Can a Felon Start a Business in the U.S.?
A felon can start a business in the United States. No Federal or state law prevents this. However, a felon may be unable to own some specific businesses based on licensing or bonding requirements. For example, a plumber or contractor often requires a surety bond, which is a type of insurance policy. Many states require these bonds. Therefore, a felon should talk to an attorney before starting a business.
Types of Businesses Restricted for Felons
Some types of businesses have restrictions for convicted felons owning or operating them. Any business involving medicine, finance, law, or dangerous materials is likely prohibited. Also, the type of felony may limit business options. For example, a felon convicted of a sexual offense probably cannot operate a daycare or school.
Starting a Business as a Felon
In summary, felons can often successfully start a business. About 4% of small business owners have a criminal record, including 1.5% with a felony conviction. That represents over one million businesses in the U.S. However, felons need to research licensing and restrictions based on their conviction. Forming an LLC typically works well since it limits liability. The key is focusing on an area without licensing barriers. With proper planning, many felons have launched profitable small businesses.
What Business Can a Felon Start?
Felons can start nearly any type of business, including restaurants, retail shops, lawncare, auto repair, construction, and more. Be aware, however, that there may be some restrictions in terms of business licensing based on the crime that was committed, so make sure to look up state and local laws before planning your business.
Top 10 Business Ideas for Felons
- Cleaning Services
- Auto Repair Shop
- Event Planning
- Pet Sitting Business
- BBQ Stand or Kiosk Business
Starting a Business as a Felon
Knowing what enterprises you may or cannot establish is the first step in starting a business with a criminal record. Most enterprises need a license or authorization from federal government or state authorities.
Additional Resources for Felons Starting a Business
Small business grants aren’t the only resources available for felons looking to start a business. These additional resources include everything from educational opportunities to information about housing, government programs, and felon-friendly job opportunities.