Since I’m a sole owner of a business, if in the future I may want to add an owner to the company do I need an attorney to incorporate?

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Since I’m a sole owner of a business, if in the future I may want to add an owner to the company do I need an attorney to incorporate?

Asked on January 2, 2013 under Business Law, California

Answers:

B.H.F., Member, Texas State Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

You are not required to have an attorney to incorporate.  There are several online companies that essential offer "corporations in a box," and can complete all the required paperwork to get your business incorporated.  These companies are usually quick and very inexpensive.  Where things get expensive is on the back end.... if you decide to add an owner to the company and you and the new owner later decide to split, the standard forms used by the quickie incorporation company may not be sufficient to help you dissolve the company in a way that's fair or useful to either one you.  For example, many of these cookie cutter forms require the company to be sold and the proceeds split between the two owners-- even though one owner may want to keep the company.   An attorney can help you incorporate, preplan expansion, and draft a plan for dissolution in the event that the new owner does not work out.  You may want to have a clause that allows you to "buy out" the new owner, so that you can still keep your business.  In this economy, starting a new business is a challenge and an accomplishment.  A good corporate attorney can insure that you get to keep your company down the road by minimizing the potholes.


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