We frequently get asked why someone should spend money on a lawyer to start up their small business rather than form their company with forms they found themselves online. The answer is simple. There are two main reasons to use a lawyer: a lawyer will help ensure that you pick the right entity for your situation and lawyer will draft (with your input) and explain all the documents necessary to get you company up and running.

When someone who isn’t trained in the law goes to an online website, they may choose to set up a limited liability company thinking that is the best entity structure for their company and disregard forming a corporation. However, if that same person had gone to an experienced lawyer, they may have been led through a series of questions, like those we ask our clients, to determine whether an LLC is correct. A lawyer may discover that for one reason or another, a corporation is best. Or a lawyer may discover that an LLC is correct and be able to guide clients through the choice of whether to make it member-managed or manager-managed.

In addition to helping a client choose the best business entity, a lawyer will help a client prepare the documents necessary to run the business including paperwork through the state, federal, and possibly city level. For instance, when our clients walk out the door after we set up their business, we try to ensure that all their documents are done (unless it is something that they personally have to do and we cannot as their counsel) and that they understand exactly what is in them. The last thing we want is someone to leave unsure of what their bylaws or operating agreement says. If you get a document from an website, you don’t know if the provisions in it are what you need (for instance, the last thing you want is an "Uh-oh, I don’t have any provisions for when my partner gets divorced and now the business is facing failure because of it). In addition, you may not understand all the provisions in it (for instance, you don't want an "Uh-oh, I didn’t realize that the way that clause was worded, a personal bankruptcy means a lot of problems"). When you hire a lawyer, they will probably ask you lots of questions to see what you need in your documents and then explain them to you.

Filing online is quick and it is easy. However, if you don’t know what you are doing, it could end up costing you down the road. Hiring a lawyer gives you the peace of mind knowing that someone who knows the ins and outs of forming a business is taking care of you and ensuring that you know what you are doing and why.

If you are starting a new business or buying new investment property, give us a call at 253.858.5434 to find out how we can be of service. We represent clients throughout Washington and Idaho and are available to meet in person, by phone, or via Skype or FaceTime.