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In its early stages, any business could benefit from the guidance of experienced legal counsel. From determining the appropriate legal entity to ironing out terms with co-founders, careful legal work on the front end could reduce conflicts in the future. An experienced business law attorney could help with each of these important decisions.
Before you take the steps necessary to form your new venture, ensure that you are proceeding carefully. A Washington, DC business formation lawyer could guide you toward the right path for your new venture.
When creating a new business, there are a number of important considerations that should remain at the front of a entrepreneur’s mind. The failure to carefully develop a business formation strategy could result in an entity that faces tax issues or leaves the owners personally liable for its debts.
One of the ways an attorney in Washington, DC could help in the early stages of business formation is by developing an internal structure. In the excitement of creating a new business, it can be easy for some people to forget the importance of a formal business structure and the identification of the roles each person is intended to fulfill.
An important part of business formation involves dealing with future tax consequences. Some entities, like LLCs, are pass-through entities that do not pay any taxes directly. Other entities, like corporations, must not pay taxes on their profits. This aspect of business formation is important, as the choice of business entity could result in double taxation. In addition to corporations taxing profits, the owners may also face tax liability on their income.
One of the major benefits of operating a business as a legal entity is protection for personal liability. A person that does business in their own name risks creditors reaching their personal income and assets. With the right business structure, an owner could avoid personal liability.
Avoiding personal liability requires more than simply picking the right business entity. Additionally, the owner of a business must take steps to operate the business as a unique entity as opposed to it serving as little more than a liability shield. An attorney in Washington, DC could provide helpful guidance on avoiding liability as a business owner during the formation process.
One of the critical steps early in the business formation process is the selection of a legal entity. There are numerous types of legal entities to choose from, and they each have their own advantages and disadvantages. Some business entities shield owners from personal liability for the company’s debts while others do not. Some of the most common entities used to form new businesses include:
Selecting the appropriate legal entity for a new venture could put the new company on the path to success. A Washington DC lawyer could help an entrepreneur determine which legal entity may work best for their business during the formation process.
The formative stage of a new business is one of its most important phases. Avoiding errors at this stage could prevent long-term hardships or the failure of the business in the future. If you are preparing to form a new business, the guidance of an attorney could help you avoid crucial mistakes. Reach out to a Washington, DC business formation lawyer today to learn more.
The Law Offices of Jay Gupta
