table of contents

​​Leah Martin Law

• Starting a Sole Proprietor Ship: the Benefits and Concerns
• The Benefits and Risks of Business Partnerships

Moss Berg Injury Lawyers 

• Who Is Liable When You Loan Your Car to Someone Who Has an Accident?​​​

 

​The Benefits and Liabilities of Sole Proprietorships
Meta Title: The Benefits and Liabilities of Sole Proprietorships
Meta Description: Learn the benefits and issues involved in operating a sole proprietorship. Understand how the business will effect your life and finances.
Meta Keywords: business legal structures, sole proprietorship, business ownership, advantages and disadvantages of sole proprietorships
Summary: Owners of sole proprietorships keep all the profits and take all the credit for their business' success, but they also do all of the work and assume all of the liability.
Starting a Sole Proprietorship: the Benefits and Concerns
It is important to understand how a sole proprietorship effects your life and your finances. A business formation lawyer can guide you through the details, but below are some issues and rewards to consider.
Financial Considerations
One attractive reward is that you keep all of the profits for yourself. However, you must pay your income taxes, your Medicare payment, and both your own share and the employer's share of your Social Security payment. If you have employees or work with freelancers or consultants, you must complete all of the relevant paperwork and withhold your employee's taxes.

Another concern is that there is no distinction between your personal and business income and property. If you suffer a business or personal financial loss or someone sues either you or your business, the court can use both your personal and business assets as resources to pay either personal or business debts and settlements.

Finally, if you should die, the business cannot continue as it was before your death, and it may lose value upon your death. Therefore, you should specify in advance whether the business should be closed, transferred to a new qualified owner, or sold. Estate and inheritance taxes can be significant if ownership is transferred through a will, so explore estate planning alternatives with a lawyer specializing in business formation.
Operational Considerations
Financial considerations aside, sole proprietorships provide independence and personal satisfaction. Hours and prices may be dictated by location for brick-and-mortar businesses, but the internet gives service providers greater freedom in setting rates and work hours. You are responsible for marketing and growing your business, but credit for the growth goes to you. Of course, credit for failures also goes to you, but you gain knowledge from failure.
Making the Choice
Even with the responsibilities and liabilities, sole proprietorships offer many offsetting rewards.​

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​The Benefits and Risks of Business Partnerships
Meta Title: The Benefits and Risks of Business Partnerships
Meta Description: This article discusses benefits and advantages of business partnerships and issues of compatibility between business partners.
Meta keywords: business partnerships, benefits of business partnerships, risks of business partnerships, starting a business partnership
Summary: Before starting a business partnership, consider whether you and your partner are compatible with each other, and whether you are both compatible with a business partnership.
Is a Business Partnership the Right Choice for Your Business?
When you are starting a new business, the responsibilities of a sole proprietorship and the legal requirements of a corporation may sound daunting. A partnership may seem like the solution. However, there are a several issues to consider.
Traits of Good Business Partners
To work together successfully, you and your business partner need to communicate before making decisions, and you need to be able to agree on compromises. Just as communication is important, so is trust, having similar values and a similar vision, and having a similar level of commitment and attitude toward doing the work required to make the business a success. 
The Advantages of a Partnership
Partnerships offer benefits that can help the business survive in situations where a sole proprietorship might fail or never get started. Both partners contribute to the start-up costs and operating expenses. Ideally, you and your partner also will bring varying but complimentary skill sets and experience to the business as well as a varied list of business contacts. In addition, you each share the work and responsibilities, and together you can motivate and support each other.
The Disadvantages of a Partnership
​You and your partner will share every decision. When you disagree, you will need to compromise or have the grace to admit that the other is right and defer on that issue.

When partners cannot agree, one may give up on the business and sell out to the other, or the business may be dissolved. In addition, profits are shared, and, depending on the resources each partner brings to the business, they may not be split evenly. Further, if your partner reneges on his or her share of the operating costs, you become liable for those expenses, and a partnership does not protect the personal financial assets of the partners as a corporation does.

In addition, if your partner’s actions damage the reputation of the business, that can affect your business and personal reputation as well.

Having a business law attorney draw up the partnership agreement can mitigate some of these issues.

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Moss Berg Injury Lawyers

Who Is Liable When You Loan Your Car to Someone Who Has an Accident?
It is so common for people to loan their cars to a trusted friend, neighbor, or close relative that you may not even pause to think about it when you toss over the keys. Why not? Their car is in the shop or their son, daughter, husband, or wife has their car. They just need to run a quick errand. You're busy. It's just easier to hand over the keys than to stop what you're doing and take the time to drive them where they need to go.

What could go wrong?

They leave with your car, and then, fifteen or twenty minutes later, you get the call. They are so sorry. They had an accident.

Who is liable? You should consult a personal injury lawyer, of course, but several factors are used to determine liability.
Residency
If you loaned your car to someone who lives with you, even if that person is a roommate and not a relative, that person may be considered a member of your household and might be covered by your insurance.

However, if you loaned your car to a relative who lives out of state but who is staying with you for a visit, that person may not be considered a member of your household even though he or she is related to you. To clarify the situation, it might be wise to add a roommate to your insurance policy if you think you might ever toss them the keys.
Permission
If you give someone permission to use your car, you are liable and any accident claims will go against your insurance. However, if someone steals your car or drives it without your permission, you are free of any responsibility.
Insurance Exclusions
Just as you can add relatives, friends, neighbors, and roommates to your policy if they might drive your car, you can remove or exclude someone from your policy if you think that you will no longer allow them to drive your car. If someone you've excluded from your policy later drives your car with your permission and has an accident, your insurance may not cover them, and you may be liable.
Fault
If the person driving your car isn't the one who caused the accident, then the other person is liable, and all claims will go against that person's insurance.
Policy Limits
In the case of a severe accident, the claims can exceed the amount that your policy will pay. If the person who was driving your car has insurance that covers driving a borrowed car, that person's insurance may fill the gap between the total claims and what your insurance will pay. 
The Best Policy
The best policy is to carefully read your insurance policy to see who and what is covered before you loan your car.