What You “Don’t Know” Can Get You in SERIOUS Trouble
You follow the laws of the road, right? Stop at a stop sign. Never park in a handicapped parking spot. Yield to pedestrians.
What about when it comes to your business?
You can admit it. We’ve ALL skipped some steps we probably knew we should take. But what about the things that are actually REQUIRED?!
Why is it so hard for entrepreneurs to follow “the rules”?
Well, #1 – There is no permit or license to become an entrepreneur. No guide to follow, or test to see if you’re ready.
And #2 – Because there aren’t a lot of resources out there telling us the things we CAN’T or SHOULDN’T do as an entrereneur.
Lot’s of people want to tell you what you SHOULD do, though.
Grow an email list. Create a product. Run FB ads. Make a website. Post on social media. Ask for the sale.
And they’re quick to tell you the consequences of how you’ll fail if you don’t do these things.
But what about all the “unsexy” stuff you need to do for your business?
Like buying insurance. Talking to an attorney & CPA about your business entity set up. Checking for federal & state laws that apply to your business. Looking at your finances & “running the numbers”.
NO ONE is talking about this stuff! They all want to teach you how to make fast money now, but are likely LONG GONE when one of these situations happens to you (hey, it’s not their problem, right?).
And it’s a damn shame.
Because THIS is the stuff that can KILL your business, in an instant.
The IRS doesn’t care how big your email list is. If you don’t have your personal & business finances separated and someone sues you and wins? You could LOSE YOUR HOUSE. Most people are blissfully unaware of this fact.
This also means that if the IRS audited you for some reason, and decided you owe back taxes (like maybe you filed the wrong entity, or paid yourself incorrectly, or didn’t pay a tax because you “didn’t know” about it) you personally could end up owing them money. This could easily cause someone to go bankrupt, and lose their business all together.
The IRS also doesn’t play nice when it comes to employees (and neither do most states). It is up to YOU to know if the person you’ve hired is a W-2 employee, or a contractor. And the space between these two can sometimes be a bit of a gray area. You will also need to know the basic federal employment laws (minimum wage, discrimination, medical leave, workers comp, etc) and employment taxes.
And it’s not just the IRS you have to worry about!
There are numerous other areas of running a business that can get you in trouble.
Do you know your states law on Sales Tax? If you are an online entrepreneur, you are still required to collect sales tax from any sales made in your state. Now, most payment processors will take care of this for you, but for anyone processing their own payments this is something you NEED to know!
And how about the Advertising & Marketing laws? This one especially resonates, with the onslaught of courses & products everyone is selling online these days. You cannot make claims in an advertisement (eh ehm FB ads…) unless you have proof to back it up.
Also? There is a reason you have to give your subscribers the ability to “opt-out” of your email list. There is an actual law relating to commercial emailing, called the Can-Spam Act. Most violators won’t see legal action here, as that’s reserved for legit spammers, but you CAN get kicked out of your email service, and get your address/account blacklisted.
The list is endless (well, maybe not endless, but it’s pretty long) of things that can blindside you in your business.
Trademarking/Copyright Infringements? —> Get fined, Have to rebrand (i.e. start over), Ruin your reputation.
Skimpy Data Security? —> Get hacked (or identity fraud, file encryption), Lose your website, Get sued by customers.
Inadequate Insurance? —> No coverage for accidents, Loss of business (start over) Get sued by customers.
Incorrect Permits/Licenses? —> Get fined, Get closed down.
Improper Funding Campaigns? —> Ruin your reputation, Lawsuits from funders, Get fined by SEC.
Repurcussions from Bank Loans? —> Lose personal assets, Crash credit score, Bankrupcy.
ALL things you as a business owner NEED to be aware of, and take the necessary precautions against.
Because saying “Well I didn’t know that”, ain’t gonna cut it.