Your Small Business

There is strong evidence that with the uncertainty of the economy, job insecurity, high unemployment rates and long waits to find a job, many people are searching for ways to create a lasting source of income. There are reports that many people are trying some form of network marketing - even some of the big names are involved in network marketing, while others are launching some small business venture. If you have a great business idea, now may be the right time to launch your business. As you contemplate launching our business, you need to think about how you will operate and what forms of protection you will put in place.

Although I cannot advise as to what type of business structure you should set up or what tax laws you need to be mindful of, there are some facts that I can share with you.

As a potential business owner, you can choose to operate as a sole proprietor, general partnership, limited partnership, limited liability partnership, limited liability limited partnership, limited liability company (LLC), or a corporation. You can get up and begin operating as a sole proprietor or join with someone to run a general partnership with not too much bother. (In some cases you may be required to obtain a business license.) However, all the other forms of business are governed by law. That is, you must follow statutory guidelines to create and register your business before you begin operations.

The business structure that you choose will determine the amount of personal liability to which you subject yourself and will also attract certain tax liabilities. To get additional information on what amount of protection each business form offers, see the respective state's statutes, or the IRS' website. You will find that a sole proprietorship and a general partnership offer the owner the least amount of protection.

After deciding which business structure to use, you will generally check with the state's Secretary of State Office to register your business. Note that the Secretary of State is not a legal entity and will not offer legal advice. You must seek an attorney's help with all legal questions. In addition to registering with the Secretary of State, some business owners may be required to obtain a business license from a local county or city. Additionally, depending on whether or not you will hire employers, sell products, etc., you may need to submit applications to the Department of Revenue.

If you want to know what forms must be filed with a respective Secretary of State Office, visit their website. Once again, an attorney is the best person to tell you which form to file and if you need to draft a document, only an attorney can accurately do that pursuant to statutes. However, I will add that you can always visit your Secretary of State's website to see what forms are available there. Many states attach detailed instructions to their forms which will offer some guidance on how to complete the document and will tell what if any other forms should accompany that particular application.

So, if you are planning to start a business, check with an attorney, a specific state's statutes or the IRS' website irs.gov for guidance on which business structure to adopt and what amount of protection each structure offers. Also, if you do not have ready access to an attorney, check with your Secretary of State's website for whatever information is available. However, to ensure that you are operating within the law, check with an attorney.

I wish you the very best with your business.