STARTING A SMALL BUSINESS
Starting a business can mean the fulfillment of a lifelong dream. Making decisions to chart the course of your business is just one aspect of starting a business. A strong legal foundation is also critical forming a solid foundation for growth. Our attorneys can help.
Minnesota Business Lawyers for Starting a Small Business
If you are starting a small business in Twin Cites, South of the River or anywhere in Minnesota, a small business lawyer can help. Many issues must be addressed when starting a small business. Our business lawyers can provide advice that will set your small business on sound footing to face future challenges. The firm’s business attorneys can also help by preparing contracts and agreements so that they provide predictability in good times and solid remedies when things go wrong.
Which Minnesota Business Organization is Best?
One of the first steps to opening a business is setting up the legal entity that will be conducting business. Before a business is established, our attorneys examine the best type of business organization so that the entity fits a client’s business goals.
Many businesses begin as sole proprietorships or general partnerships. These formats offer simplicity, but they provide less protection to their owners when things go wrong. This simplicity is often less desirable because it comes with disadvantages, chief among them being that a proprietor or partner is personally liable for any debts and liabilities faced by their businesses.
For this reason, most small business owners opt for more formal entities to conduct business. By organizing a formal entity, owners can still reflect business income and losses on a personal tax return. However, owners can also enjoy protections against exposing their personal wealth to creditors of the business.
Many of the business structures to consider are the following:
Limited Partnerships (“LP”): In a limited partnership, two classes of partners share in control: general partners and limited partners. The “general” partner is exposed to unlimited liability for business debts. However, the limited partners enjoy insulation from business liabilities. Limited partners have less control over the company than do general partners. These structures are occasionally best when one investor is putting significant funds but is not playing a significant management role.
Limited Liability Partnership (“LLP”): In an LLP, partners manage the company as equal partners, unlike the tiered system in play with an LP. However, the partners are usually not exposed to personal liable for any debt., under most circumstances. Many law firms and accounting firms are organized as LLPs.
Limited Liability Company (“LLC”): An LLC is a company, but it may consist of just one owner/member or more. LLCs are governed by an operating agreement that establishes agreements among the members. It also creates procedures for making future business decisions. A Minnesota business lawyer can help you form your LLC by filing the necessary documents with the Minnesota Secretary of State. However, an attorney goes beyond what many online services offer in that the attorney can provide counsel regarding many other issues that are specific to the business or industry in which the LLC will operate.
Corporation: Corporations with a small number of owners are generally referred to as “closely held corporations.” A corporation may be a C-Corporation or an S-Corporation. An S-Corporation can be a good option for starting a business because it is a pass-through entity for purposes of taxation. An attorney can provide legal advice about whether your circumstances fit best in a closely held corporation.
Our Business Services
We advise clients about choosing the right entity.
We help clients form the entity and document that step by creating a “corporate book” of company actions.
We provide advice and connections regarding capital structures.
We draft and negotiate agreements among shareholders or members, including shareholder agreements, operating agreements, partnership agreements and joint venture agreements.
We provide advice about various types of financing arrangements like venture capital, bank financing, etc.
We prepare new agreements or edit existing agreements to provide protections for the business in the appropriate industry.
We identify and recommend protection for trademarks, copyrights and other intellectual property rights.
We can provide counsel on employment matters and independent contractor arrangements.
We provide advice on compliance issues, including health care and workers compensation issues.
We provide counsel for structuring mergers, acquisitions and other transfer mechanisms and combinations that arise during the purchase, sale or consolidation of businesses.
We assist non-profit clients in obtaining initial status and maintaining tax-exempt status.
Learn More
To learn more about the business succession planning services we provide, please call us at 952-432-3136 or, if you prefer, contact us using our online form.