Click to download the Entity Selection Questionnaire in pdf format.

Dear Small Business Owner:

I am a local attorney and I practice in the area of small business start-ups and development. You may wonder what the services of an attorney can accomplish for you as a business person. The answer depends upon your goals and desires as a business owner.

Doing business (legally!) in Washington State is a multi-faceted and even amazingly complex ordeal. It requires registering with numerous government bodies at the local, state, and federal level; filing tax returns with certain government entities; and often withholding and paying taxes to a variety of those same government entities; registering employees with certain government entities; and obtaining various permits and licenses to carry on business.

Further, foreign (out of state) entities need to register to do business in Washington State before commencing, or rather, “transacting business” therein. The process is almost as involved as starting an entity anew.

For sole proprietors and partners, different legal entities offer certain protections that may enhance your ability to avoid crippling lawsuits and litigation. Additionally, tax advantages are available to certain entities. For example, business owners should consider incorporating. Certain entities help ease the bite of payroll taxes, a tremendous burden for many small business owners.

For existing corporations, contracts and other instruments can help secure payment for goods sold on credit, or installment plans. Careful drafting can avoid many traps and pitfalls inherent in such sales.

Some businesses may need to be bonded. Further, one may require additional licenses to carry on one’s profession.

For businesses looking to expand, employees may be necessary. However, employment laws are complex. The question of independent contractor vs. employees is a perplexing one. One should consider the advantages of employment contracts, as well as independent contractor agreements.

For businesses with multiple owners, issues may arise when a stock holder dies, or becomes incapacitated. The other owners may not realize the deceased’s shares could fall into the hands of third parties. Existing owners may not wish to operate with these potential new parties. Certain shareholder agreements and insurance policies may avoid this situation.

Financing a business is costly. However, numerous tools are available to provide your business with proper capital. Banks are an excellent source to provide loans for your business. Unfortunately, many banks will not loan money to new businesses without a proven track record. Thus, alternative financing should be considered. The Small Business Administration (SBA) may back loans to small businesses owners. Such can help the small business owner obtain loans from banks that would otherwise be unavailable. Securing such financing often involves writing a complex business plan. An attorney can help you draft such a plan.

For business owners looking to retire or change fields, selling your business may be an option. One should consult an attorney when selling a business. Indeed, numerous steps need be taken when selling a business. Further, tax implications arise in most business sales. A business owner should, at least, have selling documents reviewed by a corporate lawyer.

A lawyer can provide only so much to a small business owner. Other professionals should be utilized in tailoring a business plan. However, a corporate attorney can be invaluable in securing peace of mind for the small business owner.

Very truly yours,

Nathan L. McAllister, Attorney at Law