Legal Question in Business Law in Pennsylvania

Re: Starting a business

You should form a legal entity such as a corporation or limited liability company. You should seek legal counsel. If you are on a limited budget start selling items privately until you have enough funds to form a start up legal entity. If you fail to take this action you might expose yourself to personal liability.

Gerald Hershenson Esq.

Re: Starting a business

You asked about what is needed, legally speaking, to start a business.

There really isn't that much needed to start a business, especially when operating on a shoestring. Sure, there are lots of preparations, risk considerations and filings a business needs to consider, but that will only matter if you have a viable business. You can legally start a business without doing anything.

The concern is what do you need to do? Here, you go: You need to keep absolutely impeccable records. This is especially important with regard to finances, debits and credits. A simple two column ledger is fine to start. Later, when you have some cash flow you can look into getting an accountant to help you set up a chart of accounts. But right now, just keep track of everything.

Next, you want to consider risks. Evaluate your assets and determine how much protection you personally need from your business. If you have lots of assets such as houses, cars, cash, and equities, then you will need more protection than some who is broke. Protection means insurance and status as a legal entity. No assests means you have nothing to worry about.

I could go on but my space on LawGuru is limited. There are plenty of places to go for free information and advice on starting a business. A few comments to start. If you will be using a trade name (a name other than your own name) the you should make a "Fictitious Name" filing (also know as a d/b/a) with your local town clerk. This protects your name and lets the public know that your are the person behind the business. You need to obtain state and possibly local merchant tax numbers so that you can collect and pay sales taxes. This information will be available on the respective web sites. You can operate on your own taxpayer identification number (social security number) until your business gets rolling. You may also need a local business license and your city hall can help you with that. If you want to hire an employee or start entering into larger sales or contracts then you should consult with an attorney.

As soon as possible, you should start drafting a business plan outlining the aspects of your business and your prosepcts. Start small and develop it as you learn. About the best place to start is with the U.S. Small Business Adminsitration. Their web site and offices have lots of free information and professional advice to help you get started.

The most important part is just to get started, you can always play catch up. But when you start to get successful and want to set up business formally, remember to contact me and we can discuss what you need to do next.

Good luck.

Regards,

Roger Traversa

Email: [email protected]

Phone: 215.279.8940