As a small business owner, you may already be involved in a lawsuit or just considering getting help with a legal issue and have questions about working with a lawyer. Small business owners work with attorneys for any number of reasons, including the purchase or lease of property, the establishment of a legal structure, compliance with labor and employment laws, tax preparation, and other matters vital to a well-functioning business. Below you will find information on choosing, meeting with, and hiring a business or commercial lawyer.
When Do I Need a Business Lawyer for My Small Business?
Small businesses need to use attorney assistance strategically. Attorney hourly rates can add up quickly and having a basic understanding which of the kinds of legal issues you can handle alone and which generally require the assistance of an attorney. These and other issues are discussed in greater depth in the links below.
Assuming that your situation does not have any complicating aspects a business owner can typically handle the following issues without the assistance of an attorney: writing a business plan; researching and picking a name for your business; reserving a domain name for your website; creating a legal partnership agreement, LLC agreement, or shareholder's agreement; applying for an employer identification number; applying for basic licenses and permits, interviewing and hiring employees; submitting normal IRS forms; documenting company meetings; hiring independent contractors and contracting with vendors; creating contracts for use with customers; creating a buy-sell agreement with partners; updating partnership agreements; and handling correspondence audits from the IRS. Of course, any of these situations may involve complicating elements that necessitate the involvement of an attorney.
On the other hand, some kinds of situations are such that it is virtually always wise to involve an attorney. Some examples include: former, current, or prospective employees suing for discrimination or a hostile work environment; local, state, or federal government entities filing complaints or investigating you for violation of laws; you want to make a "special allocation" of profits and losses or want to contribute appreciated property to the partnership; an environmental issue arises and your business is involved; or negotiating the sale of your company or the acquisition of another company or its assets.
10 Reasons to See a Tax Attorney for Help
An attorney's involvement in tax matters can provide a range of benefits. Audits can be expensive and stressful. Consulting a tax attorney can be critical to understanding what the IRS and state tax boards require. There are ten key reasons why involving an attorney in tax matters may assist:
Time - An attorney can help you understand your responsibilities in a timely fashion, ensuring you have the information you need in time to take the appropriate action.
Immediacy - An attorney can help you understand your ongoing recording and reporting responsibilities before issues arise.
Tax Year - An attorney can help you understand the appropriate tax year and insure that you meet your tax obligation within the business's tax year.
Business Income - An attorney can help you understand what qualifies as business income for IRS purposes and report accurately.
State Taxes - An attorney can make you aware of state specific tax obligations.
Employee Taxes - Even if you have no employees you may be required to make advance payment on self-employment taxes. An attorney can help you keep up with your obligations and avoid overpayments.
Business Form Selection - Different business forms have different advantages and obligations. An attorney can help identify the right form.
Business Deductions - Deductions may be difficult to identify or understand. An attorney can help.
Changing Tax Laws - An attorney can keep you appraised and compliant with the changing tax codes.
Ignorance is not a Defense - An attorney can help you meet your obligations.
