You can incorporate online for less than an attorney will charge, however, you must remember that there are only two reasons to incorporate or form an LLC. One reason is for the savings provided in the tax structure and the other is to limit your liability. A company that is not properly formed may not be considered by courts to be a “legal entity” (a term used by attorneys for companies such as LLC’s, corporations, etc) which may lead to personal liability.
In order for the
company to be a “legal entity,” it must
follow guidelines that allow it to
operate legally. You must properly form
or incorporate, keep accurate records,
obtain employee identification numbers,
pay taxes, file quarterly returns, keep
minutes, issue stock or units, sign
documents correctly, and conduct
You may also need professional licenses, occupational licenses, bonds, insurance(s) and other permits depending on your business. If not, you may believe you have a corporation or LLC, but a judge may decide otherwise. This is known as piercing the corporate veil. It is the legal equivalent of believing you have a bullet proof vest but only having on a thick sweater. This false belief can cause a person to take on more risks by believing they are protected when no protection exists.
Often clients come in after they have been served by the sheriff and say, “How can they sue me as an individual? I have corporate protection!” Often, the business has not followed many of the requirements, and the law suit is the first notification that they may have an issue. As a side note, most businesses are not sued when they are new. The owners are often successfully operating, but have never spoken to an attorney regarding if the business was formed properly and operates as a true “legal entity.”
At the Affinity Law Firm,
we are very competitive with our rates
and our work is performed by staff that
understands the need to be legally
protected. It is your choice on whether
to hire an attorney to form your
corporation. But, if you choose not to
use an attorney, at least buy a good
book on corporations.
“I am educated and can understand the contract …why should an attorney review it?”
This is a very common mistake of many entrepreneurs. Even if you are diligent, read all the fine print, and lookup and the definitions of “legal” words, this is often a costly mistake for several reasons:
- Contracts often have words that have a legal meaning which is different than the common usage of the words. Common words like property, owner, assignment, infant, capacity, consideration, and many other words, have slightly different meanings which can change a contract.
- The American system of government has a constitution, as well as federal laws, state laws, and local laws. These rules don’t always appear to make sense, but they may give or take away rights even if you “contract away” or “waive” your rights. For example, you cannot work for less than minimum wage even if you agree to, as it would be illegal.
- Contracts often have legal challenges for what they don’t say or should have included. A person might find an excellent binding contract online and have another person sign the contract, but find themselves with no recourse. Often times, these online forms do not contain necessary provisions for reasonable enforcement of the contract, and the only option for the person who found the contract online is to file suit.
- Last, but not least, sometimes there is a better way of doing the same deal. People often write contracts for situations that could be better taken care of by a different action. Examples of this are often found in real estate transactions. For example: a person might spend several hours to draft a no-lien provision into a real estate contract. This is generally performed by the title company prior to closing as all liens must be satisfied if title insurance is to be issued.
“I’m young and don’t have much, why would I need a will or trust?”
Young people often feel
that they are not likely to die despite the
fact that almost every young person knows a
peer that died. If you don’t have many
assets why would you need a will or a
trust? Just ask yourself, why do most young
people die? Accidents are usually the
reason – often car accidents. Just assuming
that the odds are even whether it was your
fault or theirs, 50% of the time, the
circumstances surrounding the accident could
produce a large payout from the other
person’s insurance. Settlement offers vary
but are usually a minimum of $25,000 and
may be as much as a $1,000,000. Most people
would rather have a say of who should
benefit from their money if they die instead
of state rules that were developed many
years ago. A simple will can prevent the
state from deciding where your money is
“I’ve dealt with attorneys in the past, why do they always end up as deal-breakers?”
The Affinity Law Firm has often heard entrepreneurs complain that the “attorneys killed the deal.” It is possible that the reason for this was that the deal was illegal, likely to produce major law suits, or that the deal was not properly understood by all the parties.
At the Affinity Law Firm each of our attorneys wants to put together every deal. It is not our policy to add unnecessary protection clauses into contracts which may cause the other party to back down. And, if a deal is currently structured and is legally unsound, we will do our very best to change the structure to fix possible illegalities or exposure to law suits so that all parties are in agreement. The attorneys at the Affinity Law Firm have very diverse backgrounds and understand the desires of entrepreneurs to see their plan to completion. The Affinity Law Firm prides itself on the ability to work with business owners to “get it done.”
One of the services
the Affinity Law Firm offers is a
business consulting package which
includes both business and legal
consultations. All of our attorneys
have multiple disciplines of study
such as MBA’s, extensive real estate
experience, and ownership of many
businesses prior to their legal
career. This multidiscipline
approach helps us to understand the
needs of your business and offer
options that an entrepreneur may not
“I’ll just wait until I see if I need an attorney…”
Affinity Law Firm receives calls and consultations where the client has already waited too long to see an attorney. In law there are many deadlines. The purpose of these deadlines is to bring the issue to a quick resolution. Many times a law suit is filed, and time constraints limit what can be argued in court. Many defenses and counterclaims must be initiated on the first response or they are waived / lost.
Although some lawsuits settle very quickly, many will go to trial or settle very shortly before trial. It is not uncommon for someone to see us until after it is too late. Failure to consult an attorney early in the law suit may prevent you from having the opportunity to present items of evidence in a case. This could quickly turn a wining case into a losing case.
Do not ignore legal items such as summons, subpoenas. If you are unsure, a quick consultation can give you the information that you need to make an informed decision.
“I can’t afford an attorney!”
Many people have no idea what attorneys charge but all have heard about the “enormous fees” that some people have paid. This generally is not true. Obviously legal fees vary by the amount of work required, court fees, filing fees and the nature of the legal action, however, many business related tasks like reviewing a contract are often under a $100. People often sign contracts for very expensive items and depend on the other person to form the contract and then sign it without even reading it. Often this can lead to major costs later that you may not be aware of that could have easily been avoided.
At the Affinity Law Firm, we have options for businesses and individuals that make the cost of having an “attorney on retainer” very affordable. This service was developed after realizing that most small business owners don’t use attorneys as often as they would like because of the unknown costs. We have a simple program that almost any business can afford which offers them access to legal advice when they need it. Contact us for details.
“I don’t have a written contract so I can’t do anything!”
This is simply not
true. People often
have the possibility
of enforcing or
even though they
don’t have a written
usually prefer to
have a written
contract but many
times they are able
to enforce an oral /
Also, many people
believe that if they
haven’t signed an
agreement they do
not have any
liability – this is
also not true.
The information provided in this website does not constitute legal advice nor does it constitute an attorney client agreement. You will not be considered a client until we have accepted your matter and an agreement is signed. For more information, read our disclaimer.