Your Legal Health Check-Up: Accounting, Banking, & Insurance
COMING SEPTEMBER 1ST: A LOW-COST WAY TO LEGAL
ON SEPTEMBER 1ST, we’re launching the Trellis Template Library™ an innovative new way to offer affordable LLC operating agreements, basic legal documents, and more. In short, we got you. With downloadable templates, detailed instructions and easy fill-in-the blanks, DIY legal can be way less scary, and it’s a way for us to grow with your business because you’ve got big dreams, and we want to support them!
In the meantime, get those ducks in a row and assess your business’s legal pain points so you know what you need. We started with entity formations & governing agreements - and now let’s talk money!
Do you have a chart of accounts? Do you know which taxes you need to be paying? Do you know the specific tax registrations you need to file? Establishing a relationship with an accountant is just as important as establishing one with a lawyer, but with the exception of tax attorneys, your lawyer will only advise on the legal side of your business operations. Tax and legal often overlap though (especially when it comes to entity formation or partner buy-ins), so if you need recommendations, reach out!
Your Money Vs. The Business’s Money
If you have an entity, your business funds and personal funds need to be separate. All business transactions should operate from a designated business bank account. The rule of thumb is: you can always cover business expenses from your personal account (and reimburse yourself or deduct it later), but never make personal expenditures from your business account. Even if you are running a sole proprietorship or partnership, having a separate business checking account is a good habit to establish to keep finances clean and adds clarity to deductions come tax time.
Hot Tip: Shop Around For A Bank for Your Business
Ask each bank if they have any minimum account requirements or fees. Also ask if they offer payment processing or other services that may be helpful for your business. Finding a bank that fits your business is important, especially as you grow!
While having an entity helps protect you from personal liability, insurance is a first line of defense. Remember- even if protecting your personal assets, you don’t want to lose your business in a legal battle either! Having insurance is crucial to covering costs if you get sued or if there is a fire or accident. Oftentimes you can get business liability insurance from the same agent as your home insurance, but it is also advisable to shop around. Talk to some agents, and make sure you tell them exactly what your business does, so you have all the right coverage you need. Hiding things from your insurance agent to save money on a premium can end up costing you a lot more in the long run. We’re building liability protection layers here - entity, then insurance...and in our next blog post… contracts!
Want a checklist for your legal health check-up? Sign up for our Resources Mailing List, and we’ll send you the full list as a free download as well as our new August resource - Client Contracts 101!
Plus, don’t hesitate to reach out if you need any accountant or banking recommendations!
DISCLAIMER: This blog post is meant for informational purposes only and does not constitute specific legal advice or create an attorney-client relationship. Readers should discuss their specific situation with an attorney.