If you’re in the process of starting your own business, you should speak to a business lawyer Middletown, CT residents trust. One of the most common mistakes new business owners make is not taking the legal aspect of owning a business seriously. It’s important to educate yourself on the legal side of maintaining a business so that you avoid future headaches.
Common Legal Myths About Starting a Business
There are many myths out there about the legal side of having a business. Believing them could put your business at risk.
- Forming an LLC Will Protect Your Personal Assets: Many business owners choose to classify their company as a limited liability company (LLC). They may assume that with this formation, their personal assets are safe in the event of a lawsuit. Unfortunately, that isn’t necessarily true. If you run into legal trouble at some point, your personal assets may be at risk. You should communicate with your lawyer regularly about protecting your personal assets.
- You Can Write Everything Off: While you can write off certain business expenses when doing your taxes, you can’t write off everything. Before you decide to write off an item, ask yourself if you would have the expense if you weren’t in business. For instance, you can’t just write off every restaurant meal if you weren’t with clients. Be careful about what you write off to avoid an audit.
- If Your Business is Struggling, You Can Just File for Bankruptcy: It’s true that bankruptcy may be a good solution if your business is struggling with debt. However, you should understand that not every debt can be discharged in bankruptcy. For instance, if you have secured creditors, they can still go after your property if you file for bankruptcy. Additionally, if you haven’t paid your business taxes, you won’t be able to discharge that in bankruptcy.
- You Don’t Need to Hire a Business Lawyer: A common mistake many new business owners make it thinking they don’t need to hire a business lawyer in Middletown, CT. However, working with an experienced business lawyer is invaluable for your company. For example, if you want to enter into a contract with another business, you should first have your lawyer review the document to ensure it has your best interests in mind.
- You Can’t Get Sued If You Didn’t Do Anything Wrong: Unfortunately, this isn’t true. Even if you follow the rules, someone may still try to come after you with a lawsuit. That’s why it’s important to always be prepared and contact your lawyer as soon possible if there’s a possible lawsuit against you.