Mistakes California Business Owners Should Avoid
Aug 18 2021 0

The Biggest Mistakes that California Business Owners Should Avoid

Unless you are an experienced entrepreneur with a history of successfully starting up various new enterprises in California, it is likely that you could use some help if you want to open a new organization. Whether you are interested in starting a small business, a non-profit, or another type of startup, it is likely that you will experience some bumps along the way. 

While having a detailed business plan before you embark on starting a new company or organization is helpful, you never know what obstacles or issues could arise down the road. If you talk to any veteran entrepreneur they will tell you that facing challenges while you are building your business is going to happen. Doing your research before your start to get an idea of what issues could come up and how to manage them is key. Working with a California business attorney is also a step in the right direction. A qualified Los Angeles, California business attorney will be able to answer your questions, offer you effective legal guidance, and help you more smoothly manage your start-up.

What Pitfalls Should New Entrepreneurs in California Be Know About?

Mistakes California Business Owners Should AvoidIt is necessary for all business owners and non-profits to maintain their status with the California Secretary of State’s Office. Failure to do this limits a business’s ability to function legally in the state. For example, when the proper status isn’t kept up, a business will not be able to sign contracts or even defend against lawsuits brought against them. Depending on the situation, it isn’t just an inability to run one’s business that can happen, but criminal repercussions can also result. 

A domestic company that had its operations suspended by the Franchise Tax Board will not be able to legally sign off on any type of contract. Further, if the company is facing legal challenges, it will not be able to defend itself against them.

Companies that are formed outside of California but do business in the state must also register with the SOS. These companies that do not register, don’t pay their yearly franchise tax or do not pay their income taxes mean that they will be unable to legally function in California. If a legal suit is filed against a disqualified company, they will not be able to protect themselves and will likely have a judgment handed down against them.

Operating your suspended business in California can come with misdemeanor criminal charges. So instead of taking any chances with how you run your business when it has been suspended, ensure that it is in good standing first. It is possible to revive a suspended business and get back to things in a legally viable way. A talented and experienced Los Angeles business attorney can advise you on what to do to accomplish this.

Speak to a California Business Attorney Today

To avoid expensive and even criminal setbacks, work with a Los Angeles business lawyer at Leiva Law. You can schedule a free consultation with the California business attorneys at Leiva Law today by calling (818) 519-4465.

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