I realize this might be an unpopular opinion but the reality is when it comes to running your business, what you don’t know can and absolutely will hurt you in the end. As an attorney for small businesses and online entrepreneurs, I have made it my life goal to ensure you do know what can hurt you from a legal aspect. So I put together a great business audit that you can review that is going to go over some of the major areas of law that you have to be on top of as you grow your business. You can download that here. But if you’re not interested in the whole shebang just yet, I thought we could do a little preview here first. This way maybe you’ll believe me when I say, what you don’t know can hurt you.
8 Things You Should be Asking
Now, these questions are going to be very different from the ones in my legal business audit (link it here too). I am just using them as an example of the areas in which your business might face a legal risk. Think of these as an overview of what’s in the audit- a helicopter view if you will. The audit, that’s boots on the ground investigating what is going on in your business.
1. What type of business are you? Sole Prop? LLC? Corporation? Do you know the differences and why one is better suited for your business than the others? Do you know how to set this up, and what steps you have to take after such as getting an EIN and a bank account?
2. Are you taking the proper steps to keep your personal and business life separate? There is this thing called “piercing the corporate veil” which essentially allows a court to find you personally liable for actions of your business if you fail to keep your business and your personal life separate. This includes having separate bank accounts, having a business entity, holding the required meetings and following other corporate formalities. Be sure you know what formalities these are and that you are taking the proper steps to protect yourself.
3. What is your likelihood of being sued? Every business carries some liability. However, there are industries and businesses that carry more than others. Do you know what your risks are? Are you capable of identifying the liabilities inherent to your business? If the answer is no, you may want to contact an attorney.
4. What Contracts do you need? This is going to be very dependent on what you do, and who you work with. So as always, I recommend working with an attorney on this but it is important to know that if you’re in business in any industry or capacity, you must utilize contracts to protect yourself and your assets. And, most likely the online contracts you find and download won’t pass muster, so if you can avoid taking the easy way out, you really should.
5. Is your intellectual property protected? Have you registered your trademarks? Can you even do so? Are you using copyright notices and registering your important copyrights? Worse, are you misusing someone else’s intellectual property? Do you know when the right time to register your trademarks or copyrights is? So many issues with just your intellectual property! And, it is one of your most important assets. Don’t let this one slide.
7. Are you handling your taxes appropriately? This will change depending on the entity you are set up as, but failure to properly handle your federal and state taxes can result in some serious trouble for you and your business. Be sure you are on top of this and work with a tax attorney and CPA to stay protected.
8. Are you hiring help? Employees and independent contractors are amazing for business growth and productivity but with that comes a whole host of legal risks that you need to be aware of. Classifying your workers appropriately and utilizing contracts to define these relationships should be where you start. But, definitely not where the inquiry ends.
So there it is birds-eye eye view of some of the issues your business needs to be on top of or else you risk running into some serious legal troubles. I can’t possibly go over everything in one blog post, or even in one legal business audit. But, I can arm you with the questions and hopefully get you thinking of what areas you need to work on in your business. And by work on, I mean work with an attorney on protecting yourself and your assets. There is no reason to work so hard on your business if you aren’t able to keep it afloat due to legal trouble. So, download the audit, find out where you need help, and contact me or someone in your area when you’re ready to get legally fit!
Have more questions? Feel free to email me at Shannon@montgomerypllc.com and llet’schat!
Please note that this is not meant to be legal advice for you or your situation, this is merely some legal research and knowledge on the given topic.