Business Laws Entrepreneurs Need to Know

Starting a business is no small feat. Entrepreneurs must develop a profitable idea, create a business plan, hire a team, secure funding, and more in the process of launching a new venture. One of the most important things entrepreneurs must consider in the process is business laws. Both federal and local laws govern business operations, and if entrepreneurs aren’t careful, it’s easy to miss critical legal steps in the process. Below are some business laws all entrepreneurs need to be familiar with before starting a business.

Tax Codes

Tax codes are one of the first things entrepreneurs need to look into. Registering with the IRS and ensuring taxes are handled correctly is critical to every business’ operations. Entrepreneurs should be familiar with the different kinds of taxes: income tax, estimated tax, employment tax, and excise tax. Sales taxes are also a relevant consideration if you sell a product or service. Legal parameters may vary depending on the type of business, where you’re located, and other factors.

Intellectual Property

Patents, copyrights, trademarks, and trade secrets are also critical legal concepts to be aware of. If you are designing a new product, ensure it doesn’t violate existing patents or trademarks to avoid future legal battles. Additionally, consider protecting your original work by seeing if your products are eligible for their own patents.

Labor Laws

If hiring employees, you must know what labor laws your business must comply with. This includes minimum wages, hour restrictions, workplace safety, equal opportunity employment, and more. Ensuring your employees are treated fairly, and your employment practices comply with the law is critical. The Department of Labor has many helpful resources for business owners who want to learn about local laws and legal obligations.

Health Care Laws

Similarly, both federal and state laws regulate the provision of health care insurance for employees. The affordable care act and other regulations can help businesses provide affordable insurance for employees, but its applications vary depending on the number of employees. Look into programs like this and local requirements to ensure compliance and provide employees with the best possible health care.

Antitrust

Antitrust laws deal with matters such as conspiring to fix market prices, price discrimination, monopolization, and more. It’s important to avoid conspiring with competitors, third-party vendors, and other potentially relevant parties. The federal trade commission enforces these laws to prevent conspiracies that could unfairly affect the market and economy. While these laws might not often be relevant for startup entrepreneurs, they are still essential to be familiar with while interacting with other organizations.

Advertising

Advertising and marketing might seem straightforward, but there are critical laws and guidelines to be aware of. Being knowingly untruthful or deceptive is illegal and can lead to legal ramifications. These laws are also enforced by the Federal Trade Commission to keep industries from becoming corrupt and disrupting markets. Other regulations protect email and text recipients as well as the use of testimonials.

Privacy

Consumer privacy is also highly protected by Federal Trade Commission laws. If you handle any type of sensitive customer data, such as social security numbers or credit card payments, it’s critical to be aware of and comply with data privacy laws. PCI-DSS is a required certification for any payment processing system, so ensure your technology is compliant.

Navigating laws and regulations can be intimidating for entrepreneurs, but there are tons of resources available to help business owners access the necessary information to ensure they are compliant. Connecting with a legal professional is also a great way to evaluate your business plan and practices, ensure everything is in order, and follow all relevant laws and guidelines. Regardless, these are some of the key areas to be aware of and some of the most common legal challenges entrepreneurs might face.