Legal Tips for Startup Businesses: 5 Smart Ideas For New Businesses

Rianne Hunter

January 09, 2014

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Starting a business means that you initiate both a public presence and legal entity. A number of legal concerns can arise during the time of startup and at various points in the growth of your business. Good legal counsel can help you to navigate these problems successfully should the need arise.

Structural and Tax Matters

One of your first legal concerns should be the manner in which you set up your business structure. You may require both legal and accounting advice for the best legal structure for your needs. In some cases, a C corporation offers the best tax advantages. In other cases, an S corporation or limited liability structure can offer the most advantages. You must file these legal documents with the state in which you are going to operate.

Names and Logos

Many businesses get into legal difficulties when they choose a name that is too close to an already established business that has wide recognition. This problem can also occur with the logo of a business, even when they businesses are very different. The known company can then file suit to prevent the new company from continuing to use these designations. Always research the name of your new company carefully to avoid the expense and trouble of having to change your business name and logo.

Obtain Liability Coverage

Protecting your business from common hazards is another important step in any startup. Flooding, windstorms, fire and theft can cause significant losses that can endanger your financial stability and customer care. These losses can even lead to lawsuits that further disrupt your business. Proper liability coverage can help you to weather whatever circumstances arise.

Avoiding Contract Disputes

If your business is engaged in long-term work that requires lengthy contracts, you can get into legal difficulties if your customer feels the contract has been breached. This can a particularly difficult matter if you do business across state lines, where different laws may apply in each state. You need a lawyer that can help you navigate the confusing legal issues that may apply in these cases. You likely need to either find one lawyer or a team that can be there to defend criminal charges in Austin and negotiate at an arbitration session in San Francisco. You can learn more about some of these kinds of issues at sites like HarronLaw.com.

Customer Privacy Concerns

Credit card security and the use of private information such as addresses and phone numbers must be carefully protected to ensure that data does not fall into unauthorized hands. Encryption programs and other security techniques should be a part of your office system to avoid lawsuits regarding careless use of customer information.

Whatever your new business may be, you will likely need to tackle at least some legal issues. You can establish a stable legal foundation for your company, and be prepared for other legal hurdles if you plan ahead for your legal representation and legal services.