Starting a new business is an exciting time, but it can also be overwhelming. There are countless decisions to make, forms to file, and legal considerations to keep in mind. Amidst all the excitement, it can be easy to overlook the importance of properly setting up your new business from a legal standpoint.
However, failing to do so could have serious consequences down the road. In this blog post, we will discuss the various legal considerations you should keep in mind when starting your new business.
Protecting Your Personal Assets
One of the main reasons to set up your business legally is to protect your personal assets. When you start a business, there is always a risk that something could go wrong.
If your business is not set up as a separate legal entity, your personal assets (such as your home, car, and savings account) could be at risk if the business is sued or cannot pay back its debts. By setting up your business as a limited liability company (LLC) or corporation, you can protect your personal assets from these risks.
Establishing Your Business Structure
Another important legal consideration is establishing the structure of your business. There are several different types of legal structures to choose from, including sole proprietorship, partnership, LLC, and corporation.
Each structure has its own pros and cons, so it is important to choose the one that makes the most sense for your business. For example, if you are the sole owner of your business, a sole proprietorship or LLC may be the best option. If you have partners, a partnership or corporation may be more appropriate.
Registering Your Business
Once you have chosen a legal structure for your business, you will need to register it with the appropriate government agencies. This usually involves filing paperwork with the state in which you will be doing business.
Depending on the type of business you are starting, you may also need to obtain certain licenses or permits before you can begin operating. Failure to properly register your business could result in fines or other legal consequences.
Managing Your Taxes
Taxes are another important consideration when setting up your business. Depending on your legal structure, you may need to file a separate tax return for your business. You will also need to fill out forms with the IRS to obtain an employer identification number (EIN).
Additionally, you will need to collect and remit sales tax if your business sells goods or services that are subject to sales tax. Failing to properly manage your taxes could result in penalties or even legal action.
Protecting Your Intellectual Property
If your business creates any unique products, services, or content, it is important to protect your intellectual property. This can be done by registering trademarks, copyrights, and patents with the appropriate government agencies. If you fail to protect your intellectual property, it could be stolen or copied by others, which could harm your business.
Working with an Attorney
Setting up your new business can be a complicated and confusing process. It is always a good idea to work with an experienced business attorney who can guide you through the various legal considerations and make sure you are setting your business up for success. An attorney can help you choose the right legal structure, register your business, manage your taxes, and protect your intellectual property.
In conclusion, setting up your new business legally is incredibly important. Doing so can help you protect your personal assets, establish the right business structure, register your business, manage your taxes, and protect your intellectual property. It can also help you avoid fines, penalties, and legal action down the road. If you need help setting up your new business, consider working with Bauer & Shekerlian, a team of experienced business attorneys who can help you every step of the way.