Even worse, the lawsuit may be reflected back to you your greatest fears about yourself and perhaps even about the work you do. But a lawsuit doesn’t have to spell the end of your business, nor the collapse of your dignity. Instead, it can be a big opportunity to see something that you otherwise couldn’t see about where you need to shore up holes and create systems to be able to grow your business.

If you haven’t already read it, my mentor wrote a Manifesto about the more than $1,000,000 mistakes she made when growing her business, including more than one lawsuit, and you can read that here, so you don’t have to make the same mistakes she did.

And yet, many business owners don’t pay themselves or rely on inconsistent income, to support themselves. If that’s you, it’s time to make a shift now. 

In most cases, paying yourself a consistent income that at least meets your base personal needs should be the first and highest priority of your business. And when you pay yourself in the right way, you can also minimize your taxes while ensuring your business has what it needs to grow as well. 

Of course, owning your own business also means that if your company doesn’t earn enough money, you might not get paid at all. And in the worst-case scenario, if you don’t structure your business’ legal, financial, and tax systems properly, you could even find yourself in a situation in which you don’t get paid, and at the end of the year you end up owing taxes that your company can’t afford to cover.

Today we’re talking about the importance of keeping meticulous records of everything your business does. It may be a little late for you to apply these practices to your 2019 business taxes, but that doesn’t mean you can’t get your upcoming records in ship-shape as soon as possible, and do better going forward.

Good record keeping definitely isn’t the flashiest or most exciting part of your business. In fact, it can be downright tedious. However, it is far more tedious to dig around through your files, email, meeting minutes, statements, and calendars for the information you need to complete your taxes, get access to capital, or defend your assets, if necessary.  

The possible consequences of not keeping good corporate records should be enough to inspire you to cover your bases. First, if you ever end up in a lawsuit, you need to be able to prove to anyone who files suit against you that the "corporate veil" is in place. The "corporate veil" is like an invisible, yet strong, shield between your personal assets and the business's activities. It's this shield that makes it so you won't be personally liable and have to use your own assets to pay back debts or other obligations of your business. 

In fact, buying an existing business and making it your own is often a much more efficient, economical, and prudent way to fulfill your entrepreneurial dreams.

Given that roughly 10,000 Baby Boomers turn 65 every day, and this trend will continue until 2029, when the generation’s youngest members reach that milestone, right now is one of the most opportune times to make such a purchase.

Indeed, the retirement of Baby Boomers is such a major shift in demographics, it’s been dubbed the “silver tsunami,” and it has the potential to flood the market with a significant number of highly profitable businesses being put up for sale. According to the California Association of Business Brokers, over the next two decades retiring Boomers will sell or bequeath more than 12 million businesses, with a total value estimated to be worth more than $10 trillion.   

As you begin this process, it is critical to note that expansion, while providing a great opportunity to increase productivity and scale, can also expose your business to additional risks. As you prepare to expand your workforce, keep the following questions in mind: 

1. Are you hiring an independent contractor or an employee? One of the most important things to remember is that a worker’s classification impacts your legal liability and tax obligations. For example, you are not responsible for withholding taxes for an independent contractor. However, you are required to withhold certain taxes from an employee’s wages. A worker’s classification on paper alone is insufficient; the actual dynamics of the working relationship determine it. If you exert substantial control over what a worker is doing, and the worker has very little independence, the worker will likely be classified as an employee and therefore entitled to the rights of an employee. Be diligent in establishing the parameters around each working relationship.

Due to government-mandated business closures and stay-home orders, many owners and employees of small businesses have been forced to work virtually, and they have seen the benefits. Studies show that remote working increases productivity. Large technology companies like Facebook and Twitter have announced that they will be implementing remote working until at least September 2020. Some companies have even gone as far as to give employees the option of working from home permanently. The “new normal” that many predict involves more companies maintaining a remote workforce.

As a business owner, you may be exploring the idea of permanently utilizing a remote workforce; however, you may not be aware of all of the relevant factors to consider and preparations to implement. Be sure to take the following measures as you move toward permanent virtual employment.

Purchasing a company that is already in existence is a valid alternative. If you are interested in potentially acquiring a business instead of starting one from the ground up, there are several vital questions to answer.

Do you want to purchase an independent business or a franchise? One decision you must make is whether you wish to buy a franchise or an independent company. Each option presents its own unique set of circumstances. With franchises, you are part of a systematic network built around an established name. There may be stringent requirements regarding the systems and procedures you must follow as a franchisee. If you opt to purchase an independent business, you may enjoy the benefit of increased flexibility, but may require more research and business development to acquire the same level of recognition an established franchise— properly situated—may have.

Yet far fewer business owners put the same amount of effort into planning for their company’s continued success following their retirement, death, or incapacity.

Not planning for the future of your business after you retire, become incapacitated, or die, could have potentially disastrous consequences for you, your clients/customers, and your family if (and when) something should happen to you. Indeed, creating a comprehensive succession plan (as part of your overall estate plan) is every bit as critical as any other planning you do for your business, if not more so.

Whether you exit your business with a sale, your incapacity, or as a result of your death, there will come a time when it’s time to go. To ensure your company continues to prosper once you are no longer in the picture, here are three tips for developing a sound business succession plan.

Whether that decision arises from failure on the employee’s part or economic turbulence, one thing is clear: How a business handles this delicate situation can either increase or decrease the risk of negative consequences like lawsuits and unfavorable public attention. Here are the best practices to keep in mind if you are considering terminating an employee.

1. Involve your Human Resources department from the beginning. The Human Resources (HR) department of your company can be especially helpful during the termination of an employee for a number of reasons. First, HR is likely familiar with (or has access to records regarding) the employee’s hiring process. Second, HR staff are likely trained to understand the implementation of applicable laws and to handle delicate situations with personnel. Third, HR can ensure that the final payments and health benefits issued to the terminated employee comply with legal requirements. Finally, your HR team can provide at least one witness to any termination meetings or communications that occur. With this training and experience, they are uniquely equipped to advise you regarding the proper steps to take.

Most elements of business branding—name, logo, design—are readily available online, making it easier for people to knowingly or unknowingly use the intellectual property of others. As a business owner, you must prioritize both protecting your own trademarks and avoiding infringement of others’ marks. The following are important concepts to understand as you develop your business’s trademark strategy.

1. What is a trademark? A trademark identifies a business or individual as the source of a good or service. It can take the form of words, phrases, symbols, designs, colors, or a combination of elements. Marks that identify the source of a service are called service marks; however, in practice, the term trademark is broadly used to identify both service marks and trademarks. The United States Patent and Trademark Office is the federal agency responsible for reviewing and registering trademarks in the United States.