Starting a business in Florida, although exciting, comes with a fair amount of complexities. Learning the basic concepts is a good place to start.
What is a Limited Liability Company or LLC?
A Limited Liability Company is a type of business structure that combines the limited liability of a corporation with the “pass-through” taxation of a sole proprietorship. LLCs are taxed like sole proprietorships, in which sole proprietors must report profits and losses on their personal tax returns, as the LLC is not considered a separate entity. However, the owner of an LLC cannot be held liable for debts like a sole proprietor may be, as LLCs come with a “corporate shelter.” This shelter is not, however, absolute; if the owner of an LLC commits an act that is negligent, or worse, illegal, then that person can and will be held liable.
What is a Corporation?
A corporation is a business structure that is considered a legally independent entity. This essentially means that a corporation is legally separate from the people who own it, control it, and manage it. Tax and corporate law view corporations as pseudo-persons that can be taxed, incur losses and gains, and enter into agreements and contracts. A key benefit of corporations is that they also shield the people who own, control and manage this type of companies from personal liability. This essentially means that in the event a corporation incurs a judgment against itself, the personal assets of the owners will be protected.
What exactly is a Statutory Agent?
If you own a business in the United States, you are required to have a registered agent or statutory agent that must be designated to receive service of process. “Service of process” is, essentially, the notification process that takes place when a business is a party involved in a legal action. While most business entities, like corporations, are viewed as pseudo-individuals under Florida law, process cannot be served to a business. This is why the business must choose an agent to receive service in order for the claim to be able to move forward in court.
What Organizational Structure Should I Choose for my Business?
When choosing an organizational structure for your business in Florida, there are five main points you will need to consider as well as other considerations that are specific to your unique case. The five main points you need to consider first are:
- Capitalization of the business.
- Tax preferences.
- Whether you plan to issue and trade stock.
- The management structure of the company.
- Personal liability.
However, because every business is different, they all have unique needs that need to be considered when choosing the right business structure in Florida. Hiring a skilled and experienced Business Lawyer at this point can be of great help in landing on the right choice.
What is the Difference between Copyrights, Trademarks, and Patents?
All three of these devices are intellectual property protection systems; however, each serves a specific purpose.
Copyrights protect “original works of authorship.” However, copyrights do not protect the subject matter the way a trademark or patent would. For example, a copyright would protect the picture or the description of a specific ice cream flavor, but it would not prohibit others from making a similar flavor of ice cream.
Trademarks are developed to protect the words, phrases, logos, and symbols a company uses on its products and services to differentiate them from those of other companies. This prevents other companies from using similar words, phrases, logos or symbols that might create confusion in the sale of their products and services. For example, if a company uses a penguin to advertise its ice cream brand, a trademark would prevent other companies from using a penguin to advertise their ice cream in a similar way. However, unlike a patent, a trademark would not prevent other companies from selling a product that is similar to yours.
Patents are granted to “inventors” and are issued by the U.S. Patent and Trademark Office. A patent is typically valid for 20 years from the date of the application. Continuing with the examples above, a patent would prevent other companies from making your special ice cream flavor because it is your creation and it is recognized as such by the United States. Only you would be able to make and sell that ice cream flavor unless you specifically sell your patent rights to another company.
Do I Need to Hire a Business Lawyer to Start a Business in Florida?
Some would tell you that it is not required by law – and it is true. That, however, does not mean you should not hire a Lawyer to help you start your business in Florida. The help of an experienced and skilled Florida Business Lawyer is crucial. Hiring a qualified lawyer is the very first thing you need to do in order to make your way into the business world.
If you are looking to start a business in Florida, contact me, Business Lawyer Romy B. Jurado by sending me an email to Romy@juradolawfirm.com. From choosing the right business structure and legally forming your business to protecting your intellectual property and serving as your legal representative, I will be there to help you throughout the entire process of starting a new business – from formation to success.