Although companies usually try to shore up their legal obligations when they first start out, unfortunately a bunch do so in a way that leaves them exposed to liability. Rather than listing the steps businesses should take (Alexandra took care of that), I’ll list what NOT to do:
- Don’t too late. It’s important to incorporate / form your business in the very beginning. Business owners that put off this crucial first step are opening themselves up to personal liability.
- Don’t choose the wrong business entity. The formalities and rules for each entity differ so it’s smart to fully investigate the appropriate structure for your company. It’s worth noting that in some cases it can be difficult and expensive to change your structure down the road.
- Don’t choose the wrong jurisdiction to set up in. It might make sense to just form in your home state. It might make sense to form in Delaware or Wyoming. It’s worth some time and $$$$ to figure it out.
- Don’t allow your (IP) to get away. You may not have the funding to apply for a patent or trademark, but there are other avenues to take. The worst thing to do is sit back and hope that others won’t infringe on your stuff. Protect it – it can be some of your company’s most valuable assets.
- Don’t neglect your corporate formalities / tax responsibilities.Depending on your business entity or industry, there are probably other things to take care other than filing a cert of incorporation and obtaining an EIN. A young business can’t afford to be stricken with a tax levy or deal with piercing its corporate veil so make sure your company is doing what its supposed to.
- Don’t go without a agreement – especially as an online business. You need to cover your business’ liability and these agreements do a pretty good job at doing that.
Interested in having an experienced business attorney guide you through the compliance steps? Stop by. We offer free consultations and/or quick & easy price quotes to all sized and aged companies looking to speak with an attorney. Check us out!