Starting a business is nothing like what it is in the movies. Usually, one character has a great idea and then 10 seconds later, they’re already up and running. Now, we recognize the creative spirit that Hollywood has and putting in hours and hours of paperwork and meetings just wouldn’t flow.
One of the parts that many future business owners dread is the legal side. Many times, there are so many hoops to jump through that people resort to levitating in order to get through them all. There is already so much to think about and adding in legal mumbo-jumbo can confuse just about anyone.
It’s definitely the smart idea to consult with a business lawyer or other industry expert, there are some things that you can take care of yourself.
One night, it just comes to you: the perfect business name. After sitting at a desk and being surrounded by crumpled up pieces of paper, you’ve finally got it! You go ahead and make your business name, choose a great logo, and settle on a website address.
A few days later, you receive notice that that business name is already chosen. There goes your perfect name, logo idea, and website address. You cannot register a business name that another organization already operates under.
Above all, you don’t want to throw yourself into a legal battle by violating a trademark. The easiest step to take is by using a free trademark search. There are millions of trademarks filed each year and you don’t want yours to conflict with anybody else’s.
Have A Legal Business Structure
When it comes to choosing a business structure. The most common for small businesses is going the route of an LLC, or limited liability company. LLCs are popular, because this structure gives you some liability if you are unable to pay bills or you happen to default on a contract. They are not the easiest to manage, but you’d rather have some form of protection instead of none at all. In this case, it’s best to meet with a CPA or advisor to discuss your options and see which is best for you and your case.
Protect Your Back
It pays to be prepared, right? Having business insurance is going to keep your business protected no matter what the outcome may be. Even though it may seem like a big expense at first, you’ll be happier to have it in the future. Research your area to reach out to an insurance broker.
It’s not just insurance that can cover your back, but contracts. Having contracts written up early so you can hire employees, work with contractors, investors, and anyone else that may come your way. Contracts give you legal support to fall back on if anything doesn’t go your way.
Check Tax Requirements
Additionally, check tax requirements to ensure you start your business legally. Tax requirements typically fall into three categories. You need to check into all of them. Firstly, familiarize yourself with the federal tax requirements. Most entrepreneurs pay close attention to these requirements, but fail to review the other two types of taxes. These include state and local taxes. Check these requirements along with federal business tax obligations. Tax requirements play a crucial role in starting your business legally.
Obtain A Tax ID Number
The first thing you do when filling out your taxes is providing your social security number and your name. Your business is also going to have to file taxes, and it’s going to need an EIN number to do so. Your EIN, or employer identification number, will be used for plenty more than just taxes. You’ll need it for the bank and to hire employees. Obtaining one is easy and can be done for free on the IRS’ website.
Inquire About Zoning Laws
Furthermore, inquire about zoning laws when starting a business. Many entrepreneurs choose their company location based on population and popularity. These factors do play a role in a company’s success. However, you also need to review the location’s zoning laws to ensure that you can legally operate there. Keep in mind that local zoning laws change. You cannot assume that a location is legal just because other companies operated there. Reach out to local authorities for zoning law information. Then, you can start your company without breaking any laws.
Don’t Forget About Permits
Depending on your business, state of residence, and even city of residence, you may need various permits to operate. These could be anything from safety permits to health permits. Not having them could be bad news for your business, resulting in a fine or being shut down.
In order to find out which permits you need, head to your local office to make sure you have everything covered. This likely means waiting around in lines or on hold, but it’s better than the alternative of losing your business due to an oversight.
Research Employer Laws
Eventually, you’re going to have to hire people. Hiring people is exciting, but there are a whole host of legal issues that come with it. Both you and your employees are going to have various rights and responsibilities that will need to be upheld.
For instance, there are certain questions or language that you can or cannot use during an interview. You’ll also need to be up to date on all OSHA requirements. While you don’t have to know these laws as well as your back hand, it’s important to have the basics down.