Starting your own business can be a major decision to make, and it can be common for some individuals to make oversights or other mistakes that can compromise the chances of their success. In particular, starting a business can expose you to a number of legal risks. To help manage these risks, you should consider incorporating your enterprise. If you have a limited understanding about incorporating, you might be under the assumption that some myths are true, which can cloud your judgment during the formative stages of your company.
Myth: Only Large Businesses Need To Incorporate
There is a particularly common notion that it is not necessary for a small business to incorporate. However, if you have not incorporated your enterprise, you may be personally liable for any legal issues that arise. Whether it is a faulty product or the actions of one of your employees, it can be easy to find yourself in a legal dispute where your personal assets are at risk. Considering that a single lawsuit could both ruin your business and deprive you of your own assets, this is a risk that must be avoided. By incorporating, your business will be considered its own entity, and as a result, it will be more difficult for plaintiffs to target your own assets.
Myth: It Is Easy To Incorporate So You Do Not Need An Attorney
There are a number of online resources that can allow you to create and file the documents needed to legally form the corporation. While this may save you the fee for hiring an attorney, it can prove to be a costly mistake to make. There are a number of different classes of corporations, and each one can provide different benefits and requirements. For example, an LLC may be a suitable option for a small firm with only a handful of partners, but it may not be sufficient for a company that has a large number of investors. By hiring an attorney, you can help ensure that you are receiving the advice that you need to ensure you form the correct type of corporation for your enterprise's needs.
Incorporating your business can be an essential way of minimizing your legal risk. Without this step, you may find that your personal assets and wealth are at risk of being lost in a lawsuit. Knowing that incorporating is not limited to large companies and the benefits to hiring an attorney will provide you with a better ability to make informed choices about forming a corporation for your enterprise. Contact a law firm, such as the Souders Law Group, for more information.