Running a business always entails a certain level of risk. Any good business owner knows that it is important to understand those risks and take the necessary steps to minimize them, in order to succeed and endure. While there are many types of risk that a business may face, legal risks are arguably among the most impactful, and most often overlooked. The following six legal risks are surprisingly common and, if not handled properly, can lead to excessive costs or penalties and lost opportunities.
Regulatory Risks
Virtually every business is subject some type of government regulation. Whether it is a major part of a company, or just something that can be handled easily, government regulations can never be ignored. Addressing these issues up front before they become problematical and coming up with a plan on how to ensure your business is always in compliance is a great way to avoid complications in this area.
Employee Risks
Having employees is important for most types of businesses, but it also exposes you to many kinds of risk. Employment law is quite complex and constantly changing, which can leave a lot of businesses exposed to lawsuits and other problems. Proactively dealing with these issues can help you avoid legal issues related to your employees.
Tax Risks
Taxes are one of the biggest expenses that you’re going to have as a business. Not only do you have to manage the taxes of the business itself, but you’re responsible for ensuring the payroll taxes are taken care of, and much more. If mistakes are made, the IRS and State taxing authorities can come in and cause huge difficulties. They can even lead to the shutdown of your business.. Working with an accountant to avoid these issues and having an attorney to help through existing problems can protect you from tax-related risks.
Legal Structure Risks
When starting a business, choosing the legal structure is a big decision. You can operate as a sole proprietor, a partnership, an LLC, an S-Corp, a C-Corp, or another type of entity. The type of legal structure you choose will impact your taxes, personal liabilities, and much more. Discussing your options with a skilled advisor is a great first step towards ensuring you choose the right structure for your situation.
Contract Risks
Contracts are an important part of most businesses. Whether it is a contract with a customer, an employee, a vendor, or anyone else, having a properly written and signed contract is important. When handled correctly, contracts can be a valuable asset to your business. When mishandled, however, they can present huge risks or unanticipated costs.
Personal Injury Lawsuit Risks
Any company that has people coming onto their property is at risk for a personal injury lawsuit. Sometimes these lawsuits are from scam artists trying to take advantage of a situation, and some are from people who have suffered a legitimate injury. Having an attorney available to represent your business will help to minimize the risk and allow you to remain focused on your business.
Contact Us to Reduce Your Business Risk
The best way to reduce risk is to be prepared for whatever might come your way. Don’t wait for a problem to arrive. It’s best to be proactive. Contact the Law Office of Philip P. Crowley LLC to discuss what we can do to help minimize the risks facing your business.
