The Legalities

The Legal Issues Your Small Business and Non-profit Should Be Aware Of Presented by: Erin McClarty Esq.

When Legal Issues Can Arise
Incorporation General Operation Issues Advertising/ Transactions Labor Trademarks/Intellectual Property Dissolution/ Winding Down

Choosing A For-profit Structure
Sole Proprietorship
One person doing business Liable for all debts

General Partnership
Group of two or more carrying on all business.

Limited Partnership
General partners have liability. Limited partners liability limited to their share.

Choosing A For-Profit Structure
Corporation Limited Liability Company Limited Liability Partnership

Choosing a Non-profit Structure
Trusts

• • • •

Created by a settlor Very rigid in structure

Unincorporated Association
3 or more people come together for a common non-profit purpose Less formality and fewer reporting requirements than a corporation

Choosing a Non-profit Structure

Limited Liability Company Corporations

Telephone Solicitations
Telephone Consumer Protection Act Texas Law Enforcement Telephone Solicitation Act Must file a registration statement and pay fee.

Websites
Privacy Concerns

• • •

Have a privacy policy in place

Internet Regulations
Children’s Online Policy Protection (COPPA)

Jurisdictional Issues
Post “Terms of Use” on your website

E-commerce

Email
Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (CAN-SPAM) Governs “commercial mail”

Other Texas Laws

Criminal and civl offenses for fraud or misrepresentation Example: Texas Deceptive Trade Practice Act

Operations
Insurance Worker’s Compensation General Liability Licenses and Permits
Does your business require a certain license?

Labor
Managing Employees Create an employment agreement include a confidentiality agreement

Employee v. Independent Contractor
Classification is a hot-button issue Avoid employee problems and many taxes using independent contractors. Several Factors to determine who is an IC Determination of Worker Status (IRS Form SS-8) Texas workforce commission also has a test at http:// www.twc.state.tx.us/news/efte/ics_contract_labor.html IC’s make you more susceptible to IRS audits

Labor Laws
Fair Labor Standards Act (FLSA) Department of Labor has a handbook for guidance: www.dol.gov/asp/programs/handbook/main.htm Family Medical Leave Act (FMLA) Texas Labor Code

Non-profit Issues
Charitable Solicitation Laws
May require registration in each state you plan to solicit in Fill out Uniform Statement Kit at www.multistatefiling.org Losing tax-exemption status Unrelated Business Income Activies 1. Trade or business; 2. Regularly carried on; 3. Not substantially related to furthering the exempt purpose. IRS Publication 557 Tax-Exempt Status for Your Organization gives guidance

How Can You Protect Yourself
Educate yourself on all the applicable laws
Sign up for department RSS feeds and newsletters Take how-to books with a grain of salt

Get together your “team”
Bring in knowledgeable people Get what you pay for

Utilize development centers, groups and associations Look for “Meet-ups” and Networking Groups

Why Do I Need An Attorney?
Guidance and Counsel
Sound-board

Can’t know every law
Draft or review contracts

Pre-emptive action and mitigation Advocate and representative in case of business transactions
mediation, mergers, negotiations

But I can’t afford one…..
Be Creative Some attorneys allow you to buy “credits” Do package deals Hire counsel on a contract basis

Attorney Resources
Houston Volunteer Lawyers Program S.C.O.R.E Houston Lawyers Referral Service Texas Accountants and Lawyers for the Arts Texas C-bar

Contact
Erin McClarty Esq. erinemcclarty@gmail.com www.notationsonnonprofit.com

Master your semester with Scribd & The New York Times

Special offer for students: Only $4.99/month.

Master your semester with Scribd & The New York Times

Cancel anytime.