6: Nuts & Bolts

A chapter containing legal considerations for entrepreneurs could quickly become a 1,000-page treatise; however, our goal is to highlight the most common legal pitfalls for early-stage companies encountered during our years of working with small business owners. As we begin our discussion of the appropriate legal entity for your business, two things that will accompany that process are the establishment of a federal identification number (EIN) that will serve as the social security number for your business, registering your company’s name with the appropriate state office, and establishing a registered agent for your business. A registered agent maintains compliance by receiving all legal and tax documents for your business. If you are located in the state where your business is registered, you may simply serve as its registered agent, assuming that you are typically available during normal business hours. If your business is registered in one state and you are located in another, however, you will need to establish a registered agent in the state where your business is set up. Third-party registered agents can be found online or through the Secretary of State where your business is registered.