Starting a new business is an exciting journey, but before launching a product or service, you need a strong legal foundation. The choice of operating a business as a sole proprietorship or through a separate legal entity, whether a corporation or a limited liability company (LLC), affects everything from your personal liability to how your business is governed and taxed. This article discusses the key considerations before forming a legal entity for a new business.

Starting a new business is an exciting adventure, but it comes with important legal responsibilities. One of the foundational steps to ensure long-term success and avoid costly complications is preparing the right legal documents from the outset. These documents not only establish your business’ legal structure but also define ownership and responsibilities, ensure legal compliance, enable smooth operations, and protect your intellectual property and confidential information. In this article, we’ve broken down essential legal documentation for new businesses into five core categories to help you set the foundation for success.

When starting or restructuring a business, the legal entity you choose defines your legal liability and operational framework. However, it is the federal tax classification that determines the taxation of your business, including how your profits are taxed, what limitations may apply, and what reporting requirements you must meet. Federal law establishes default tax classifications based on the state-level entity. A state-registered corporation is, by default, taxed as a C corporation. A limited liability company (LLC) with a single owner is treated as a disregarded entity, while an entity that is not a corporation and has multiple owners (e.g., a state-registered partnership or limited liability company) is taxed as a partnership. In many cases, eligible entities can elect to override these defaults and choose a different classification by filing Form 8832: Entity Classification Election or by making an S Corporation election by filing Form 2553: Election by a Small Business Corporation. Understanding the distinctions between potential tax classifications for your business is crucial for effective tax planning. This article provides a brief overview of the federal tax treatment for the most common business structures.

A successful workplace is built on a foundation of legal compliance. As an employer, navigating the complex landscape of federal and state labor and employment laws is critical for protecting your business and ensuring fair practices. This article outlines key obligations and considerations for employers in Texas to help you maintain a compliant, equitable, and productive environment while avoiding costly regulatory penalties and litigation.

When buying or selling property in Texas, understanding the legal considerations throughout each phase of the transaction is essential to protect your interests and ensure a smooth process. This article walks through each critical phase, from pre-contract preparation through closing, outlining the essential documents and highlighting the legal considerations that matter most to each party.

Buying or selling a company (commonly referred to as mergers and acquisitions or “M&A”) is one of the most significant and complex decisions a business owner will ever face. Navigating this process requires careful planning, thorough due diligence, and experienced legal guidance. This article outlines the key legal steps and considerations for M&A transactions, including how to structure the deal, what documents to prepare, and which certificates or regulatory clearances may be required specifically for Texas businesses.