Do You Need a Lawyer to Set Up Your Small Business?

It's important to line up the right help when getting your business off the ground.

A record 10 million Americans applied to start new businesses over the last two years, according to President Biden in his most recent State of the Union Address. And if you're looking to kick off your own venture, you may be really excited to bring a great idea of yours to life.

Starting a small business can take time, and there may be different complexities to navigate and expenses to bear early on in the process. But do you need to hire a lawyer to start a small business?

The quick answer is, not necessarily. But you may need to bring in a lawyer later on. And you also might need the help of a different type of professional to set up your business.

Get the guidance you need

You may not have to hire a lawyer to set up your business, but you may want to hire an accountant at that stage of the game. An accountant can help you determine what structure is best for your business (for example, whether you should be an S-Corp or an LLC). They can also help you navigate tax laws and financial obligations for your business.

An accountant can also recommend a small business bank account to deposit your seed money. From there, they can help you manage your initial cash flow and determine how much you can afford to spend on different expenses, from staff to equipment to a lease you sign for your office or storefront.

You may need a lawyer down the line

In many cases, an accountant is all you need to set up a business. But once you start hiring employees, a lawyer might come in handy.

When you hire workers, you enter into a contractual agreement. And any time you're doing something like that, it's a good idea to consult a professional so your rights, and your company's, are protected.

A lawyer can help you create a standard employment contract for future hires to sign so you don't necessarily have to engage their services every time you need to grow your staff. But it's worth making that initial investment, especially if you're new to business ownership and have never had to hire anyone before.

It also may not hurt to have an attorney review other contracts you may be signing, like a storefront or office lease. That said, you may want an attorney who focuses on leases and real estate contracts to help you get your lease set up, and you may want an employment lawyer to help you put together your standard hiring agreement.

Don't go it alone

You may be prepared to take on a world of responsibilities as a small business owner. But that doesn't mean you shouldn't pay for some of the help you need early on.

Hiring an accountant to set up your business could help you land on the most cost-effective structure, resulting in plenty of savings over time. And hiring an attorney to review or advise on different contracts could also spare you a world of financial pain.