separate, or if you work from home and don’t want customers coming to your house, then you can opt for a virtual business address instead.

A virtual business address is simply an online service that gives your business a physical mailing address. This can be used for everything from filing your business license to registering with the IRS, and it’s a great way to keep your personal and business life separate.

This can be beneficial for businesses that want to establish a presence in a particular city or state but do not have the resources actually to lease or purchase office space there.

Virtual business addresses can also be useful for businesses that operate primarily online, but still need to provide a physical mailing address for correspondence and shipping purposes.

In most cases, businesses that use virtual business addresses will have their mail forwarded to their actual location, or will use a P.O. Box associated with the virtual address.

The Basics of Home Business Addresses vs. Virtual Business Addresses

So, what’s the difference between a home business address and a virtual business address? Let’s break it down:

Home Business Address

A home business address is simply your personal residence address that you use for your business. If you have a business license or are registered with the IRS, they will have this address on file.

The main advantage of using a home business address is that it’s free–you don’t have to pay for a separate mailing address. When you use a virtual business address, you’ll have to pay a monthly fee for the service. You’ll also need to hire an agent to receive and forward your mail, which can be an additional expense.

Another advantage of using a home business address is that it’s easy to set up. You don’t need to do anything special to get started. Just use your regular home address and you’re good to go.

Owning your own place also gives you more control over how people perceive your business. You could use a physical address for partners or clients to visit your office or as a mailing address for business-related mail.

If you don’t want people coming to your home, you can always get a P.O. box or use a UPS store as your business mailing address. But a physical address also looks more professional than a virtual one and can help you appear more credible to customers

While there are several advantages to using a home business address, there are also a few disadvantages to consider.

One of the primary disadvantages is that if your business begins to grow and you need to move to a commercial space, you will need to update your address with all of your customers and clients. This can be a time-consuming and costly process.

You also may want to avoid listing your home address publicly on your website or marketing materials. This can be a security concern, especially if you have young children at home.

And if your name is attached to your business (which it will be unless you file in a state with financial anonymity laws), using a home address can make it difficult to keep your personal and professional life separate. In rare cases, it could even result in stalkers or other unsavory characters appearing at your door or monitoring your personal life.

Virtual Business Address

A virtual business address is a physical mailing address that you can use for your business but is not associated with your personal residence. It is commonly used for those who file businesses in states other than their home state, or for businesses that are operated primarily online.

While a virtual business address does not provide you with a physical space to use as your office, it does offer some distinct advantages.

First, using a virtual business address can help you to establish a presence in multiple states or cities without actually having to lease or purchase office space there. This can be a great way to expand your business without incurring the significant expense of opening new locations.

Using a virtual business address can help you to keep your personal and professional lives separate. If you use your home address for your business, it can be difficult to prevent clients or customers from contacting you outside of work hours or–in the worst cases–showing up unannounced at your home.

However, having a virtual business address isn’t all sunshine and rainbows. One of the primary disadvantages is that you will need to pay for a monthly service to maintain it. This can be anywhere from $50 to $100 per month, depending on the features you need and the provider you use.

In addition, you’ll likely need to hire an agent–such as a professional mail forwarding service–to receive and forward your mail. This will add an additional monthly cost to your overhead.

Another potential downside of using a virtual business address is that it can make your business seem less credible or professional than one with a physical address. In some cases, this can be overcome by choosing a well-known and reputable provider for your virtual address. But in other cases, it may be necessary to use a physical address in addition to or instead of a virtual one. This is often the case for businesses that require face-to-face interactions with clients or customers, such as an agency or brick-and-mortar retailer.

So Should I Choose a Home Business Address or a Virtual One?

There is no one-size-fits-all answer to this question. The best solution for your business will depend on a number of factors, including your budget, the type of business you operate, and whether you will ever need or want a physical space for your business.

If you’re just starting out and are on a tight budget, using your home address for your business is probably the best solution.

Once your business grows and you have the resources to do so, you can always upgrade to a virtual or physical business address.

In our experience, operating a business with a virtual address is relatively easy, and keeping your home address a secret is well worth the additional cost for any business owner.

What to Do Next

When you’re ready to start your business, the first step is to choose a business structure. This will determine what kind of legal and tax requirements you’ll need to meet.

Once you’ve chosen a business structure, you can register your business with the state. This will give you a formal document that proves your business exists and allows you to open a bank account and get a business credit card.

After you’ve registered your business, you’ll need to get a business address. You can use your home address, but we recommend getting a virtual business address. This will give your business a professional appearance and help you stay organized.

Ready to get started? Check out our blog on how to start a business in 24 simple steps!