Starting a business is an important milestone that must be carefully considered and requires a lot of courage. Business Law Attorneys In Westchester County, NY can help you protect your interests. Seeing your ideas brought to life can be incredibly rewarding. However, achieving success requires laying a solid foundation of lots of hard work and careful decision-making while your business is in its infancy still.
We here at Rosenbaum & Taylor, we assist businesses with making strategic decisions from the very beginning. Our dedicated business lawyers in New York assist both startups and established entrepreneurs all across the Westchester area. We strongly believe that innovation is crucial to a thriving economy, and therefore we make an investment in a hands-on approach to assist and ensure that local businesses are successful.
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What is a Business Attorney?
They are legal experts who help to guide businesses through numerous federal and state laws that affect their businesses. Business attorneys assist with all issues involved with an entity (including forming a corporate or another type of entity, selling additional shares, corporate maintenance, dissolution, and stock option plans) contracts (negotiation, drafting, and review), disputes with various third parties, as well as other issues affecting your business, including regulatory compliance, protecting intellectual property, and employment issues.
We can make sure you understand every step involved in the business formation process, by providing you with the necessary professional analysis needed to make an educated and informed decision on such issues as:
- Selecting the right business entity that best suits your governance structure, goals, and industry
- Establish corporate formalities like meeting minutes and bylaws
- Acquiring assets and obtaining financing
- Structuring business transactions
- Pursuing franchising opportunities
- Addressing tax implications
- Establishing a business succession plan
- Determining shareholders’ or members’ rights
Making sure that your business has the right foundation can mean the difference between succeeding or failing. The Westchester business lawyers at Rosenbaum & Taylor have assisted numerous New Yorkers with starting their businesses and head them on the path towards success. Whatever industry you are involved in, our lawyers can help ensure you are solid ground.
After we assist you with getting your business started, we also can help you address the numerous business law issues that you might be faced with. After we have helped you get your entity set up, our attorneys can continue working with you as your ongoing general counsel to ensure that your interests are protected at all times.
Whenever a new business is formed, you must determine what kind of entity you want your business to be – and each of them have their own series of pros and cons. In order to determine the right entity for you, the following are the most common forms of entities that are available.
Limited Liability Company (LLC)
A limited liability company does exactly that – it limits your liability. With an LLC, the assets and debts of your business are separate from all of your personal assets and finances, and the business assets are exempt from the owners’ creditors. Also, LLC’s allow ownership by entities and nonresident, unlike Subchapter S corporations. They also allow profits and losses to be creatively allocated among the owners who put up cash and those who put sweat equity.
It was commonly thought many years ago that running a business as an LLC worked to inhibit growth by not being able to attract investors. However, as the Adair Rosenbaum & Taylor corporate lawyers have learned through their many years of experience, it actually is easier attracting equity to an LLC rather than a corporation due to how options are internally allocated and the easier procedures that are in place for perfecting the security interests of the owners.
C Corporations, like LLCs, limit liability to officers, directors, employees, and shareholders. The main drawback is the possible double taxation. However, sometimes, it is advisable for a C corporation to have foreign ownership. But do point out, whether taxed as an S corporation or C corporation is a corporation still while LLCs have the option of being taxed as a corporation as well.
An S corporation is similar in many ways to a C corporation. They offer investment opportunities and limit liability. However, an S corporation is not subjected to double taxation the way a C corporation is. S corporation owners report their profit and loss shares on their own personal income tax returns which means this income is taxed just once. However, there are several limitations that are faced by S corporations.
First of all, only entities that are wholly owned by permanent residents or legal U.S. citizens are able to file for the S corporation status. Also, S corporations can only have a maximum of 100 shareholders. There also can be higher IRS scrutiny faced by S corporations and they will have ongoing costs to maintain their S corporation status. Another thing about S corporations is they should not make real estate investments.
It is very easy to form and run a partnership. That makes them quite popular among small businesses, however, there are some downsides as well. Partners are still personally liable for the company’s debts and liabilities, including those that another partner has incurred. Unfortunately, a majority of partners never sign a partnership agreement. If something ends up going wrong, then there can be massive expenses in ending the business. Before you rush into a partnership, consider how your business could be impacted by future liabilities.
Sole proprietorships, like partnerships, are also very easy to form and run and state filings are not required (although you are required to file a county dba for the assumed name for your business). However, the owner still will be liable for any debts or lawsuits against the company.
So if you are starting a business on your own, you may choose a sole proprietorship since it is not as expensive compared to other entities. However, in the future, it can leave you very vulnerable to more expensive situations.
What Kind of Business Entity is Best for Me to Form?
There are numerous corporate forms that are available under the law in Westchester, New York, including limited liability companies, partnerships, and corporations. In general, the major advantage that a corporation has that its officers are protected against personal liability for those debts that the corporation incurs. However, corporate officers may be subjected to double taxation with both personal income taxes and corporate taxes reducing their personal profits.
A more advantageous and simplified tax structure is offered by partnerships, but having potential personal exposure from a business. A limited liability company may be seen as a hybrid of these two, which offers the tax advantages that a partnership provides along with a corporation’s liability protection.
There are other important considerations in determining how to incorporate a business, including issues of control and management, financing, governance, and business succession. Review all of the options that are available to you with an experienced corporate attorney to ensure that you select an entity structure that meets all of your company’s goals and needs.
How can Business Disputes be Avoided?
A majority of business disputes are about a difference of opinion about the application or interpretation of a contract that is between the two parties, formally known as contract disputes. Carefully drafting concise and clear contracts, to begin with, is the way that these disputes can be prevented from arising.
The contract also must be written in such a way that protect the parties in case a dispute does occur, like ensuring that there is no waiver of important rights or that disadvantageous dispute resolution means are not written into a contract. In order to cover all of those bases sufficiently requires negotiation skills and thorough attention to detail when documents are being drafted or reviewed.
How Can The Intellectual Property Of My Company Be Protected?
The intellectual property of your company can be protected in several different ways. First of all, you might need to apply for a copyright, trademark, patent, or trade secret. If you are planning on selling overseas or developing products oversea, make sure to also pursue foreign registration. You also may need to use other strategies in order to keep your intellectual property protected.
For example, Non-Disclosure Agreements (NDAs) might need to be used with suppliers, contractors, employers, and other parties. Speak to an experienced business transaction lawyer today.
Which Is The Best Organizational Structure For My Business?
Five major points need to be considered when selecting the organizational structure to use for your business, in addition to other considerations unique to you. Here are the five major points you need to consider:
- Your Company’s Management Structure
- If you are planning on issuing and trading stock
- Capitalization of your Business
- Tax Preferences
Tax and liability preferences are the major reason why people select corporations or LLCs over sole proprietorships. A corporate or business law lawyer can help you select which organizational structure will best suit your business.
What Is The Main Difference Between A Patent, Trademark, Or Copyright?
All of those devices help to protect your intellectual property. However, all three of them do serve quite different purposes. Copyrights provide protection for “original works of authorship.” In other words, a form of expression.
The copyright, however, does not protect such subject matter the way a patent or trademark would. Copyrights, for example, would protect a description or picture of an ice cream cone, but it wouldn’t prohibit other people from creating a similar ice cream cone.
Trademarks protect logos, phrases, and words that are used by companies on their goods to differentiate the source of their goods from other businesses. That prevents other companies from being able to use a similar logo, phrase, or word when selling their products.
So if a penguin is used by your company for advertising your ice cream cones, then a trademark could prevent a penguin from being used by other companies for marketing their ice cream cones. But a trademark wouldn’t prevent other companies from being able to sell their ice cream cones.
Patents are grants of property rights and protection to an inventor that the Patent and Trademark Office issues. Typically, a patent lasts for 20 years starting on the date that the patent application is filed. As an example, a patent could protect others from creating your special ice cream cone. Only you could make it unless you ended up selling your patent rights to a different entity.
What Types of Registrations, Licenses, And Permits Does My Business Need?
The types of registrations, licenses, and permits that you will need to operate your company will depend on the type of business you have. The following are various examples of the different kinds of documents that you might need to run your business:
- Employer Identification Number (EIN)
- Health Department Permits
- Sellers Permit
- Zoning Permits
- Sales Tax License
How Can a Corporation be Dissolved?
In order to dissolve a corporation voluntarily, the first thing you will need to have is the vote of 50% or more of the voting shares. That either can be done through written consent or a noticed meeting. The notice needs to also be given to all creditors (and potential creditors) of your pending dissolution.
After the business has been wrapped are, all assets have been distributed, and all debts have been provided for, a Certificate of Dissolution will need to be filed by the corporation with the Secretary of State. If not all shareholders voted for initiating a voluntary dissolution then a Certificate of Election to Dissolve will be required as well.
Contact Rosenbaum Taylor to Speak to Our Business Law Attorneys Today
If you have interests that need to be protected, our lawyers at Rosenbaum & Taylor can help you access the damage and seek the justice you deserve. We are customer service oriented and expert in business law. Schedule a consultation and free case review today!