Starting your own business is a giant step, full of anticipation and uncertainty. Most people look forward to being their own boss. Coupled with the dream of independence is the fear of being responsible for all aspects of the business. Your attorney is qualified to remove some of the uncertainties of getting your business going.
• You have the choice of operating your business as a sole proprietorship, or if others are involved, as a partnership. Unfortunately, this arrangement would probably make you liable for all debts of your business.
• Forming a corporation or a limited liability company can assist in avoiding any business liabilities for which you did not otherwise guaranty or accept personally.
• A corporation or an LLC is able to deduct from its income all expenses of operating your business. Your corporation or LLC may also pay your medical insurance, provide you with a car, pay for your trips on company business, and pay your medical expenses.
• A business owner may become personally liable for obligations such as: covering employees with workers compensation insurance, collecting and remitting sales and payroll taxes.
• To take full advantage of the protections afforded by operating your business under a corporation or LLC, you must make sure all legal formalities are observed in drafting your articles of organization, preparing the operating agreement or by-laws, making tax elections and keeping minutes.
• Most businesses thrive when they are properly capitalized and well managed. A business is likely to fail if it is underfunded or its owner does not focus on good management practices.
There are many issues to be resolved when you start a new business. Surround yourself with experienced business professionals including attorneys and accountants.