Page 116 - Winning The Credit Game Bundle (CK Patrick)

Be prepared to deal with potential customer,
employee, or subcontractor lawsuits.

This list deters many people from starting their own busi-
nesses, as many of these steps sound difficult or complicated.
However, here I will show that they’re not hard to do. We will go
through the major steps necessary to set a business up for legal
or financial success together.
I need to put a major disclaimer here: because laws vary by
city and state, you should also consult your city and state’s laws
on these matters. I will share general information from a U.S.
federal perspective, but the regulations for your city or industry
may differ. Some states require more paperwork, licenses, and
fees than others, and the same business may or may not need a
license, depending on the city and state it is located in.
My goal here is to give you a good start so that by the time
you go through these steps, performing any additional steps
your city or state may require of you will seem easy!

HOW AND WHY SHOULD YOU REGISTER YOUR BUSINESS?

Registering a business means filing paperwork with your city
and state to establish your business as an official legal entity.
This is usually required in order to file taxes and procure busi-
ness credit, as lenders and creditors need legal documentation
proving that a business is an established legal entity before they
can start reporting its credit score to credit bureaus and certainly
before they will think about lending a business money.
Incorporating your business as a legal entity can also offer
some protection against the consequences of bankruptcy and
lawsuits, since these may be filed against the business as a legal
entity instead of against the owners as individuals.
This is not a “get out of jail free” card—if a business owner
can be proven personally responsible for legal or financial
misconduct, they may still be the recipient of the consequences.
But under other circumstances, the owner can be partially

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