When you’re starting a new company, the number of decisions you have to make can seem overwhelming. Not only must you raise capital, make a viable plan, hire employees, and so on, you have to think about whether or not you need a business attorney. In many cases, the answer is no. With some qualified help, you can do a lot of things on your own. However, there are times when a lawyer is absolutely essential. And then there are other times when it’s better to have one that not.
There are a number of decisions you’ll have to make or processes you may have to go through that will require the help of a good business attorney. For instance, many small company owners like to get together with their partners are create what’s called a special allocations fund. This fund can be put right into your agreement or the LLC statement. If you’re going to do something like this, you’ll want to get a good lawyer on board and have him take care of the more complicated legal areas.
I am a lawyer and for the first 5 years of my career, I was the legal counsel for a small corporation here in Texas. I worked as an in-house lawyer, specifically under their insurance department. My job was simple: to make sure that the insurance department was carrying out claims in the most legal manner as possible and that clients’ rights were protected. Fast forward to today, I am now in private practice and I find myself dealing with insurance companies that don’t have their own lawyers. The question here is: should every business have their own lawyers?
My answer is YES! First, it helps having a lawyer as a retainer in your company because he’s paid on a salary rather than having billable hours. he may not be earning as much as the private practice lawyers, but he has a consistent income. Second, you don’t need to go look for a lawyer because you already have one. The moment you have legal issues, you simply need to phone them in. lastly, having a lawyer in your company will be for the benefit of your employees because they can go to him or her when they have legal issues.
Why do we call ourselves the best business lawyers in town? First, we’ve got the experience. Our sum total of experience as lawyers is close to 100 years, with close to 8 associates and 10 paralegals working side by side. We’ve been through every case imaginable and we know how to protect your business inside and out. From protecting your assets to providing coverage for your employees and protecting their rights, our services are considered as the best.
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Second, our law firm is comprised of individuals who have different specializations yet work together towards the same goal: towards the protection of business entities in the corporate world. We have different lawyers who specialize in making contracts. We have lawyers who specialize in employee rights and compensation. We also have lawyers who specialize in corporate tax and assets. We have lawyers who are the jack of all trades, so in a sense, our law firm is also a jack of all trades.
Are you going to do business negotiations or transactions with other companies? Let us be there to make sure that everything goes according to plan and that you won’t be screwed over. Are you going to franchise your company to a foreign investor? We’ll be there to make sure that the transition and business negotiations are in place.
Receiving a letter from the IRS informing you of an audit is not a reason for panic especially if you file your business tax properly and on time. However, with all the other things that you need to attend to, balancing your time between managing your business and keeping track of your tax obligations can be tricky. For this reason, you can simply commit mistakes that would unintentionally give a red flag to the IRS. It is for this reason that every business should have a business tax attorney to avoid such problems and make resolutions if the need arises.
Keeping accurate records
Hiring an attorney for any reason can be expensive. Many people and business owners put off the idea of hiring a business tax lawyers unless they really have to. Oftentimes, this is a mistake that could potentially put you out of business or cost you more than what you are capable of paying. If you want to avoid hiring a business tax attorney and avoid audit from the IRS, you should keep all accurate records of all your financial transactions especially documents to prove your deductions. Organizing your records will make it easier for you to prepare your income tax returns and minimize errors.
Organizing your records
To keep track of all of your expenses and deductibles, organize all your bills in a file and keep stubs of your checkbooks. Keep your receipts and categorize them so you will know which receipt is for a particular bill. Throughout the year, keep your deductibles in a journal together with all supporting documents and track your cost basis for every property and taxable investments. This may seem like a tedious process but doing so will save you hundreds, even thousands of dollars in back taxes and business tax attorney fees if ever faced with an IRS audit.
Chances of being audited
For an average taxpayer, chances of being audited by the IRS are relatively low. However, there are certain factors that could contribute to the likelihood of being audited. These factors include large amount of charitable deductions, large business deductions, inaccurate reporting of your W-2 or 1099 form, too much itemized deductions, cash receipts that are concealed, previous records of tax audits or problems, and complex business and investment transactions.
In case of an audit
If called for an audit, you have to make all the necessary preparations. If you decide to attend an audit yourself, provide only information that is related to the audit and never volunteer additional information as you may be subjecting yourself to further investigation. Respectively, it is highly recommended that you get a business tax attorney since they are very adept in the matter and cannot be easily intimidated by an IRS agent. They are also knowledgeable in the ins and outs of the system so they know how to come up with a fair negotiation with the IRS. They will be able to correct any errors and make amendments in your tax returns to minimize the amount of back taxes you owe, if any.