Common Legal Problems Washington DC Small Businesses May Face
If you are an owner of a small business, you may feel you’re in over your head sometimes. Legal problems when starting out can cripple your business, both financially and physically. Some people mistakenly assume that a small business doesn’t have a need for an attorney, but that is not entirely true. Washington DC small business attorneys can help you set up your new business as well as handle legal issues that arise down the line. Here is a look at some of the more common legal problems a small business might face.
No Business Structure
One of the biggest mistakes you can make is not creating a formal business structure. Your business can be anything from a sole proprietorship or partnership to a limited liability company or corporation. Creating the right business structure may also help protect your personal assets in some cases as well.
Failure to Adhere to Tax Laws
Taxes can be confusing as an individual, but they can be even more confusing if you own a business. If you fail to follow all the federal and state tax laws, you may end up owing a lot of money in penalties. Your liability will continue to grow until you set up an agreement to handle it.
Not Purchasing Insurance
Some small business owners assume they don’t need insurance because they are small or just starting out. Purchasing general liability insurance is important, even if you are a sole proprietorship. If your business has employees, you may also need to purchase a number of different coverages, like workers’ compensation, vehicle insurance, and/or product liability insurance, etc.
Not Protected Intellectual Property
Some business owners mistakenly assume that only large corporations need to worry about intellectual property. Intellectual property deals with patents, trademarks, copyrights, etc. Registering your intellectual property helps ensure you maintain a competitive edge, and it keeps other people from trying to use your technology for personal financial gain.
Employee Contracts that Can’t Be Enforced
If you are hiring employees under an employment contract, you need to make sure these contracts can be enforced. This is one of the ways a small business attorney can be of assistance. If your employment contract has a noncompete clause that applies in the event someone leaves or is terminated, you may end up with added legal expenses if you take it to court to enforce it. Drafting a comprehensive employee contract from the start can help increase your chances that a court will enforce it.
Not Following all Employment Laws
Following all federal and state labor laws is extremely important, otherwise you run the risk of having an employee take you to the labor board or file a lawsuit against you. A skilled business litigation attorney can help you draft an employee handbook with policies and procedures, or help you review your existing handbook.
If you have questions about forming a new business or need legal assistance with your existing one, please contact the team at Tobin, O’Connor and Ewing in Washington DC at 202-362-5900 to schedule a consultation.