Business Law│Starting a business is an exciting opportunity for many people, but it can be easy to forget about the legal implications that go along with creating a new company. Business law concepts can be confusing for anyone who does not have a background in legal issues. Here are some steps for potential business owners to take before they get their business up and running.
- Choose a fictitious name and run a search to ensure that the name does not conflict with the name of another business. Once a name that does not infringe on another business’s rights has been chosen, a Doing Business As (DBA) notice must be advertised in a local publication.
- Determine the appropriate business structure for the company. Many business owners opt for the limited-liability company structure to give themselves protection in case the business suffers losses. Depending on the financial scale of the business, incorporating may be preferable. People who are completing work alone and do not have a formal company may prefer to opt for a sole proprietorship, while business owners who are starting a business with just one or two other people may look into starting a partnership. Business law professionals can help clients make this determination.
- Obtain a Federal Tax ID Number to ensure that the IRS is able to track tax liabilities. This step is essential for ensuring compliance with tax regulations.
- Research requirements related to business permits in the state and municipality associated with the business’s physical address.
- Keep the business finances separate from personal finances to avoid confusion about the classification of income and expenses. Ideally, business owners should not start spending or receiving money on behalf of their business until they have taken this step.
- Securely store all contracts and legal paperwork related to the business. Paper copies of these documents should be stored in a fireproof safe, and digital copies can be kept in secure cloud storage.
Experienced Business Law Attorneys Helping You Understand Your Business
While the general guide above helps future business owners to get started, it is important to consult with a business law attorney to avoid making costly legal mistakes when starting a new business. The business law attorneys of Young Wooldridge, LLP are experienced in the areas of business formation and planning, tax, and estate planning. Contact Young Wooldridge, LLP for a free initial consultation.