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Six Legal Tips to Consider When Starting Your New Business

Starting a new business can be an exciting and overwhelming process. With so much to consider, it’s essential to ensure you adhere to all the legalities in starting a new business. In this article, we’ll provide six tips to help you navigate the legal requirements when starting a business.

1. Research State Requirements

The first step is to determine whether you will be conducting business in the state you live in or another state. Then, visit that state’s Secretary of State website. This website will provide you with a list of requirements to start a business and help you make informed decisions. You can also speak with a business attorney or accountant for additional support and information specific to your business.

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2. Know the Requirements for LLCs in Your State

If you are considering forming an LLC in your state, knowing the requirements to get started on the right foot is crucial. For example, in Illinois, you can find the LLC requirements in the Illinois Liability Company Act, at the Illinois Secretary of State website or by consulting your business attorney. One essential requirement is filing the Articles of Organization and officially establishing your LLC. Another important consideration is choosing a “registered agent” responsible for accepting legal services for your LLC.

Illinois offers a  booklet that provides detailed guidelines for filing the Articles of Organization, information on filing fees, other government agencies you must contact, and legal obligations you will assume after the organization is established.

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3. Understand the Similarities and Differences Between LLCs and Corporations

LLCs and corporations offer limited liability protection and require observing formalities, such as keeping business assets separate from personal assets, making annual report filings, maintaining organizational documents, and paying fees to the state to maintain the entity. However, they have some fundamental differences, and understanding them is essential to make an informed decision on how to structure your business.

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4. Decide Whether an LLC or Corporation is Better for Your Business

When choosing between an LLC or a corporation, consider business-specific goals. LLCs may be a better choice if you are a small business owner and want more control over management. At the same time, corporations may be a better option if you are looking to attract investors or plan on taking your company public.

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5. Determine Whether Delaware is the Best Option for Your Business

Delaware is popular for many businesses due to its favorable corporate laws, efficient online filing system, and investor privacy. However, there may be better fits for some businesses, especially small ones. Consulting with your accountant or a business lawyer can help you navigate solutions and set you up for the best opportunities.

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6. Avoid Relying Solely on Search Engines like Google for Legal Advice and Business Guidance

While search engines like Google can be a good starting point for gathering general information, they do not substitute professional guidance from a business attorney or accountant. Online legal services can also be helpful, but a business attorney will better understand the legal nuances of your business needs.

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In conclusion, starting a business can be a challenging but rewarding journey. Following these tips and seeking professional guidance can set your business up for success and minimize legal risks. Remember, investing time and resources into the legal aspects of your business can help you avoid headaches and protect your interests in the long run.

Seeking professional guidance can ensure your business has a solid foundation and help you avoid legal issues. I’m here to help.

Please get in touch with Mary Miles, or watch Mary’s videos for more insights.
Lawrence Kamin maintains this website to provide general information about its services and legal expertise. While we try to keep the information timely and accurate, we make no guarantees. We make every effort to correct errors brought to our attention. Full Disclaimer
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