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In Los Angeles, are we not allowed to work from our garages? Do we have to notify the city if we use the garage as a workspace?

Do you have a water heater or furnace in the garage? Those are not allowed to be in occupied spaces because of the carbon monoxide they may emit. By using your garage for an office you have converted it into occupied space. Also there are requirements for light, ventilation, and egress for occupied spaces that your garage may not meet.