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1. Limit your personal liability.
You can limit your personal liability by choosing a business structure such as S-Corporation or Limited Liability Company. The business structures vary in terms of tax implications and management structures; the one that is best for you depends upon your individual company’s goals and needs.
2. Get appropriate business licenses.
Check with your local city and county governments to see whether a license is required for your business.
3. Correctly classify your workers.
Whether your workers are employees or qualify as independent contractors is a critical decision that if not made correctly may result in penalties and back payroll taxes.
4. Obtain Workers Compensation Insurance.
For your employees, ensure that you have workers compensation insurance to avoid potentially business-ending liability.
5. Evaluate your Intellectual Property.
Your intellectual property (ie, copyrights, trademarks, and patents) is a valuable asset. Identify it, value it, and protect it.
6. Avoid Discrimination Claims.
There are a variety of protections for employees including the right against discrimination in the work place. This includes discrimination or harassment by your customers. Create a policy against harassment and discrimination, teach your employees about it, and enforce it!
7. Avoid Disability Claims.
Physically and mentally disabled workers are protected against discrimination and may even be entitled to active assistance by way of a reasonable accommodation. What constitutes a reasonable accommodation is varied and depends upon the facts of a particular situation.
8. Family and Medical Leave Laws.
If a worker or his or her family member becomes ill, they may have a right to take medical leave and have their position held for them for a period of time.
9. Contracts with Customers and Vendors.
Use contracts with your vendors, customers, and even employees where appropriate. A well-structured contract will cover each party’s obligations, the term of the relationship, and the available remedies for either party when the other breaks the contract.
10. When raising money – Watch out for securities violations.
Beware of the potential securities regulations that can come to play when you use other people’s money to run your business. If you run afoul of the securities regulations you risk not only civil liability, but criminal as well. |