Many people take the new year as an opportunity to pursue new endeavors. For many, that means starting a business.
Whether you are launching a business in 2017 - or thinking about it - you will want to make thoughtful, informed decisions. Proper planning for your business idea is the cornerstone of a successful, sustainable business. Here are some things to keep in mind:
- Create a business plan: A business plan details the goals of a business and strategies for reaching them. Creating a business plan can be a time-intensive process, but the effort is worth it. The Small Business Adminisration provides guidance for creating a business plan.
- Determine financing: Figuring out your business financing is a critical step and should be done at the earliest possible time in the business planning process.
- Determine how to structure your business: Determining which business entity to file under (sole proprietorship, partnership, LLC, LLP, etc.) is an important decision that has tax and other implications. An attorney, along with your CPA, can help you determine which entity is most appropriate. Once you determine the entity, you need to document it with partnership agreements, by-laws, operating agreements, and the like, as is appropriate.
- Register a domain name: Having a website is critical to operating a business. You can do a domain name search here to find out if your desired domain is available.
- Apply for an Employer ID Number (EIN): An EIN is used by the IRS to identify your company. It is used similarly to how an individual uses a Social Security Number. You can apply for an EIN here for free.
- Prepare business contracts: The type of contracts needed vary from business to business. Some important agreements are: employment agreements; vendor/supplier agreements; master services agreements; distribution agreements; and independent contractor agreements. Talk to an attorney to determine what contracts are needed to protect yourself and your business.
- Beware of form agreements to document or protect your business: Business entity forms and contracts are available online or sometimes supplied by CPAs. Knowing when and how to alter these forms is typically something only an experienced lawyer can properly do. Many business disputes are the result of poorly drafted or understood form agreements.
- Run everything past an attorney: You will invest a lot of time and money in your business. It is important to ensure that your legal bases are covered as you move forward. Working with an experienced attorney is essential to protect what you are creating.
Questions? Schedule a consultation with a business law attorney at Chenoweth Law Group, PC, by calling 503-446-6261.