Legal Question in Business Law in California

Re: Sole proprietorship paperwork?

I tell my clients that it is cheaper to pay an attorney up front and have things done correctly than do the things yourself and have to hire a lawyer to fix your mistakes. Often these mistakes lead to litigation, which is very expensive.

My recommendation is to get a lawyer involved now. An honest lawyer will tell you what you can do safely on your own. But don't venture into the unknown by yourself.

Feel free to call or email. We practice business law and would be happy to help.

Re: Sole proprietorship paperwork?

You'll almost certainly need a business license from your locality. If you are doing business under a name other than your own, you'll also need a fictitious business name filing, sometimes also known as a DBA (doing business as).

You don't say what sort of business it is, or why you seek to form an LLC, but if it is a business that is prone to liability risk, such as construction, waiting a year may be too late. If a lawsuit is filed before you form an LLC, it will be too late for any protection from personal liability the entity may provide.

When you hire a business attorney, he will advise you - preferably working in conjunction with your tax accountant - on the selection of a C corp, S corp, LLC, or other entity that is best suited for your business. A knee-jerk LLC should not rule out consideration of other business entities.

The foregoing information is of a general nature and is not intended as legal advice, which is provided to clients only. Licensed in California and Illinois.

Re: Sole proprietorship paperwork?

I'd agree with pretty much everything other counsel have told you. You should also consider other permits and licenses you may need. The state of California maintains a fair website for identifying such permits, etc. Visit http://www.calgold.ca.gov/ and follow the instructions.

Best of luck

Re: Sole proprietorship paperwork?

You don't need to do anything formal for the sole proprietorship unless you are doing business under a name other than your personal name. You would then need to file a fictitious business name statement with the county recorder's office of your principal place of business. It doesn't cost a lot and is a simple document you should be able to fill out on your own. You also need to contact the city/town clerk regarding a business license. If you are working from home, sometimes there are restrictions on the type of business you can run from your home. (You probably can't run a mortuary in your spare bedroom).

Make sure you get a bookkeeper or CPA to keep financial records of the busines straight. When you eventually incorporate or form an LLC, you will want to have the proper records for a tax free exchange of the sole proprietorship into the entity.

If you have any questions, feel free to give me a call at (415)492-2041.

Regards,

Re: Sole proprietorship paperwork?

You may need to get a fictitious business name. You should consult an attorney before you complete any paperwork to make sure that the business entity you are forming is appropriate. My firm helps small businesses with these decisions and can be reached at 247 6868.