Essential Legal and Business Advice for Starting Your Own Business

November is National Career Development Month—the perfect time to turn your entrepreneurial dreams into reality. As a business attorney who works closely with solopreneurs, mom-and-pops and other small business start-ups, I've seen ventures that thrive and those that struggle.

Here's my advice for aspiring business owners:

Choose the Right Business Structure

A critical first decision is choosing the appropriate legal entity. Sole proprietorships (simply opening a business without more) are simple but offer no personal liability protection. That means your personal assets—your car, your house, your savings – might be at risk for business obligations.  LLCs provide liability protection while maintaining tax flexibility and simpler management requirements. Corporations offer similar liability, but come with more formalities and potential double taxation (unless you elect S-Corp status). Don't default to the easiest option—consult with an attorney and accountant to determine what fits your specific situation, growth plans, and risk tolerance.

Protect Your Personal Assets

I cannot stress this enough: keep your business and personal finances completely separate from day one. Do not co-mingle the business funds and your personal funds. Open a dedicated business bank account, obtain a separate business credit card, and never commingle funds. Don’t just take $20 from the register for supplies or gas.  Treat your business like you are working for IBM—fill out an expense report. Show the cash coming in and going out.  This separation is crucial not just for accounting clarity, but for maintaining the liability protection your business entity provides. You cannot treat your LLC bank account like a personal piggy bank—this often allows creditors to "pierce the corporate veil" and seek your personal assets.

Get Everything in Writing

Whether you're working with partners, vendors, contractors, or customers, document your agreements in clear, written contracts. This includes partnership agreements, operating agreements, employment contracts, and customer service agreements. These documents aren't just for when things go wrong—they provide clarity that often prevents disputes from arising in the first place. While not optimal, a sting of emails or texts can sometimes be enough writing to constitute a written contract. The problem with verbal contracts is that they are not valid of all business scenarios, and it is  hard to prove what the actual agreement is.

Understand Your Licenses, Permits, and Compliance Requirements

Every industry and location has specific requirements. Research what business licenses, professional licenses, permits, and registrations you need at the federal, state, and local levels. For the most part, North Carolina has very few licenses or permits at the state level, but there may be local zoning laws that matter. Don't forget about ongoing compliance requirements like annual reports, tax filings, and license renewals. Setting up calendar reminders for these deadlines can save you from penalties and potential business suspension.

Invest in Professional Guidance Early

The money you spend on professional advice at the beginning can save you exponentially more down the road. A good attorney can help you structure your business correctly, draft solid contracts, and avoid costly mistakes. An accountant ensures you're taking advantage of available deductions and staying compliant with tax obligations. They can also make sure you set up your pricing and bookkeeping correctly from the beginning.   A business insurance agent protects you from unforeseen risks. These aren't luxuries—they're necessities.

Plan for the Long Term

Finally, think beyond the startup phase. Build systems and habits that will scale with your growth. Keep meticulous records, maintain separate finances, review and update your contracts regularly, and stay informed about changes in laws affecting your industry.

Starting a business is an exciting journey filled with challenges and rewards. By laying a strong legal and operational foundation from the beginning, you're positioning yourself for sustainable success. Here's to your entrepreneurial future!