If you are following your dream and starting a small business, you may feel overwhelmed by the legal elements involved. You might consider hiring a lawyer to help, yet doing so may seem too costly, especially when you’re first starting out and money is tight. However, obtaining an attorney’s advice at the beginning of your new venture could help avoid potential problems and may save you money in the future.
5 Ways an Attorney Can Help When You Start Your Business
There are many elements of a new business that probably don’t require an attorney’s expertise. These are tasks you can probably do yourself—developing a business plan, researching and choosing your business’ name, reserving a domain name for your new website, and interviewing and hiring employees.
However, other matters can be more complicated, and you may not understand the legal liability issues that an experienced attorney can explain. You may want to consider hiring a business lawyer for the following:
To help determine your business structure.
An attorney can help you decide whether to organize your business as a sole proprietorship, corporation, a limited liability partnership, or a nonprofit and can properly prepare the legal documents for you. This decision could affect your personal liability, tax obligations, setup costs, ongoing fees, and avenues to obtain funding.
To help handle contracts.
Your business will be entering into contracts with other businesses or individuals. An attorney can help you negotiate favorable terms; review proposed contracts and suggest additional clauses to protect you; and draft contracts that define the parties’ responsibilities and what happens if a party breaches the contract. Entering into well-drafted contracts can avoid disputes and expensive litigation in the future.
To help explain tax liabilities and handle required licenses.
While you could need an accountant for detailed tax advice, an attorney can provide a general idea of your business’ tax liabilities and assist you in becoming properly licensed. In addition, an attorney can help you obtain federal and state tax id numbers for your business more quickly than you can probably do on your own.
