New Business Owners Stumble Through Paperwork

New Business Owners Stumble Through Paperwork

BusinessStarting a new business is an exciting time, but that excitement can turn to horror quickly for business owners who fail to file the proper paperwork. Every business, from a part-time operation out of a person’s garage to a multi-national corporation must file a series of documents with the state and federal government to achieve legal status to operate. With the assistance of a commercial attorney, new business owners can navigate the treacherous waters of business creation and protect their investment.

Business owners commonly make mistakes filing:

Ownership Documents

Most small business owners will structure their business as a sole proprietorship or a general partnership with one or two other owners. In that case, all owners must register with the local county clerk and file under the Assumed Name Act. The application may be done online.

For more complicated ownership situations, a commercial attorney will be necessary to create an LLC, “C” Corp, or “S” Corp. All three bring inherent tax and liability issues, and require registration with the IRS. Corporate status is not right for every business, and a commercial attorney can demonstrate the benefits and disadvantages of adopting acorporate structure.

Registration

Once the business name is registered, the business owner must register with the proper tax authorities. At the federal level, the IRS requires businesses to obtain an Employer Identification Number (EIN) for employment and excise taxes.

In addition, the business owner will need to register with the Illinois Department of Revenue to pay state business taxes. A commercial attorney can help determine whether or not the business must pay additional local taxes or seek licenses. In most cities in Illinois, the business owner will need to keep a Certificate of Occupancy on file in order to initiate utility services or schedule inspections at a commercial site.

Posters

State and federal workplace and safety regulations require business owners to post information in a place that is accessible and easy for employees to see. Without the correctposters, the business owner faces additional liability and penalties in the event of an employee lawsuit. The posters come in pre-packaged sets and are available several places online.

Nothing derails a new business faster than a federal fine for missing business registration or paperwork. A commercial attorney is a valuable resource when completing new business paperwork and covering liability.

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