Episode 010: Stop Paying for Bullshit

other legal solo show Nov 07, 2019

On this episode, I discuss what is a waste of money when it comes to legal needs for your business and where it’s ok to DIY.

Check out the free EIN video tutorial here.

Episode Transcript

Braden: (00:01)
Hello and welcome to episode 10 of the unfuck your business podcast. I'm your host Braden. Super excited to have you here. This is going to be a relatively short episode titled stop paying for bullshit and we are going to help walk through some expenditures I've seen small business owners make that are totally unnecessary. That's probably the best way for me to put it, but before we dive in, I just want to remind you all that I have a few small business legal masterclasses coming up on November 20th and November 22nd that's a Wednesday and a Friday. We're going to talk about the layers of legal protection for your business, how to get started with LLCs, whether you really need one. I had a form it and the different licenses you need and then we will wrap up with a Q and a. So if you want to check that out, just go to the website unfuck your biz.com and you can click the masterclass button to get signed up.

Braden: (00:57)
I would love to see you there. So without any further ado, let's dive in. I got the idea for this podcast back during tax season when I had a few sit down meetings with small business creatives, I was looking through their bookkeeping and saw some, what I thought at the time were suspicious line items for charges. I ask, what is this? They said they didn't really know. So I called the respective companies with the charges to ask what they were because they were basically competing products to what I offer and my online business and in my law firms. So on top of wanting to help the client with the tax return, I was also just generally curious. So one of the charges I found was for annual register agent services and the amount of $300 if you don't know what that means, don't worry, I'm going to explain it to you.

Braden: (01:49)
When ever you are sued by a client or by anyone, they file a document with the court called a complaint and the complaint is a formal legal document that lays out what they're suing you for and States the facts of whatever it is to happen that they're now upset about. They have to deliver that complaint to you so that you are notified that the lawsuit is happening. That gives you time to defend yourself and makes you aware of what you're being sued for. So we call that service a process. If you seen service processors in movies, it's pretty common. You know what I'm talking about, but your registered agent is the person who's responsible for receiving service. The process of that complaint for you, you can be your own registered agent. A lot of people choose not to because they don't want their home address listed with the state when it comes to those registered native services, that makes them feel uncomfortable.

Braden: (02:44)
So they will get what is called a corporate registered agent. Basically a third party company who is responsible for receiving that service or process and then notifying you that you have been served. So they give you the legal documents. The reason why I was surprised by this $300 charge is a, because you can't do it on your own if you want to, but in the state of California, you can get a registered corporate agent for $50 a year. And in most States it's the same amount of money. So 300 is a lot. I mean that's what, six times the amount of money if I'm doing correct math. And really there's no additional benefit to paying that money. Like the service is super simple. They collect documents, they notify you, that's it. So that seems pretty extreme. So I don't recommend paying that much money for a service of process.

Braden: (03:36)
If you do form an LLC and don't want to serve as your own agent, just Google corporate registered agents and click on a few CPL, like their vibe. Um, a lot of them are gonna have super modern websites. If they do, that's a bonus, but just make sure that they're gonna do what they need to do and don't charge you an arm and a leg. Another line item that I thought was interesting was an $80 charge to another. Actually the same online service for an EIN. If you don't know what an EIN is, that stands for employment identification number. I explain it as your businesses social security number. It's an identifying number for your business. Oftentimes you will see on legal documents they will ask for a tin, T I. N. that stands for tax payer identification number and when they ask for your 10 what they're really saying is please put either your social security number here or your businesses EIN.

Braden: (04:40)
You can put either and when you have an EIN it saves you from having to give your social, which is an obvious benefit for privacy reasons. The most common place where this is necessary is on w nines so if you don't know what that is, when you do work for another business and they need to send you a 10 99 they'll first ask you to fill out a w nine to get your necessary information, one of the blanks on their ass for your 10 have. You don't have an EIN for your business. You have to give them your social security number. I personally am not someone who is super concerned about privacy, so it doesn't bother me too much. Some people feel much differently about that. But the great thing about [inaudible] is that they are absolutely free to get, they take about five minutes, you don't have to pay anything.

Braden: (05:26)
So I tell everyone to get an EIN for their business. They're also required, once you go to open a business bank account, so you might already have one. You can get the EIN for free through the IRS website. It's gonna ask you your name, your business name, your address, a few other basic pieces of information, and that's about it. Then you can select to get the EIN electronically. You don't need to get it mailed to you. It'll just pull right up in a PDF document. So what really kind of pisses me off is when online services charge for this, because what they're actually doing is they're asking you all the same questions that's on that free IRS form, but then they're going to take that information and then transpose it onto the IRS form. So it's not really saving you any time. It's not making it any easy, easy or they're charging you for whatever reason to do that, so don't pay to get your EIN.

Braden: (06:21)
That's the short story. If you want help with your EIN. Again, I always do myself a disservice when it comes to this kind of sales stuff, but I have a free tutorial like you don't even really need to go watch it. It really is that easy to do on your own. But if you're going through the process to get your EIN and you're uncomfortable with a few of the questions, you're just not sure what to answer. Go check out my freebie. You can find it in the show notes, unfuck your biz.com forward slash episode forward slash zero one zero for episode 10 and you can watch my free tutorial where I'd go through step-by-step all the questions on the EIN application and show you how to answer it. So that's super easy. Now, some other areas where I'm going to recommend you not paying for bullshit our contracts.

Braden: (07:08)
I actually am a proponent of contract templates and template stores, but with some caveats they need to be specific to your industry. So don't go to these websites where they have general client service agreements that are made for literally everyone. You know, photography business is very different from a hair salon, which is different from a construction company. You know, if you're a general contractor, you shouldn't be using the same contract as a floral designer or graphic designer. You have very different businesses, different needs. You're going to have copyright issues. They're not going to have, they're going to have shit that I don't even know about, which brings me to the other point. The person who drafted that contract should understand your business. I draft contracts for creatives, not people in the construction industry. I don't understand their business. So it would be difficult for me to draft that contract.

Braden: (08:00)
I get your business. Therefore I have solid templates that I offer on my website for small business creatives. So my tip here is just make sure that the contract is for your industry and covers what you need. And then also, um, see if you could find one that was drafted according to your state. So if you have very general needs, it doesn't really make a difference. You can get a template and then if you need to make updates, you can work with an attorney in your state to customize that contract. Some more conservative attorneys will disagree with me on this and say that you should always work with an attorney in your state. We're always going to tell you to do that as a safety precaution. But if you have very general needs, a good solid template is probably fine. So other areas, uh, your EIN I already mentioned is free.

Braden: (08:49)
The LLC, kinda like the EIN. I don't recommend that you use an online filing to do your LLC because you can file it through most state websites for free. It's easy to do. You don't need a pay someone else to file it online for you. My tip is if you were going to use an online service to do it, you might as well just DIY it because it's cheaper and it's not any more difficult. But, uh, I offer a course on your LLC, which covers all of the shit that's not covered by those filing services. So when you have an LLC, you want to be strategic about when you should Uplevel that to an escort, when's the right time to do that? How to do it correctly so that you get the benefits and the tax savings. You need an operating agreement and meeting minutes and to be properly advised on your business bank account because all of those things are necessary in order to maintain the liability protection provided by your LLC.

Braden: (09:50)
And most online services do not provide all of that. So I, of course, I'm very biased. Like I just said, I offer a course called legally launched and unfuck your business on how to do that stuff. Um, so you could do that. The third option is obviously to hire a professional work with an attorney to do it for you. So this is kind of, um, what's the word I'm looking for? Cost benefit analysis. How busy are you? Do you want to do it on your own? So this is my recommendation. If you want to DIY your LLC, it's fine. Just make sure that you get all of the licenses you need. And then I would recommend buying a solid operating agreement template from an attorney. I have one on my website. The next step up from that is to take a the course which walks you through all the steps and in the masterclass I mentioned at the beginning of the episode, I'm going to be telling you more about the course at the end.

Braden: (10:46)
So if you're interested in learning about it, come to the masterclass. And then the third option is to hire a professional. If you're in California, I'd love to work with you. If not, you can still shoot me a message and I know several attorneys throughout the country so I might have a contact in your state. The last topic, our trademarks do not do not pay for an online trademark service. It's not worth it. I don't do trademarks, but I have several friends who do trademarks and they all tell me that they work with so many clients who use online filing services for trademarks. And then ended up paying them even more money than they originally would have to untangle the mess that it creates. If you have more questions about this in a few episodes, I don't even really know when but several episodes for now.

Braden: (11:35)
I'm going to bring on a trademark attorney to kind of talk about the nuts and bolts of this, but my general guidances trademarks are very complex. It's a nuanced area of the law. You should work with a trademark professional once you're ready to get some intellectual property protection for your, the last area is anything partnership related. So partnership law is tricky as well. Partnership agreements can be quite complex. If you enter into a business with a partner, talk to an attorney, I'll leave it there and not get too into the weeds, but I hope this was helpful. I don't want any of you to think that you need to hire an attorney for everything. I also don't want to completely shit on like every online service out there, but there are some, some services that are good for certain things and then not so much for other things. And I wanted to kind of do a broad overview of that on this episode. So again, the masterclasses are the 20th and 22nd I would love to see you there. Go to my website to get signed up, shoot me a DM. If you have any questions, don't forget to subscribe and leave a review and I look forward to podcasting with you again in a few days. I've got one.

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