Start a home-service business: the first-month checklist
Starting a home-service business in the US takes eight things in roughly this order: a license if your trade needs one, a business structure, a tax ID, a bank account, insurance, a tax plan, a way to quote, invoice and take payment, and your first customers.
Short answer
Check your state and city license rules first. Pick a structure, get a free EIN from the IRS, and open a separate bank account. Get insurance. Plan for self-employment tax. Set up quotes, invoices and card payments in one place. Then find customers who are already asking for your trade.
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Check your license first
The SBA says: “The licenses and permits you need from the state, county, or city will depend on your business activities and business location.” It adds that zoning ordinances “can still apply even to home-based businesses.”
Source: SBA, Apply for licenses and permits, read 5 October 2026
California and Oregon let a handyman work without a contractor license only while the job stays under $1,000, and both void that exemption if you advertise yourself as a contractor. The statutes are quoted in new handyman business with no customers.
Choose a business structure
Two common choices for a one-person business are a sole proprietorship and an LLC. The choice affects liability and taxes, so talk to a tax preparer before you register. Nothing on this page requires an LLC.
Get a free EIN
An EIN is a federal tax ID number for a business.
The IRS says: “You never have to pay a fee for an EIN.” You can get one from the IRS online “in minutes for free.”
Source: IRS, Get an employer identification number, read 5 October 2026
Open a separate business bank account
The IRS says: “For most small businesses, the business checking account is the main source for entries in the business books.”
Run every job’s money through it, and keep your personal spending out.
Source: IRS, What kind of records should I keep, read 5 October 2026
Get insurance
Ask your state license board whether it requires insurance or a bond for your trade, and ask an insurance agent what your work needs, before you quote your first job.
Set up for taxes
- The IRS says you have to file an income tax return if your net earnings from self-employment were $400 or more.
- Self-employed people generally pay estimated tax quarterly; the IRS self-employed tax center explains how.
- If customers pay you by card, your card processor sends you a Form 1099-K, whatever the amount.
- Keep records for at least 3 years, the IRS’s general rule.
Sources: IRS self-employed tax center, IRS Form 1099-K, IRS records, read 5 October 2026
Set up quotes, invoices and payment
Four documents run every job: the estimate, the quote, the invoice and the receipt.
- What each one is: estimate vs quote vs invoice vs receipt.
- Writing the quote: how to write a contractor estimate, and deposit limits by state.
- Billing: how to invoice as a contractor.
- Getting paid: card payments and QR code payments.
- Keeping it together: how to keep track of customers and free CRM for contractors.
Find your first customers
The fastest first jobs come from people already asking for help nearby. Start with how to get contractor leads, how to get jobs from Facebook groups and what to post in Facebook groups.
When things go wrong: an unpaid bill has its own steps in customer won’t pay your invoice, and a quiet phone in handyman business slow, no calls.
The tools from LeadHunter USA
- LeadHunter USA CRM: customers, quotes, invoices and receipts. Free.
- LeadHunter USA Payments: customers pay by card from the invoice, a quote deposit or a QR code. 3.3% + 30¢ per US card, all in.
- LeadHunter USA Alerts: people nearby asking for your trade, sent to your phone. $75 a month after a 7-day trial; needs a Windows or Mac computer.
- LeadHunter USA Line: a business number for calls and texts. Coming soon.
All four come from LeadHunter USA LLC. The CRM does not need the paid Alerts.
Every guide in this series
- LeadHunter USA CRM: the free CRM for contractors, and what other free plans include
- How to invoice as a contractor or handyman
- How to accept card payments as a contractor: fees and rules
- QR code payments for contractors
- Estimate vs quote vs invoice vs receipt
- How to keep track of customers in a small service business
- Customer won’t pay your invoice? The steps
- How to write a contractor estimate
- How much deposit a contractor can take, by state
Set up your quotes and invoices today
LeadHunter USA CRM is free: customers, quotes, invoices and receipts in one place, sent from your own phone.
Create your free accountLeadHunter USA CRM
Send quotes and invoices, and keep every customer and job in one place.
Free
LeadHunter USA Payments
Customers pay you by card from your invoice or a QR code. Money lands in your bank in about 2 days.
Free to join · 3.3% + 30¢ per US card
LeadHunter USA Alerts
People nearby asking for your trade, sent to your phone the moment they post.
7 days free, then $75/month
LeadHunter USA Line
A business number for calls and texts, separate from your cell.
Coming soon
LeadHunter USA Alerts is the paid lead-alert product; the CRM does not need it. Payments needs the CRM.
More guides
- LeadHunter USA CRM: the free CRM for contractors, and what other free plans include
- How to invoice as a contractor or handyman
- How to accept card payments as a contractor: fees and rules
- QR code payments for contractors
- Estimate vs quote vs invoice vs receipt
- How to keep track of customers in a small service business
- Customer won’t pay your invoice? The steps
- How to write a contractor estimate
- How much deposit a contractor can take, by state
Common questions
What do I need to start a handyman business?
Check whether your state requires a license for the jobs you will do, get a free EIN if you need one, open a separate bank account, get insurance, and set up a way to quote, invoice and take payment.
Do I need an EIN as a sole proprietor?
The IRS lists who must have one on its EIN page. Getting one is free: in the IRS’s words, “You never have to pay a fee for an EIN.”
Do I need a license to be a handyman?
It depends on your state and the job size. California and Oregon both let you work without a contractor license only while the job stays under $1,000, and both void that exemption if you advertise yourself as a contractor. In California it also has to need no building permit, not be part of a bigger or split-up project, and you can have no employees. Check your state board.
When do I have to file taxes as a self-employed person?
The IRS says you have to file an income tax return if your net earnings from self-employment were $400 or more. Its self-employed tax center explains quarterly estimated tax.
What apps do I need to start a service business?
One place for customers, quotes and invoices, and a way to take cards. LeadHunter USA CRM is free for the first; LeadHunter USA Payments costs 3.3% + 30¢ per US card, all in.
How do I get my first customers?
Answer people who are already asking for your trade, in local Facebook groups and on Nextdoor, and ask every finished job for a referral and a review.