Using a Home Business Address vs. Virtual Business Address

A virtual business address can solve some of the problems, such as privacy concerns, that can arise when running your business from your home.

by Belle Wong
updated June 22, 2022 ·  5min read

For many small businesses, working from home offers a number of advantages, from the significant cost savings of not having a business lease to the potential for increased efficiency and productivity. But just because you run your business from your home doesn't necessarily mean you need to use your home address as your business address.

Virtual business address providers offer address-only services—including a real street address that can receive postal mail and packages at a secure location, while protecting your privacy—or more extensive services, including meeting space and administrative support.

woman writing at her desk in home office

Who Needs a Virtual Office Address?

In many ways, a virtual business address can give small business owners the best of both worlds. With a virtual business address, you can present a polished, professional appearance to your customers while at the same time most of the work of running your company can still be done from the comfort and convenience of your own home.

Any business can make use of a virtual business address. Whether you're a sole proprietor or you run your company as an LLC or a corporation, you have the option of using a virtual office address as your business' legal address. You could receive not only regular business correspondence at your virtual address but also any legal correspondence from the government.

What Are the Benefits of a Virtual Office Address?

Virtual business addresses offer a number of benefits over a home address for your business.

Professional Appearance

Virtual business addresses are typically located in business areas rather than residential neighborhoods. In many cases, having a virtual office address on your company's letterhead and other business communications presents a more professional appearance than a residential address.

Depending on your industry, a professional presence can be a key tool for building credibility in the eyes of potential customers and maintaining trust with your existing customers. Every place a client or potential client sees your business address is an opportunity for you to build that trust and credibility. Depending on where you live, you may find that using a virtual business address will be the better option.

Privacy

Even if you run an online-only business, you'll come across multiple occasions where your address is visible to the public. For example, if you have an email newsletter that goes out to your customers, the CAN-SPAM Act requires you to put your physical postal address in each newsletter you send out. But beyond this, customers tend to trust businesses with a physical address more than one that gives no indication of where it's located.

This means that if you use your home address as your business address, this information is out there for the world to see. And even if you try to limit where you put your address, certain legal reporting and filings, such as the contact information of the registered agent for your LLC, become a matter of public record. For many people, this visibility can raise some important privacy considerations. If this is an issue for you, a virtual business address will go a long way toward eliminating such privacy concerns.

Meeting Spaces

In addition to providing you with a business address you can use for all of your business correspondence, many virtual business address services also offer their customers the use of professional meeting spaces, including the presence of an on-site receptionist to greet your clients. The ability to book a meeting space may be included with your virtual office address, or it may be an add-on feature that you can make use of for a reasonable cost.

If you occasionally need to meet with customers or clients and would prefer not to hold your meetings in your home, a virtual business address that offers meeting rooms is a more cost-effective option than booking meeting space elsewhere. And it provides a more professional option than arranging to meet your clients at the local coffee shop.

Legal Restrictions

Depending on where you live, you may run into a number of restrictions on running your business from your home. For example, zoning restrictions may prevent you from legally operating a home business. Or if you're renting, your lease may have a clause prohibiting you from running a business from your rented premises.

With a virtual business address, your home address would not be the legal address of your business.

What Are the Disadvantages of a Virtual Office Address?

While a virtual business address has many advantages, it also has a number of disadvantages over using your home address as your legal business location.

Cost

Even if the virtual office address service you're considering is relatively inexpensive, you'll need to pay for it on a regular basis. In comparison, it doesn't cost you anything extra to run your business out of your home, and for many small business owners, particularly those just starting out, this is a clear advantage of using a home address as their business address.

If a virtual office address includes features such as meeting spaces, the cost of providing these extras is typically built into your monthly fee. You will need to consider how often you will use these additional features to see whether the additional cost is reasonable for your particular needs. For example, if you rarely hold meetings, you may be better off using a virtual business address service that offers an address-only fee, with extras charged on an as-used basis rather than as part of your monthly fee.

Convenience

A virtual office address isn't as convenient as using your home as your business address, although, depending on your situation, the inconvenience may be relatively minor. For example, with a virtual business address, you will have to retrieve your business correspondence rather than have it delivered straight to your home.

If you plan on utilizing features such as meeting rooms, you'll have to plan for the additional time it will take for you to get to your meetings and back. You may also incur other potential costs, such as parking or public transit fees, that would not arise if you held business meetings in your home.

For many small businesses, a virtual address makes good sense. But it also comes with disadvantages. Whether a virtual office address is the right choice for your business depends on your specific circumstances.

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Belle Wong

About the Author

Belle Wong

Belle Wong, J.D., is a freelance writer specializing in small business, personal finance, and marketing topics. Connect … Read more

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of the author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.