Founding a new business can be an exciting opportunity for anyone, but it is important to understand that there are many risks and problems that can arise for business owners. Whether it is facing a lawsuit from an injured customer or dealing with internal disputes among ownership, it is important to understand that there are a couple of tips you can use to make sure that you avoid making some legal oversights.
Incorporate Your Business
One of the most important steps for protecting your personal assets from lawsuits is to incorporate your enterprise. Corporations are largely considered separate legal entities, and as a result, individuals suing the company may have a more difficult time coming after your own personal assets.
Unfortunately, there can be a bewildering assortment of different classes of corporations. Whether it is an S-Corp or a limited liability corporation, each class of incorporation can provide unique advantages and challenges that must be carefully weighed. Before making a decision, it is advised to speak with a business law attorney and accountant. These two professionals will be able to help you understand both the legal protections that come with forming a corporation and the tax implications that this decision can have.
Create A Succession Plan For Investors, Shareholders And Partners
Starting a business can be a remarkably expensive endeavor, and it should come as no surprise that, many times, multiple individuals will need to pool their resources to start the enterprise. In instances where a company has more than one owner, shareholder or partner, it is important to create a succession plan. This plan details how each partner in the business can liquidate their share of the enterprise, and without it, all the owners and investors would have to enter negotiations whenever someone wanted to part with their portion of the company. Due to the complexity of creating these succession plans, you may need to consider Hiring an attorney to help you avoid making mistakes that could void the succession plan if it were to face a legal challenge.
Managing the risks that come with starting a company can be one of the more stressful aspects of deciding to open your own business. However, it is common for people to be unsure or unaware of their options for address this need. Realizing the benefits of incorporating your enterprise as well as the dangers of not having a succession plan will help you to get your new enterprise started on the right path to success.
For a business law attorney, contact a law firm such as Souders Law Group.