However, simple mistakes can trip up even the most savvy business owner and risk the future of the business. Here are four legal mistakes that could spell big trouble for your business:
1. Mixing business with personal finances.
Businesses that start as sole proprietorships can often be the victim of their own success if, as they grow, they are not protected by reforming as a legal entity like a limited liability company (LLC) or corporation. Many small business owners opt for an LLC since it provides them with personal liability protection but does not carry the many formal legal requirements of a corporation. If you have started operating a business as a sole proprietor, then you should talk to a Florida business attorney about which entity makes the most sense for your business.
2. Not having any employment agreements.
Whether your business relies on contract employees of full-time paid employees, you need formal written agreements to govern the business relationship between you and the people that work for you, even if they are family members.
3. Not getting the proper business licenses.
Business license requirements are often overlooked by small business owners. You should know what licenses are required for you to legally operate your business. A business attorney can assist you with setting up the proper licenses for your business to avoid potential fines and disruption to your business.
4. Not having a succession plan.
A business succession plan is beneficial for most companies and can become absolutely essential to protect the business from the owners’ death, disability, divorce and other common occurrences. If you want your business to go on after you go, then a business succession plan is a must.