Guide to Legal Essentials for a Small Business

Hire a lawyer

While you can try to handle all the legal mumbo-jumbo yourself, it's easy to overlook something that a more experienced eye will notice instantly.

I recommend: Search the American Bar Association online lawyer directory or Lawyers.com to find an attorney or visit LegalMatch if you need someone immediately. Make sure that the individual has experience with the legal needs of small businesses before hiring.

Choose a business structure

Operating as a sole proprietorship, a partnership, a limited liability company, or a corporation will affect your tax rate and how easy it is to start and stop your business, to borrow money, to avoid losing personal assets if you're sued, and much more.

I recommend: Learn the basics of how business structures differ, then investigate which one will work best for your particular situation. Should you decide to forego an attorney and file an LLC or incorporate on your own, check out bizfilings.com.

Take a name

If you're a sole proprietor, you'll need to register a fictitious business name, also known as a DBA ("doing business as") unless you use your name as the name of your business.

I recommend: Complete and file your DBA statement online at LegalZoom.

Get licensed

Not every business owner needs a license to set up shop, but woe to you if you do need a license and are caught operating without one.

I recommend: The Council on Licensure, Enforcement, and Regulation (CLEAR) maintains an online database of professional organizations that provide licenses to businesses such as contracting, dentistry, and acupuncture.

Protect your intellectual property

If you create something new that becomes successful, you can be sure that others will copy your work and try to beat you in the market. You can make it more difficult for knock-off products to appear by protecting your creations.

I recommend: Copyright literary or artistic works that you sell, patent new business techniques or products, and trademark your business name and slogans.

Prepare for employees

Unless you're running a sole proprietorship in which you do all the work with no employees, you must apply for an Employee Identification Number (EIN) for tax purposes.

I recommend: Here's one time the IRS makes it easy for you, allowing you to file Form SS-4 online.