Phyllis Rosales made sure that her Wee Care Preschool Day Care home business complies well with all the zoning ordinances and other legal requirements, i.e., city business license, city fire and health codes, etc.

It's estimated that tens of thousands of home-based businesses operate in the Kansas City area. No one knows for sure, because many of these operations don't comply with the most basic issue - licensing.

"Some 75 percent of all the people that come to us (at the small-business center) are working at home or getting ready to move their business out of the home," Kolich said. "And more than half of those folks are not yet filing anything."

Most cities, including Kansas City, require business licenses for all home-based business. That's why prospective owners should call City Hall first, said Barbara Millard who teaches a class on home-based businesses at Johnson County Community College.

In most cases, the licensing process means filling out paperwork and paying a fee (typically $25 to $50 a year). But for some businesses - including those that involve clients coming to the home - the city may require a special-use permit. And that can add complications.

Learn more about the rules and regulations in operating a home business in Kansas via the Kansas City Star.