When starting a business, there are some important legal issues that you will have to deal with, no matter how much you would like to dive in and get started. However, if you neglect these legal steps, you will find that maintaining business in the future becomes much more difficult, and in some cases impossible. It is in your best interest to take these legal issues seriously and resolve them as soon as possible when starting a business.

1) Develop a Strategic Business Plan

This plan will be the blueprint and backdrop for your business, the building block on which all other aspects of starting your business are based. Also, having a business plan will make it much easier for you to receive financing for your new business. Very few people actually have the funds available to cover start-up costs, and a business plan is something you can present to family, banks, or other private investors to gain their confidence in your business. You must describe in detail how you plan to operate your business and exactly what this business is.

2) What type of legal entity is your business?

This will determine if you can be sued for problems that arise between the company and its customers. It’s extremely important and often neglected when starting a business, but it can actually make or break you during those crucial first few years when the business is trying to establish itself and grow. You don’t want to be left with liability issues, debt problems, or unnecessary obligations, and the type of legal entity you are will also determine the tax strategy the government applies to your business. Protect yourself from liability issues and make sure you are not personally responsible for any unfortunate occurrences.

3) Determine Capitalization

You cannot survive as a business without proper capitalization, and this will include both equity and debt issues. Capital is raised through the sale of commercial property interests, such as shares, allowing this portion of capital not to require repayment to financial backers. Before you even think about starting your business, you’ll need to have a good relationship with your bank or an established financial institution. If you don’t have adequate capital, your business will fail, no matter how comprehensive your business plan was.

4) Taxes, Taxes, Taxes

Everyone pays taxes… and so will you and your business. You will have to deal with income tax, employment tax, sales tax, and any other state taxes imposed by local governments. If your business does not pay the required taxes, you, as the owner, will be liable; therefore, you will need to develop tax plans for your business on a regular basis to ensure that you are following the most current regulations and Tax laws.