How to Start a Small Home Farming Business

Herbs can be successfully grown and marketed from an apartment.
Herbs can be successfully grown and marketed from an apartment. (Image: herbs & spices image by from

If you have green thumb or love animals, a home farming business can be set up with little start-up capital. A home-based farm business can range as small as growing specialty herbs in an apartment to raising livestock on a few acres. Like any business, it takes dedication to succeed.What type of home farming business to start is something that is personal to each individual.

Take stock of what you can do. Space can limit the type of agricultural business you can successfully operate from home. If you have land available, you may be restricted by zoning ordinances or terrain. Select the best type of small home farming business you can do and one that matches your interests. You may decide that you would rather work with animals as opposed to growing herbs, vegetables or flowers. If you have room for a large orchard or tree farm, you may find the attraction of long-living crops better suited than the daily necessity of feeding and watering livestock.

Investigate any tax and licenses that may be required for your small home based farming business. If you are selling home grown herbs to restaurants, health and safety inspections may be required. Many homeowner's policies will not cover a home-based business. You may need to purchase a special insurance policy to protect yourself from liability. .

Small home based farming business will usually not be required to have employees. However, if your business is labor intensive you may want to consider setting up your Federal Employer Tax Information in the event you need to hire seasonal farm workers.

Invest in a good bookkeeping system. In the beginning you may only have a few receipts for hand tools and seeds, but those records will pile up if you do not tend to them on a regular basis. Whether you choose to do a manual system or a computer based automated system, keep your business records up-to-date. You never know when you will come across an opportunity to apply for a grant or want to use your business income for expansion.

Keep abreast of trends and market prices for your crops. One of the best incentives to keep going is to know what is selling and for what price. This gives you a good understanding of the value of your crops and provides you with the knowledge of when to sell and what to grow for the next season.

Report any income you receive to the Internal Revenue Service using Schedule F. Small home-based farms can use Schedule F to report income from a wide range of sources. The agricultural industry also has numerous expenses that are unavailable to most business. Examples of these expenses are the price of seeds and any seasonal or contractual labor they may need to harvest crops.

Tips & Warnings

  • Small business need to keep a close eye on their bottom line to take advantage of investment potential and cost cutting measures as needed.
  • Never start any type of business without researching your potential customers and markets.

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