With the United States economy performing better than it has in years, 2019 is a great time to start a business in Ohio. But even during the best of times, starting a business is complicated. In addition to the numerous financial challenges of entrepreneurship, there are a multitude of legal issues to consider when forming a company. Legal planning during the early stages of a business can help to avoid unnecessary risk and complications down the road.
From the firm’s beginning, Graham & Graham has had the privilege of helping businesses, both large and small, reach their potential and find success. We’re not only business lawyers—we’re also business owners. We understand the difficulties company owners face and are there beside you when you start a business, expand your company, increase your revenue, or encounter problems.
Choosing a Business Structure
Your business can be structured as a sole proprietorship, partnership, limited partnership, C-corporation, S-corporation, or limited liability company. Each structure has benefits and drawbacks. Which one is best for you depends on factors such as the type of business you will be running, your appetite for risk, tax structure, and cost implications. Graham & Graham’s experienced business attorneys can go over the pros and cons of each structure with you and help determine which is the best fit for your business.
Registration, Licenses, and Permits
The State of Ohio requires all businesses to register with the Ohio Secretary of State’s office based on the legal organization of the business. Businesses may also need to acquire licenses and permits from different state agencies, such as the Ohio Department of Taxation. You can find out which licensing and permitting is required for your company at the business section of Ohio.gov. Some required licenses are issued locally by the city where the business will operate.
Business Partner Agreements
If you’re starting a company with business partners or co-founders, you should have a formal written agreement between the parties. Despite the best of intentions and initial optimism, disagreements can arise between business partners. A contract that states how disputes will be resolved can protect your interests and avoid prolonged—and expensive—litigation. Also, preparing an exit strategy for partners is highly recommended.
Hiring help for your business poses a series of legal issues. For starters, you’ll need to decide whether to hire them as employees or independent contractors. Hiring employees makes you responsible for workers’ compensation, certain taxes, unemployment compensation, and other benefits, while using independent contractors does not. Misclassification can get you in trouble with state and federal authorities, so choose wisely and know your responsibilities. Other things to keep in mind if you’re hiring help include creating an employee handbook, non-disclosure agreements (if there’s information you don’t want your workers to share), and protection of personal information.
For many companies, intellectual property is more valuable than their physical assets. Intellectual property can be protected through trademarks, patents, copyrights, or trade secrets. Copyright, patent, and trademark protection must be applied for with the U.S. government, while trade secrets lack the formal protection of government registration. Non-disclosure and confidentiality agreements are also part of protecting intellectual property, as are non-compete agreements if your employees are involved in selling your product or service.
Zoning and Environmental Requirements
Zoning laws determine the types of businesses that are allowed in certain locations. The type of company you create may determine whether there are any zoning complications. Environmental requirements must also be taken into account. The Ohio Environmental Protection Agency (EPA) strictly regulates water and sewer, hazardous waste, solid and infectious waste, and air emissions. Failure to comply can result in steep fines and other costly enforcement actions. Ohio EPA’s Small Business Assistance Program helps new businesses understand environmental laws.
Like your personal assets, your business assets should be insured. Businesses may require insurance for liability, buildings, business interruption, business income, employee protection, computer equipment, burglary, and more. An attorney can make insurance recommendations for covering every aspect of your business.
Start Your Business Off Right With Help From Graham & Graham
Starting a business can be one of the most rewarding—as well as one of the most daunting—decisions you ever make. As business owners and lawyers, Graham & Graham understands the opportunities and difficulties entrepreneurs face in today’s market.
The topics covered here are only the tip of the iceberg when it comes to business formation. Beyond starting a business, we can help companies through all stages of their development, from eliminating exposure to unnecessary risk to resolving disputes to guiding you through purchases, sales, or mergers. Wherever your company is in the business lifecycle, when you need solid, experienced counsel, we invite you to contact us.