If you are a small business owner, you likely began your business as a

Incorporation can be complicated, and it is common for business owners to have questions about what this process entails. The following provides answers to some of the questions that we hear from business owners about incorporation.

When is it Time to Incorporate?

Some business owners incorporate while they are still in the startup process. One reason for this is that investors often need a startup entity to be a company into which they can place funds. Even if you are not accepting funding from investors, it can still be a wise idea to incorporate at the outset of your business. If you did not incorporate during the start-up process, it is a good idea to incorporate when business is viable.

How Much Does Incorporation Cost?

The costs associated with incorporating your business entity will depend on several factors. Some of the elements that will influence the cost include the amount that you are using as capital and the complexity of the business setup. A knowledgeable corporate lawyer can provide you with a better idea of the costs that you should anticipate.

How Long Does the Incorporation Process Take?

The time that it takes to form a corporation depends on the time of year. Standard filings often takes between four to six weeks, although it is possible to expedite the paperwork at an additional cost. After the articles of incorporation are processed, there are other steps involved that can protract the length of the incorporation process.

Why is Incorporation Helpful?

There are several advantages to the incorporation process. First, incorporation will result in the business becoming a separate legal entity with the ability to act on its own. This means that the corporation will be able to do things like file a lawsuit, open bank accounts, and sign contracts. Additionally, after a business is incorporated, its creditors are only allowed to seize business assets if there is a default on obligations. A corporation can also establish a business credit rating that is distinct from the business owner’s credit rating.

How do You Begin the Incorporation Process?

There are several things to do before filing articles of incorporation. First, you should determine who the owners of the corporation will be. You will also need a name for the corporation. You will need an address and registered agent of the corporation. Besides forming the corporation, you will also need to do things like adopt bylaws, appoint officers, issue securities, and perform several other tasks.

Speak with an Experienced Michigan Corporate Attorney

Incorporation can be difficult to navigate, but an experienced attorney can help. Contact Resnick Law PC today to schedule your free case evaluation.

Starting a viable small business is the dream of thousands of entrepreneurs around the United States. Each year hundreds of new companies launch, boosting the economy and giving individuals like you a chance to be their own boss. Unfortunately, many small business owners do not take the time to contact a business lawyer before finalizing their launch. The prevalence of websites offering low cost document preparation and the do-it-yourself attitude common among business owners lead to many making crucial mistakes. Knowing why you need to

Changing State and Federal Law

The laws regarding operating small and large businesses are constantly changing. One way to protect your business from making an error that leads to violating a law is to consult an experienced business attorney. Laws surrounding business incorporation, hiring, and paying taxes are all complex and can result in high fees if violated. Instead of hoping that you have enough knowledge to side-step most issues, talk to an expert who can provide you with the peace of mind you will need to operate your business smoothly and legally.

Prevention

Many small business owners do not consult attorneys until after a disaster has happened.  However, once a former client or vendor has initiated a lawsuit it might already be too late to benefit from the help of an attorney. Consulting a business attorney during the launch stage of your business allows you to benefit from early preventative measures. An attorney can work with you to establish a plan that provides you protection from common lawsuits and issues that could ruin or bankrupt your company. Remember, one ounce of prevention can go a long way.

Extensive Legal Protection

As previously mentioned, contacting a lawyer only after a legal problem has occurred can limit an attorney’s ability to help you. In addition to providing basic preventative advice that will help you operate your business legally and efficiently, an attorney can provide you with extensive legal protection. Business owners must deal with legal disputes with customers, vendors, employees, and other business owners. Having an attorney who has worked with your business since start-up means you have someone on your side who understands every aspect of your business, making him or her able to provide you legal protection in a variety of situations.

Contact Resnick Law

The decision to start a business is a life changing one that can improve both your life and the lives of your loved ones. In order to benefit fully from your new venture, do what you can to legally protect your new entity. The professional and experienced attorneys at Resnick Law are here to answer your questions and provide you with the legal support that you need. Call our office today to schedule an initial consultation so that our team can begin answering your questions and providing you with the business law advice that you deserve.

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As first reported by the Lansing State Journal, one of the USBA’s senior officials recently gave a talk in East Lansing to help fledgling Michigan-based entrepreneurs.

“Small businesses are the fabric of our community,” Marianne Markowitz, the SBA’s regional administrator, said during a networking luncheon earlier this month. “Every day can be a struggle when a business owner is working to move a business forward.”

The perception of struggle can be as daunting as the facts on the ground. The National Federation of Small Businesses Research Foundation, a nonprofit group that promotes entrepreneurship last month published its latest trends report noting that small business optimism fell one point from the previous month, falling to 92.9. None of the 10 Index components posted a gain, six posted small declines, and four were unchanged.

The NFSB report was generally ho-hum, with the small business sector seemingly just treading water — waiting for a good reason to invest in the future. The political climate was the second most frequently cited reason for the current feeling of cautiousness in looking to launch or expand.

However, overall economic data still looks positive and the state’s future growth continues to trend upward. Fundamentals are in place for continued small business creation and the simple advice that USBA official offered is sound. So we decided to pass it along:

1. Draft That Business Plan

“The most important thing is to have the business plan in place,” Markowitz said. The SBA offers a free template to help people draft one on sba.gov. Completed samples can also be requested to show how others have approached their plans.

2. Don’t Do It Alone

The SBA offers many free resources to first-time business owners to help them get on the right track, including business workshops on different topics such as access to capital, financial literacy, marketing and using social media. For information about local workshops or assistance, call the Michigan district office in Detroit at 313.226.6075.

3. Be Wary Of Predatory Lenders

Getting access to capital isn’t as hard as it was during the Great Recession, but the biggest challenge business owners face now is getting the proper capital. “You need to be careful where you are sourcing your capital from,” Markowitz said. “High interest rates can put you out of business real quick.”

SBA has a program called LINC, Leveraging Information and Networks to access Capital, which acts as a matchmaker to borrowers and SBA-approved lenders, especially local micro-lenders here in Southeast Michigan.

“The best thing we can do is help educate our small businesses,” she said.

For more information on small business formation and how our attorneys can help, call us at 248.642.5400 or contact us online for a free consultation.