State laws govern formation of a limited liability company (LLC). Differences from state to state relate mostly to filing requirements. If you’re thinking about forming an LLC for your new business, the structure and advantages are basically the same across all jurisdictions. An LLC is well-suited to smaller businesses, but you can form one for almost any business endeavor other than banking or insurance.
Intellectual property isn’t tangible. Although it’s not typically something that you can hold in your hands, it belongs to your business just the same. It’s as real as any piece of equipment. A variety of laws protect it against theft by other businesses or individuals.
Business can be a dog-eat-dog world. Often, there’s stiff competition between companies. They compete for things like market share, selling more of their goods to the public than a competitor or maybe for government contract work.
How does a business keep its edge against the competition? It’s common for employers to require their employees to sign a non-compete contract. In fact, you may have signed one when you were hired, or when took a promotion. There may have been one in your severance package. If you’re being laid off or changing jobs, you should know if you have non-compete and what it means.
You hoped it would never happen, but in the back of your mind, you knew it could: Your small business is being sued. Whether it has been filed by a current or ex-employee, client, vendor or even another business, a lawsuit against your company will likely cost you a lot of money… whether you win or lose. It’s normal to feel overwhelmed, upset, and indignant, but if you want to keep your business and it’s reputation intact during this time — it’s important to handle every step of the process carefully.
For businesses with more than one owner, the importance of a buy-sell agreement cannot be overstated. Events such as the death, incapacity, retirement or even divorce of one of the owners (“Triggering Events”) can sink a business if the owners have not entered into a buy-sell agreement. Unfortunately, most small business owners do not have this vital agreement in place.
Most employees in this country work at will. This means they can quit at any time, with or without notice, and their employer can fire them at any time, with or without notice, for any reason that is not illegal. If you have an employment contract, however, it might change the at-will employment relationship.
An estate plan for your business can control the transfer of your business or its value to the next generation. Estate planning allows you to make gifts, ensure business continuity, and avoid taxes. Your plan of action will depend upon whether you want to transfer control of your business interest before or after death and whether you are transferring a functional business to a successor or liquidating your interest and giving the proceeds to beneficiaries.
Any day you get served with a lawsuit is not a good day for your business. You cannot ignore the lawsuit without suffering a judgment against your business, and you know that defending the lawsuit will involve an uncertain amount of time and money. However, by taking immediate action and an active role in the defense, you increase your chances of achieving your best possible resolution of the lawsuit.
A general partnership is a popular legal structure for businesses that offer services rather than physical products. A written, or even oral, agreement between the partners can serve to create and manage the partnership without a lot of regulatory interference. One of the main drawbacks of a general partnership is the inability of the partners to sell limited ownership interests in the business to raise money, like a corporation sells shares of stock. By comparison, the limited partnership business structure allows a general partnership to raise money from outside investors without giving up management control.
The corporation is one of the more complex legal structures for a business, but it also offers the most stability. If you have dreams of turning your small business into a national or international company, incorporating is typically the right move. Corporations have been around for hundreds of years, and the law involving them is well-settled. One of the most important aspects of the law that involves corporations is the tax code. The U.S. Internal Revenue Code, or IRC, creates two categories of corporations: C corporations and S corporations.