Guide

Do you need a Chicago home-based business license?

The city says running a business out of your home requires one. Here is what it costs and what the limits are.

The short version

The City of Chicago says a business operated from your home needs a home-based business license. It costs $250 for 2 years. The initial application is in person at the Small Business Center, your ID must show your home address, and zoning must approve it.

The limits

• The business must stay secondary to living in the home and happen inside it.
• Published space cap: no more than 10% of a single-family home or 15% of any other dwelling, and no more than 300 square feet. Garage space counts.
• No outside signs.
• No more than 2 customers at once and 10 in 24 hours (current city page).
• No direct sales off display shelves or racks.
• One bulk delivery a day, no tractor-trailers. Ordinary parcels are likely treated differently.
• Not licensable as a home occupation: anything the city classes as warehousing, plus food, animal care and other listed uses.

The gray area

The city does not define where reseller inventory ends and warehousing begins, and it is not clear whether every small online seller is expected to hold this license. Call 312-744-6249 and ask, then keep the answer in writing.

Selling used jewelry, electronics or sporting goods

A separate Secondhand Dealer license ($1,100 for 2 years, with daily police reporting) may apply to certain used categories. Ask the city how it applies to online-only resellers.

Opening a storefront instead?

A shop with walk-in customers uses a different license. The Limited Business License is $500 for 2 years (raised from $250 on Jan 1, 2026 according to a secondary source; confirm with the city), and the city adds a card processing fee. The application goes through Chicago Business Direct and includes a zoning review.

Checked Oct 27, 2026 against chicago.gov. Suburban Cook County towns have their own rules.