Starting a business in Pittsburgh can be an exciting venture, but many things need to be considered. Understanding the local legal landscape is crucial to your success, among other things. This involves being knowledgeable about city-specific regulations, choosing the right business structure, and ensuring compliance with tax obligations.
Key Steps And Considerations For The Set Up Of A Business
1) Choosing the Right Business Structure
One of the first legal considerations is deciding on the type of business entity to establish. Your chosen structure affects your liability, tax obligations, and operational complexity. Common structures include:
- Sole Proprietorship: This is the simplest business form, with no distinction between the business and owner.
- Partnership: This type of entity involves two or more people who agree to share a business’s profits and losses.
- Limited Liability Company (LLC): The limited liability company offers protection to its owners with less formality than a corporation.
- Corporation (C Corp or S Corp): The C Corp or S Corp is more complex and suitable for businesses that plan to go public or seek investments.
2) Registering Your Business
After choosing your structure, you must register your business with the Pennsylvania Department of State, which involves the following:
- Naming Your Business: Ensure the name is unique and complies with Pennsylvania’s business name requirements.
- Registration Documents: File the necessary documents, such as Articles of Incorporation (for corporations) or Articles of Organization (for LLCs).
- Obtaining an EIN: Secure an Employer Identification Number from the IRS for tax purposes.
3) Zoning and Licensing
Check Pittsburgh’s zoning laws to ensure your business location is zoned for your type of business. Depending on your business type, you may need specific licenses or permits from the city or county. For example, a General Business License is required to operate a business within Pittsburgh. Certain businesses, like restaurants or bars, need additional special permits related to health, safety, and the environment.
4) Employment Laws
If you plan to hire employees, comply with federal and state employment laws. You will be required to follow wage and hour laws, including minimum wage requirements. Occupational, Safety, and Health Administration (OSHA) regulations must be followed to ensure a safe work environment. Abide by laws that prohibit discrimination and provide equal opportunity.
5) Contracts and Agreements
Drafting legally sound contracts and agreements is crucial. For businesses providing services, outline the scope of work, payment terms, and dispute resolution. You will need employee contracts detailing employment terms, benefits, and confidentiality agreements. In addition, if renting a business space, it is important to have a clear lease that specifies rent, duration, and tenant/landlord obligations.
6) Intellectual Property Protection
Protect any intellectual property (IP) that is critical to your business. You will be required to register trademarks to protect brand names and logos. If you have an invention, consider patenting it to prevent others from making, using, or selling it. Lastly, you might need copyrights for original works of authorship like books, software, and art.
7) Tax Obligations
Understand your tax obligations to avoid penalties. For example, depending on your business structure, you may be subject to various taxes, like income and self-employment taxes. In addition, Pittsburgh may require specific taxes related to business operations.
8) Legal Advice
Consider consulting with a business attorney to assist with complex legal matters and provide ongoing legal support. A local Pittsburgh attorney can be invaluable.
Contact a Business Law Attorney in Pittsburgh
Starting a business in Pittsburgh involves careful planning and compliance with specific legal requirements. By thoroughly understanding each step and seeking the proper support, you can establish a strong foundation for your business’s future success. Jones Gregg Creehan & Gerace has experienced attorneys who can also provide guidance and help smooth the process when forming your own business. Contact our office for an initial consultation.