Starting a new business is an exciting, and often intimidating, experience. In addition to choosing a business entity or structure, it is also important to establish the proper legal foundation that will protect you from personal liability. Consulting with knowledgeable Tennessee business formation attorneys for proper guidance can help mitigate costly and damaging consequences.
With over 40 years of combined legal experience, our attorneys at McCarter | East PLLC can walk you through the process and determine what best suits your needs. Also, we can explore your legal options and decide how to protect you and your business partners from potential liabilities or debts. Contact our legal offices today to get the legal guidance and advocacy you need when starting a business. We proudly serve clients throughout Murfreesboro and Berry Hill, Tennessee.
Business Formation Tasks We Can Assist You With
The decisions made in the early stages of business formation can affect other crucial aspects of the organization, including liability, taxation, business succession, management, ownership transfer, and dissolution. Our successful team of attorneys at McCarter | East PLLC is fully prepared to provide comprehensive guidance and assistance on a wide range of business formation tasks, including those discussed below.
Choosing an Entity Type
One of the first tasks of business ownership is choosing a business entity. Some of the most common types of business entity options include:
Limited Liability Companies (LLC): Limited liability is the most common entity used by small businesses. LLC provides corporate protection to its members by limiting personal accountability for company debts and liabilities.
Sole Proprietorship: A sole proprietorship is the most basic business organization. The sole proprietor (or owner) has total control over the business, pays taxes, and receives all profits. However, the sole proprietor's business and personal assets are exposed to liability.
Partnership: A partnership is an association of two or more individuals that serve as co-owners of a business with the aim of making profits. Partners will be held liable for debts, liabilities, and actions of the partnership.
Corporations: A corporation is a legal entity. Corporations provide adequate protection to directors, officers, and shareholders. Only the corporation will be held responsible for corporate debts, liabilities, or negligence. However, they have stringent tax requirements and higher administrative costs.
Establishing Employment Contracts
Another important task of any new business is establishing employment contracts that vary depending on the type of service you provide. Contracts and how they are worded are often the main point of contention in lawsuits so knowing which contracts will best protect the interests of your business is crucial. Common contracts include:
Having contracts reviewed by legal counsel helps avoid unnecessary disputes, reduces time and expense, limits liability, manages risk, and prevents unintended legal consequences.
Filing Required Taxes
All businesses are required to file taxes but knowing which requirements pertain to your business can be challenging. The business structure you choose will determine which taxes you will need to pay and how they must be paid. Required taxes may include:
Sales and use tax
Hiring experienced legal counsel can help you identify which federal, state, and local taxes apply to your organization.
Applying for Licenses and Permits
Depending on your industry, your business will need to obtain applicable licenses and permits from both state and federal agencies to operate legally. Such business activities that require Federal licensing and permits include:
Firearms, ammunition, and explosives
Fish and wildlife
Mining and drilling
Radio and television broadcasting
Transportation and logistics
However, the processes involved in applying for these licenses and permits can be cumbersome and overwhelming. An experienced attorney can assist you with applying for your federal, state, and municipal licensing and permits, including maintenance and renewals.
Our attorneys will work with you to understand your business needs and goals. We will advise you on your business entity options and help you make informed decisions going forward. As your legal counsel, we will help set you up for success. Call McCarter | East PLLC today to speak with our team of knowledgeable Tennessee business formation attorneys.