Workers Comp Attorney
If you’re planning to start a small business soon, you’re probably very excited. While owning a small business can be very rewarding, it can also be challenging if you’re not educated about the legal aspect of it. It’s important to learn about the truths and falsehoods about the legal side of small businesses.
Here are a few legal myths to be aware of.
You Must Provide Your Employees With Health Insurance
While business owners are legally obligated to provide employees with health insurance, they only have to do this if they have more than 50 or more full-time employees. If you have fewer than 50 full-time employees working for you, you don’t have to provide health insurance if you don’t want to.
You Have to Form an LLC or Corporation
The law doesn’t require you to form an LLC, corporation or other business structure to go into business. However, it is advisable. If you select a business structure that fits the needs of your business, you will receive worthwhile benefits and protections.
Creating a Business Structure Will Protect You Automatically
Limited liability companies and corporations can shield small businesses from liability. If your business gets sued or incurs debts it can’t pay, just the assets your business owns will be in jeopardy. Your personal assets wouldn’t be taken away. However, in order to receive these benefits, you have to take the necessary steps first. If you want to form an LLC, for example, you have to follow your state’s laws about LLC formation. The requirements differ from state to state. If you don’t meet the requirements, you will not receive the protections.
You Can Always File for Bankruptcy
Many small business owners who struggle to pay their bills believe they can just file bankruptcy and get a fresh start. While bankruptcy can wipe out some debts, it might not get rid of all of them. If you have secured creditors, for example, they may be able to take your collateral. If you fall behind on your taxes, you likely won’t be able to get those debts discharged in bankruptcy either.
It’s Not Necessary to Hire a Business Lawyer
Some businesses don’t think that they have to hire a business lawyer until something major, like a lawsuit, happens. However, it’s actually in your business’s best interest to retain a lawyer from the get go. He or she can help with everything from choosing a business structure to advising about taxes. If you have an experienced business lawyer in Maryland on your side, you’ll be less likely to make costly mistakes.
Thanks to Brown Kiely, LLP for their insight into business law and legal myths about starting a small business.