Common Business Legal Mistakes
Starting a new business is an exciting venture for any solo artist or entrepreneur. Coming up with the name, drafting a business plan, and getting your LLC are all important milestones that bring you one step closer to your big dream.
However, some of the most common mistakes that new business owners make involve the legalities of operating a business.
Regardless of the industry, or size of the company, investing in professional legal services can help you avoid common pitfalls, so you can position your company toward success!
4 Small Business Mistakes
Below, we’ve compiled a few common legal errors that many small businesses fall victim to—without the guidance and experience of a business attorney.
Not Using the Correct Legal Structure
We mentioned LLC (Limited Liability Company) earlier, but your company may fall under a different business structure. This may include:
- Sole Proprietorship
- S. Corporation
Choosing the correct business structure is one of the first—and most important—steps to starting a company. In fact, before you can even register your business with the state and federal government, you need to choose the right structure first.
In order to make the correct selection, you’ll need to consider several factors that range from whether you are solely owning the company, or if you’re starting a business with a partner or investor, as well as:
- Tax exemptions and reporting
- Personal liability
- shareholder participation
- Distribution of profits
- And more!
As you can already see, a lot of time and research goes into the first step of owning a business. An experienced business attorney can help you navigate this path and find the right business structure for you to help you avoid any liability or tax issues down the road.
No Human Resource Guideline
While it can be easy to disregard human resources when a business has only one or two employees, a growing company must have guidelines for the conduct and success of its team.
Without the proper HR guidelines in place, your company may become liable for any range of employee related issues, including:
- Minimum wage requirements
- Incomplete (or missing) employee records
- No onboarding process
- Failure to conduct background checks
- Errors in payroll
Not Protecting Intellectual Property
Waiting to secure a patent, copyright, or trademark is a very common mistake among new business owners. This should always be done as soon as possible whenever starting a company.
You also need to be sure that the name of your business, as well as branded products or service items are not already taken by a different company. This includes the domain name for the business website and URL.
Not Protecting Your Digital Presence
Speaking of your business website, you must also ensure that your digital platform is protected from hackers and potential scammers.
Protect Your New Business with KTF Law Firm
Working with a small business lawyer can help you avoid these common business mistakes. At KTF Law Firm, our team will guide you through many of the legal concerns you may have (or perhaps you haven’t even thought of yet) and help you stay protected and in compliance with the law, so you can focus on running your business.
Ready to get started? Contact us for a consultation!