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Buying a Business? Consider Getting an Attorney’s Help

Business litigation attorneyIt’s part of the DNA of any business: a desire to expand and take on new challenges. One time-honored way for a business to do that is to simply acquire another business. Or, rather, it may seem simple – but as with many transactions in the business world, there are complexities beneath the surface, and a smart business owner will not tread those waters alone. Know the Different Types of Business Purchases When structuring the sale and purchase of a business, there are two options: an asset purchase or a stock purchase. Both have advantages and disadvantages, and to make the right choice, you need to understand the implications of each type, including what is actually included in the sale under each structure and the tax implications of both. In an asset purchase, the buyer agrees to purchase certain assets from the seller, including things such as fixtures, equipment, licenses,…

Why Is a Business Succession Plan So Important?

Business Succession planning attorneysFor many entrepreneurs, the present day is challenging enough. Starting and managing the day-to-day affairs of a business is a massive effort that can leave even the cleverest owners with little energy left to think about tomorrow. But every small business, sooner or later, will face the reality that its leader won’t be around forever. Planning for what happens after a founder moves on can mean the difference between success or failure for the business. The Second Generation—and Beyond The statistics are inarguable: Family businesses are an enormous part of the American economic landscape. Research has shown that family businesses account for 64 percent of U.S. gross domestic product, generate 62 percent of the country’s employment, and account for 78 percent of all new job creation. But research has also shown that less than one-third of family businesses survive the transition from first- to second-generation ownership. Another 50 percent don’t survive the transition from…

How the Shutdown Impacted Small Businesses

Impact of the Government ShutdownAlthough Congress and the President appear to have reached an agreement to fund the government for a brief period while they work on other issues, a great deal of damage has already been inflicted. Hundreds of thousands of federal employees went without pay or without work for over a month, and many key agencies slowed or stopped their activities altogether. The ripple effects of the shutdown spread throughout the economy in ways both large and small. One key group impacted by the shutdown is small businesses which rely on smooth government operations so they can continue to run. Here are some of the ways the shutdown impacted these companies: Support Businesses: Small businesses often spring up in areas where large numbers of federal workers will utilize their services, especially in Maryland, Virginia and the Washington, DC, areas. Everything from diners/restaurants and coffee shops to office supply stores and delivery services lost…

New Insight for Women Entrepreneurs

New Insight for Women EntrepreneursIf you’re a woman thinking of starting your own business, you’re not alone. According to SCORE, a national nonprofit dedicated to helping small businesses, women-owned businesses currently make up 39 percent of the 28 million small businesses in the United States. And, SCORE notes, that number is rising. Between 2007 and 2016, the number of women-owned businesses rose 45 percent—five times the national average, according to the U.S. Census Bureau. SCORE recently released the results of a wide-ranging survey of more than 12,000 female entrepreneurs. The report, “The Megaphone of Main Street: Women’s Entrepreneurship,” contains several key insights on the unique opportunities and challenges these business owners face. Why did these women start their businesses? They reported many different motivations, such as open opportunities, family considerations, job changes, and financial necessity. One interesting detail is how the reasons differed for each age demographic. Most of the women surveyed under age…

To Lease or to Buy Your Small Business’s Office Space?

To Lease or to Buy Your Small Business’s Office Space?Anybody who starts a small business is immediately faced with a seemingly never-ending series of decisions. Some are small, and some are large, but they all have the potential to impact your bottom line. One of the most important decisions a business owner will face early on has to do with office space. Is it better to lease or to buy your small business’s office space? Here are some things to keep in mind while you make this decision. Upfront costs: When you buy commercial real estate, you may typically have to invest up to six times in upfront costs compared with leasing commercial real estate according to an article on FitsSmallBusiness.com. Most purchasers of commercial real estate finance the purchase with a loan that may require up to 20 percent as a down payment. Add in due diligence fees and closing costs, and this becomes the largest drawback to purchasing commercial…

Picking the Right Structure for Your Business

Picking the Right Structure for Your BusinessStarting a business means making dozens of choices both big and small. One of the most important choices you will make is how you will structure your business entity. Two of the most common options are the S corporation (S corp) and C corporation (C corp). If you don’t understand the difference between the two, you’re not alone. Many budding entrepreneurs ask questions about which business structure they should choose. And yet it’s one of the most important decisions you’ll make about your business. C Corporations are the standard corporation, whereas the S corporation takes advantage of a special IRS tax status. S corporations are so named because they are defined by Subchapter S of the Internal Revenue Code. IRS Form 2553 must be filed to elect S corporation status and all S corporation guidelines must be met. How S Corps and C Corps are Similar C corps and S…

Why Many Women Prefer Hiring a Female Attorney

Why Many Women Prefer Hiring a Female AttorneyWhen people seek legal representation, they want someone who understands their experience. Clients often feel more comfortable with an attorney they can relate to, which is one of the many reasons women seek female attorneys to represent them. Rebekah Lusk is a fierce advocate for female clients and a successful entrepreneur in her legal practice. She realized early in her career that to gain respect from others in the legal field, she would need to have her name on the door. Naturally independent, outspoken and authentic, Rebekah found that playing to those strengths were essential to establishing herself in her field. We asked Rebekah Lusk about the work she’s done for her clients, to learn more about her experience as an attorney and businesswoman. Question: You have heard from several female clients that they were specifically seeking a female attorney. Why do you think that is? Rebekah Lusk:  I think women…

Should You Hire an Employee or a Contractor? 

Should You Hire an Employee or a Contractor? Many small business owners will need to hire someone at some point. There’s no formula for determining when you’ll reach that point, but if you feel you’ve been working around the clock, or you can’t keep up with your current volume of business, now may be the time to bring someone on board. First, you’ll need to figure out whether you need an employee or an independent contractor. The following is an overview of the pros and cons of hiring employees or contractors. Hiring Employees: Factors to Consider If you hire an employee, you control how, when, and in what capacity they work. So if you need someone to work specific times, or at a specific location, you’ll need an employee. And if you need someone to fulfill an essential role – like management – you’ll definitely want an employee instead of a contractor. Before hiring an employee, you’ll have…

Gallup Poll Finds Small-Business Owners Optimistic

Business StructureAccording to a poll conducted in October, 71 percent of small-business owners said their company finances were “very good” or “somewhat good” – that’s an increase of 5 percent, compared to the same quarter in 2016. The quarterly Wells Fargo/Gallup Small Business Index poll asks business owners about their current business profile, as well as their expectations for the next 12 months. About a third of the 602 October respondents said they plan to hire more workers in the coming year, and only four respondents said they plan to reduce staffing levels in the coming year. Small Business Trends The Wells Fargo/Gallup Small Business Index is a numeric score between -60 and 150, based on finances, revenue, cash flow, capital spending, number of jobs, and ease of getting credit. The index began in 2003, and its lowest point was in October 2010, at -28. Since then, it’s crept upward –…

Tax Tips for Small Businesses

Maryland Tax AttorneyDecember is just around the corner, so if you pay your taxes based on the calendar year, now’s the time to take a look at your income and expenses. Depending on your 2016 profits and your earnings projections for next year, you may want to make some adjustments before year-end. Cash vs. Accrual Accounting The type of accounting method you use may dictate your end-of-year tax strategy. Businesses use either cash or accrual accounting. With cash accounting, your income and expenses are not counted until actually paid. So, if you send someone an invoice in December and they don’t pay it until January, you wouldn’t claim that income on your 2016 tax return. Accrual accounting records transactions immediately – that December invoice would be considered part of your 2016 income, even before you receive payment. If you use accrual accounting and want to reduce your taxable income for 2016, you…