Protecting Your Home Business From Litigation
When a business is sued, a number of factors come into play. This can include money, time, reputation and stress. Lawsuits can also end with one party paying damages and/or court fees. So, is a home business also at risk?
Currently, the Small Business Administration (SBA) notes that there are nearly thirty million small businesses operating within the country. Most of them are home-based, equating to nearly 50 percent of the U.S. economy. But, with the ever-troublesome woes of life that follow, how can these businesses protect themselves?
Always Maintain a Positive Reputation.
As a business owner, you have a reputation to uphold. Applying integrity to all of your dealings with employees, customers, competitors and the community will help maintain your credibility. If you make a promise or a commitment, keep it.
Bending the rules or misrepresenting your business, products or capabilities could come back to haunt you in the form of general mistrust, lost business and potential lawsuits. Be honest in your dealings and the long-term trust you establish with your customers will be a major asset to your business.
Document Agreements in Writing.
You can save time and money by having an attorney draft formal contracts, such as employment contracts and general sales and supplier agreements. But it’s also important to document informal agreements with customers or suppliers. For example, if a customer promises to pay you for a product within 30 days of delivery, he or she should sign a promissory note. Signed agreements and good record keeping can help you resolve disputes, avoid confusion about rights and duties, and protect your home business from lawsuits.
Check With Your Local Government For Required Special Licensing Or Insurance.
For most states, a home-based business must have a business license. Check with state or local entities that control your type of business to determine what you need. Also, checking local zoning laws will help ensure that your home is legally set up to house a business.
Even if a license or zoning law is not required, registering with the state and collecting sales tax will enable you to properly represent your business.
You Must Pay Taxes; Protect Your Home Business From Fraud Investigations.
When you become a home-based business owner, it is important to be aware of your tax obligations. You have a responsibility to provide accurate and detailed information to government tax entities, so it is important to speak with a lawyer and an accountant before engaging in home-business practices. There is no defense for not knowing the law, so be safe, we advise to speak to an attorney and an accountant.
A Lawyer With Experience Can Take Care Of Your Legal Needs.
In business, legal issues can arise when you least expect them. To help you avoid costly lawsuits and unnecessary legal problems, consult with a lawyer who has experience working with businesses similar in size to yours. You might also consider a consulting arrangement that allows you to do the legwork but provides the lawyer with an opportunity to review your work and give helpful feedback. We at Thompson Law would be more than happy to assist you with your home business needs. Contact us today to schedule a consultation.