Small Business News
Issue 10 Volume 1
Running a small business is complicated. Sometimes important tasks fall through the cracks, which leads to mistakes that could jeopardize your business. Understanding and avoiding these common mistakes may help you avoid major legal complications. If you need any legal assistance call your law firm.
- Know the laws that apply to your business. Failing to properly register or license your business could lead to fines or legal action. State laws vary greatly so it is important to research how your industry is regulated in any states and localities where you do business. Call your lawyer if you have questions about the laws that apply to your business.
- Always make agreements in writing and have them reviewed by an attorney before you sign. Written partnership agreements, commercial leases, independent contractor agreements and other business contracts help prevent disagreements and potential litigation. Having your law firm review an agreement before you sign will help protect your best interests.
- Make sure you have adequate insurance to protect your business. There are many insurance options for small businesses, including general liability, professional liability, product liability, commercial property and home-based business insurance. It is important to carefully examine your potential liabilities and make sure you have the right coverage. Your law firm can help review a policy before you sign to make sure you understand the fine print.
- Properly differentiate between employees and independent contractors. It is your legal responsibility to establish whether a worker should be classified as an employee or an independent contractor. Incorrectly classifying an employee may have significant tax implications for your business. .
- Keep detailed and well organized business records. No matter the size of your business it is important to accurately maintain your records. Keeping copies of contracts, sales receipts, employment records and invoices will help you stay organized and keep you on the right side of the law. Well-maintained records will also help you accurately prepare your tax filing.