Starting a small business is both thrilling and challenging at the same time. You want to make certain you have taken care of all the legal requirements necessary to get off on the right foot to ensure the business is on the path to future success of the business.
Here are some things that need to be in place to start a small business:
- Choose a business structure: Decide if the business will be a sole proprietorship, a partnership, a limited liability company (an LLC) or a corporation. Majority of small businesses start out as a sole proprietorship, but there are many advantages and disadvantages to each type of business structure. Understanding the pros and cons of each type of structure will help guide the business owner to making the right decision. The type of business structure will also determine the type of paperwork that will need to be drawn up and filed for your new business.
- Licenses and permits: Determine what licenses or permits the business may need to obtain in order to do business legally. These licenses and permits will depend on the industry and location of the business. Federal, state and county laws determine these requirements.
- Register the business name: It’s important to register the business name, ensuring the name is not violating any trademarks or is already claimed by another business. Checking with the local county’s Register of Deeds office and with the North Carolina Secretary of State’s office to ensure the name is not already in use is vital.
- Employer Identification Number (EIN): The EIN is your business’ tax ID number. It is used to identify the business. Most businesses need an EIN from the IRS if it plans to hire and pay employees, pay taxes and much more.
- Insurance: Getting business insurance is a good way to protect both personal and business assets. Insurance is a great means of mitigating risk involved with starting a small business.
All the legal requirements for starting a small business can be confusing. A lawyer can assist a business owner with meeting all these requirements. Contact Thornton Law Firm and learn how we can help today.