More people than ever before prefer running their own businesses from home, businesses which are both fulfilling and lucrative. Running your own business at home offers you several advantages, including the fact that you are your own boss and you get more time to spend with family. Also, it offers you a more flexible lifestyle; however, there are legal things that need to be taken into consideration.
The last thing home-based business owners need to deal with is a lawsuit, something that is more likely to occur in today’s litigious society. This is why you should start taking steps to ensure your business is protected from being sued. Here are four things you ought to implement to keep your home-based business legal and out of trouble in future.
Get A Business Name And Protect It
One of the first things you have to do, as you start your business, is choosing a business name that resonates with the products or services you are selling. However, you need to protect the name by ensuring that it is not in use by executing a trademark search and registering it through a trademarking attorney. If you do not do this, you will likely have to change the name somewhere down the line (confusing your customers) or even face legal liability.
Get A Business Tax ID
While the Employer Identification Number (EIN) or a business Tax ID is not a legal requirement in the country, it’s still a good idea to have one. You can use this number for ordering items from suppliers, when hiring employees or even when taking on new business partners. In addition, using your personal SSN will leave you and your business vulnerable to identity theft.
Moreover, the EIN will help keep your personal and business assets separate; and legal compliance is a requirement for businesses that accept credit cards. This means that any money coming from your customers is deposited into the business’ account and not your personal account.
Alternatively, when you buy a computer or a car, it can be registered under your company’s name, protecting your personal assets in case an individual suing you win the case in court.
Keep Your Business Insured
Ensure that you are careful when it comes to your business insurance policies by setting up alerts and reminders of when they are due. That one day you are not covered is all it takes for a customer to take you to court. In the event customers come to your house to pick their orders, for example, get a third party general liability cover in case of a slip and fall incidence on your property.
If you are providing consultancy services, a purchase insurance cover should sufficiently protect you from any errors and omissions that may occur while advising a client. To keep your premiums low, ensure that your grounds are free of slippery spots and barriers, get a good computer backup system, and install a security camera system.
In addition, conduct regular audits of your system and keep proper records of employees and work schedules through spreadsheets you can download from Clockspot for instance.
Know The Laws Of Your State
While general business advice sites offer you tips on a huge array of legal business issues, they rarely go into the specific state information. So, reading the online material on the type of licenses, permits and certifications you need for your business should only act as a guide. You can get specific information on the legal requirements of your business, depending on what you are doing, from your local county or city council office.