why do i need a lawyer to start a business

Hiring a lawyer will help make sure your business is legal and prepared for success. If you’re starting a business, it’s important to hire a lawyer as soon as possible. An experienced business law attorney will understand the legal requirements of starting a business in your state and provide you the necessary paperwork needed to get started.

Full Answer

Do I need a lawyer to start a business?

The most common reasons for needing an attorney are: Navigating the many forms and requirements of legal documents, like incorporation documents, that are involved. Assurance the startup is being done right.

Why do I need an attorney to start an LLC?

The most common reasons for needing an attorney are: Navigating the many forms and requirements of legal documents, like incorporation documents, that are involved.

Do I need an attorney to start a home-based business?

It doesn't require that you register your business with your state, so no, you probably don't need an attorney to start this type of business. No specific paperwork is required other than local business licenses, and even that can depend on the exact nature of your business and your area's unique requirements.

Why do I need a personal liability attorney?

An attorney can help you avoid this situation or minimize your risk. Knowing about your personal liability, and reducing the risk that your business may devastate the economic well-being of you and your family, is well worth a visit to an experienced attorney. See Business Liability to learn more.

Why is a lawyer needed in a business?

A Business Attorney can guide you on the applicable regulations, codes, and laws related to hiring employees or independent contractors. The right legal advice will prevent you from possible claims for discrimination, misclassification of employees, or braking state and federal laws.

Why do startups need lawyers?

A startup lawyer helps your business foresee legal issues and also advised on how to successfully avert them. It is the role of a lawyer to ensure that your business is protected from the beginning. He/She analyses your business, proffers preventive solutions and manages the business risks.

Should I speak to a lawyer before starting a business?

But meeting with a small business attorney before starting a business can be one of the smartest moves you'll ever make. A business lawyer can explain how to start a business and answer your business law questions. But more importantly, a lawyer can identify the risks you face and help you minimize them.

What type of business does not require an attorney to set up?

A sole proprietorship is the simplest business form. It doesn't require that you register your business with your state, so no, you probably don't need an attorney to start this type of business.

How do I choose a law firm for a startup?

Choose a Startup LawyerHow to: Choose a Startup Lawyer. ... Choose a trusted partner. ... Look for a partner whose experience aligns with your needs. ... Initiate an open conversation about priorities and response time. ... Decide whether to partner with a big firm or a small firm. ... Ask about fees. ... Questions for prospective lawyers.More items...

Who should I talk to about starting a business?

5 People You Should Talk With Before Starting a BusinessYour spouse. One of the first people you should talk with about this new venture is your spouse. ... A lawyer. Starting a business involves a few legal hoops, so you'll want to talk with a lawyer. ... An accountant and trusted advisor. ... A business coach or mentor. ... A banker.

Where can I get advice for setting up a business?

England. You can contact the government's Business Support Helpline for free advice relating to your business / idea. You can also find free support, guidance, advice and sources of finance through your local 'Growth Hub'. If you are looking for business support or guidance, your local Growth Hub is there to help you.

What's the difference between attorney and lawyer?

Attorney vs Lawyer: Comparing Definitions Lawyers are people who have gone to law school and often may have taken and passed the bar exam. Attorney has French origins, and stems from a word meaning to act on the behalf of others. The term attorney is an abbreviated form of the formal title 'attorney at law'.

What is better LLC or sole proprietorship?

A sole proprietorship is useful for small scale, low-profit, and low-risk businesses. A sole proprietorship doesn't protect your personal assets. An LLC is the best choice for most small business owners because LLCs can protect your personal assets.

What are the 4 types of business?

There are 4 main types of business organization: sole proprietorship, partnership, corporation, and Limited Liability Company, or LLC.

What does LLC mean in business?

limited liability companyKey Takeaways. LLC stands for limited liability company, which means its members are not personally liable for the company's debts. LLCs are taxed on a “pass-through” basis — all profits and losses are filed through the member's personal tax return.

What can a lawyer do for a business?

A lawyer can review your business plan and flag issues of concern. Or they can draft your plan for you. Since a sound business plan is critical to get a business loan or investors on board, it is worth the investment to have an attorney review it.

What can a business attorney do?

A business attorney can help you draft documents and agreements for your business. For example, when you start your company, you may need an operating agreement or bylaws.

How can a tax lawyer help you?

Tax lawyers can also advise on business strategies to reduce taxes. For example, they might recommend launching or expanding your business in one state instead of another. As a result, you might save thousands of dollars in taxes by paying a few hundred in legal fees.

Why is it important to have an attorney for a partnership?

Equally important is addressing how a partnership may change as the business grows (i.e., one partner wants to leave the company). Again, enlisting the services of an attorney will define the relationship and avoid future conflicts.

What is the best legal advice for a business?

Probably the best legal advice a business attorney can give is how to correctly set up your company to minimize your taxes and business liabilities. An attorney can show you the advantages and drawbacks of your business formation to tailor the right one for you.

What to do if you have employees?

If you have employees, you will want employment agreements spelling out the terms of the working relationship. Additionally, you want to avoid potential lawsuits if you need to discipline or terminate the employee.

What is a business plan?

A business plan starts with a mission statement and then outlines the framework of your company. You identify your market, customer base, business opportunities and challenges, projected costs, profits, and how you will fund your business. There are several online templates you can use to draft your business plan.

Can you save money by doing things yourself?

You can save a lot of money, and you'll learn a lot from the process of doing things yourself.

Does the Balance provide tax advice?

BizFilings and LegalZoom offer most documents, which might serve you well if your business is not particularly unique. The Balance does not provide tax, investment, or financial services and advice.

Do S corporations have to register with the state?

Corporations or S corporations must register with the state as well. They must prepare bylaws and other documents, and they have a far more complicated ownership structure. You'll almost certainly need an attorney to help you start any type of corporation, An S-corp starts as a corporation then elects S corporation status with the Internal Revenue Service. If it sounds complicated, it is. You might need help.

Do LLCs need to register with the state?

Partnerships and LLCs must register with the state. Documents must be prepared, such as a partnership agreement or an LLC operating agreement. You might be able to register online with your state or use an online service to register your business, but it might be a good idea to use an attorney if your business is at all complicated.

What does a lawyer do for a business?

Ensure compliance: A lawyer can help make sure that your business opens and operates by federal, state and local laws.

How can a lawyer help you?

Establish agreements: A lawyer can help you establish formal legal documents that govern relationships across the organization . This way, you know what you owe to your partners, employees, vendors, customers or clients and their deliverables in return.

What is the purpose of picking a business name?

Picking a business name: An attorney can perform the research needed to ensure that the name you give your business is not in use by another business or trademarked. Operating under an already trademarked name can cause financial and legal woes down the road.

What can a master tax attorney do?

Master taxes: Attorneys trained in tax can help ensure that you pay the tax you owe; they can also help lower your tax liability by identifying valid business deductions and reimbursements.

Can a lawyer help you patent a business idea?

Patenting a business idea: A lawyer can help advise you about how to keep your patent confidential, search for and avoid duplicate patents already filed with the U.S. Patent and Trademark Office, and file a patent application.

Is a partnership agreement mandatory?

More importantly, creating a partnership agreement for partners to enter into , while not mandatory in most states, is strongly urged. You can also file these forms yourself through online legal services.

Do I need a lawyer to start a small business?

Retaining the services of a lawyer is not required as a condition of starting a business. In fact, many of the steps of starting a business cited above can be performed without a lawyer. This means the decision to hire a lawyer or go the DIY route depends on your business entity. Also, consider the amount of time and effort you are willing to expend to get your business off the ground.

Why do lawyers make less sense?

The biggest reason lawyers can make less sense generally is cost. If you have unlimited capital, then you can save time by hiring a great lawyer (in the same way you’d hire an expert for everything else, like SEO, marketing, design, sales, etc.).

Why Does Legal Matter So Much in the Beginning?

If you wait too long, then when you need the contract, it’s too late. No one’s soon-to-be ex-spouse is going to agree to a prenup when she’s about to get a divorce. And no one will agree to a contract after the conflict has already occurred.

What is the vast majority of US businesses?

The vast majority of US businesses are service-based businesses. In general, service-based businesses face less liability. If you’re in a field with high malpractice concerns, you’re exposed to more liability but at the same time -- insurance often covers that.

What is legal basketball?

Legal is like the rules of a game. It eliminates ambiguity. Except business laws have a rule book about 1,000x bigger than the rules in the NBA. Imagine focusing all your energy on learning how to shoot, assuming you can carry the ball (without knowing to dribble) anywhere you go -- when you play your first game, you’ll be at a huge disadvantage and have to stay in one place.

Can a business infringe on another business's trademark?

Most new businesses overlook trademark implications that exist from the start. When you register your business, it can't infringe on another business's trademark. Just because your name was available in your state doesn't mean it's not infringing on a trademark.

What can a business lawyer do?

An experienced business lawyer can help you avoid mistakes of which you were not even aware.

Why is it important to have a lawyer on your team?

Having a lawyer on your team can tilt the field to your advantage in the event of a lawsuit. If you are threatened with legal action, having a lawyer already on your team means that he already knows your business, which allows him to hit the ground running. Even more importantly, a savvy business lawyer will have constructed your business ...

What to do if a client owes you money?

If a client, vendor, partner, or other associate owes you money and is dragging his feet on the matter, by simply asking your lawyer to send a request on your behalf, you can motiva te immediate action. In the event that this alone is not enough to convince the individual to pay, your lawyer will know what your next steps should be in order to collect the money you are owed.