Business Law
Starting a business can be a confusing and daunting proposition. At Baker Williams we can help you navigate this process so you get started on your future success. We can help with creating and registering your business. After you are up and running we can help with legal issues you encounter in the operation of your business. Our firm also works with Veterans starting businesses. Our firm was instrumental in the passage of a bill in 2010 creating a microloan for veteran owned businesses.
Common Business Types
Sole Proprietorship – This is the simplest most common form of business ownership. A sole proprietorship is when one person owns an unincorporated business.
Partnership – A partnership is very similar to a sole proprietorship. It is an unincorporated business with more than one owner. The risks and benefits of the business are shared between the partners.
Limited Liability Company – Better known as LLC’s, this business structure is created by state statute. What is unique about LLC’s is owners have limited personal liability for the debts and actions of the LLC. Depending on the type of business this “limited liability” may be an advantage.
S-Corporation – Prior to the creation of LLC’s this was the most popular formalized business arrangement better known as S-Corps. These are a creation of a section of the IRS code. These are corporations that elect to pass corporate income, losses, deductions and credit through to their shareholders for federal tax purposes.
C-Corporation – These are entities unto themselves and are taxed separately from their owners. Most major companies in the United States are C-Corps .
Each business type comes with certain risks and benefits. Before deciding what type of business is best you should discuss your options with a professional.
5 Things to Consider Before Starting a Business
- Do you have the self-discipline to be a business owner?
Leaving a bad boss or oppressive corporation behind may sound ideal on a long day at work, but do you really have what it takes to be your own boss. There is no punishment for being late to work. There are no quarterly performance reviews. But do you have the drive to show up on time when you only have yourself to answer to? - Are you willing to take risks?
According to the Small Business Association most small businesses fail within the first five years. Of those that manage to make it the five years the majority are not profitable. But for those who have a good plan, focus and drive a small business can be the perfect fit for career fulfillment. - How will you pay your bills while you build your business?
Given statistics it is unlikely you will be able to pay your personal bills from your business on the very first month that you are in business. It is a good idea to have a nest egg before embarking on your business venture. Also having money in the bank puts the new business owner in a better position to secure a loan for your business. - Do you have the time to devote to a developing a new business?
Most people who start a new business keep their day job until the business is established. Will you be able to spend enough of your off duty time on the new business to make it a success? - Are you willing to work long hours for a delayed return?
One thing that is fairly consistent about a new business venture is that it takes many hours of labor to get a business going. As noted in #2 it takes awhile before a new business will pay your bills. Can you keep your entrepreneurial drive going to get to your goal?
These 5 points to consider may seem daunting but being a successful business owner is possible. Despite how some success stories appear all businesses required many hours of work, planning, nurturing and worrying to reach the goal of success. It is doable with the right amount of desire and choosing the right professionals to assist you along the way. Baker Williams attorneys are here to help the small business owner reach their dream of success.