As a small business owner, you create a legal business and handle almost every aspect of the business. You may be the accountant, customer service rep and lead designer combined. When it comes to serious legal issues, what you shouldn't be is your own lawyer.
1. Special Allocations
A tax lawyer may be called for if the partners of an LLC decide to split profits in a way that does not correspond to the interest percentage owned by each partner. The IRS prevents LLC businesses and partnerships from structuring profit and loss allocation in such a way that allows the company to pay the least amount in taxes. Because the IRS is particularly wary of special allocations, it is wise to hire an experienced tax lawyer in this situation.
2. Appreciated Property Contributions
The advantage of contributing appreciated property, such as stock or real estate, to your partnership or LLC, is that it can create a significant tax savings for your business. In order not to get into trouble with the IRS, hire a tax lawyer with extensive knowledge of the business tax code.
3. Environmental Issues
If you are planning to purchase a business and discover a major environmental issue, contact your lawyer before moving forward with the purchase. Your lawyer can plan the necessary steps to keep the responsibility for contamination and the accompanying penalties from transferring to you.
4. Employee Lawsuits
If you have employees, you will need to consult with a lawyer if a lawsuit is threatened or filed against you by a current or former employee. Common lawsuits filed by employees range from sexual harassment to discrimination to unfair firing. An employee-filed lawsuit definitely requires the counsel of an attorney experienced in this area of business law.
5. Customer Lawsuits
Being a business owner carries with it the responsibility of due diligence between your business and your customers. The sales contract is really a contract of trust that you believe your product to be both safe and beneficial. If a customer claims to have been hurt by your product or service, and files or threatens to file a lawsuit, you should talk it over with a lawyer who specializes in this type of business law.
6. An IRS Audit
A business tax audit can be a terrifying experience. A tax lawyer with audit experience can prepare you for the audit process by helping you organize your materials, and in terms of the potential stress reduction it provides, makes it a good use of resources.
Because your business is important to you, be aware of common legal issues, like taxes and lawsuits, that require the advice and services of a lawyer. Keep in mind that making a mistake in these areas can cost your business significantly more money in the long term than the legal services of an experienced lawyer.