From one small business to another, we know that running a small business requires a delicate balance of hard work, passion, creativity, and adherence to inevitable obligations.
And on top of that, navigating the new business legal landscape can be daunting.
We know it’s not the most fun part of starting your business, but by understanding the new laws affecting you and perhaps getting support with the paperwork and compliance needs related to them, you protect your business.
This blog will help you do just that. Keep reading to learn some essential tips to help you run your small business legally and set the stage for long-term success.
Register Your Business:
It may seem basic, but many people begin a small business without registering it. We urge you not to fall into this path to protect yourself and your business.
When you fail to register your business, you may be personally liable if someone sues you or things go south. It will also impede you from accessing critical business assets, like business bank accounts, loans, or other resources.
So, begin by registering your business with the appropriate government authorities. This process establishes your business as a separate legal entity and ensures compliance with local regulations.
To do so, research the specific requirements for your business structure, such as obtaining an Employer Identification Number (EIN) from the IRS or registering your business name with your state and local government and then file the paperwork and documentation needed.
If that sounds like too much, many law firms, especially ones like us that specialize in small business support, can help you.
Understand Tax Obligations:
Complying with tax regulations is critical for any small business, as annoying as it may be.
For each business structure and industry you have specific tax obligations to learn and comply with.
For most, you’ll need to maintain accurate financial records, including income, expenses, and receipts, but every state and industry has its own rules you’ll need to learn. Consider consulting with a tax professional or accountant to ensure proper filing and payment of taxes.
Obtain Necessary Licenses and Permits:
Certain industries require specific licenses and permits to operate legally.
When starting your business, you’ll want to research and identify the licenses and permits relevant to your business. Examples may include professional licenses, health permits, or zoning approvals.
And note that you’ll need to understand the local, state, and federal requirements, and obtain the necessary documents to demonstrate compliance. Plus, generally you’ll need to regularly review and renew these licenses and permits to ensure continuous legality.
A law firm can help with these documents and compliance needs if that feels helpful to you.
Comply with Employment Laws:
If you have employees, or plan to hire in the future, understanding and complying with employment laws is crucial.
This looks like familiarizing yourself with laws related to hiring, wages, working conditions, and termination.
It may mean creating clear employment contracts, outlining job responsibilities, compensation, and benefits.
Labor law is always changing, so you’ll need to stay informed about changes and adapt your policies accordingly. This is one reason many small businesses decide to have a law firm on retainer – so they can be regularly informed about changes and/or ask their employment questions as they arise and things change.
Protect Intellectual Property:
Often forgotten by small business is the need to protect their Intellectual property (IP). Many times your IP IS your business, so it is crucial you protect it.
IP includes things like trademarks, copyrights, patents, and trade secrets. Safeguarding your IP rights is vital to protect your brand, products, and creative work.
You’ll want to consult with an intellectual property attorney to understand the best strategies for protecting your intellectual property now and in the future.
Plus, they can file necessary applications for trademarks or copyrights and implement measures to keep trade secrets confidential for you.
Establish Clear Contracts:
Lastly, many small business owners feel overwhelmed by creating contracts (or asking clients to sign them), but the hard truth is: contracts are essential for outlining expectations and protecting your business interests.
One “bad” contract (or even worse, not having one!) can end a business.
You’ll want to create well-drafted contracts for various purposes, such as client agreements, vendor contracts, or partnership agreements to keep you protected.
We’d suggest you seek legal guidance like Ebony Law to ensure contracts are comprehensive, enforceable, and reflect the specific needs of your business. Really creating clear contracts minimizes the risk of disputes, establishes strong legal frameworks, and protects your business’s rights and obligations.
So there you have it. As much as it may not be top of mind, running your small business legally is essential for its long-term success and sustainability. By implementing these tips, you can ensure legal compliance while focusing on your business growth. And if you feel you need help with these items, we’d be happy to add you to our list of happy business owners we support!