Business & Career Center

Small Business Guides: Tax & Legal Aspects of Starting your Business

small business banner

In a business start-up, there are various legal responsibilities you should be aware of so that you can protect your business and avoid costly penalties. Learning to file your own forms and keep your own records can help your business save money. Even if you intend to consult an attorney, you can reduce the cost of legal consulting by reading books or looking at websites that help guide you through the process.

Here are some considerations you may have regarding the legal aspects of starting or running a business. Listed are books, agencies, and links to websites that can give you information and assistance.

Finding a Lawyer

It is helpful to use a lawyer to set up the legal structure of your business, draw up employment contracts, close on real estate purchases, obtain patents or trademarks, and handle other transactions that involve large sums of money or binding agreements.

Before you consult a lawyer, you might look through one of the many books that outline the legal requirements involved in running a business. These books will help you gather the information and documents a lawyer may need to review. Or they may show you how to do simple transactions yourself. Check the Library Catalog for titles dealing with small business and law. If you decide to consult a lawyer, here are some helpful resources:

  • The Neighborhood Entrepreneur Law Project, also known as "NELP," offers free one-on-one legal assistance from a volunteer lawyer at its legal clinics as well as presentations on small business legal topics. Many of these legal clinics take place at the Central Library. You can call (212) 382-6633 or follow this link to find out more about NELP's upcoming events.  
  • The Brooklyn Law Incubator & Policy Clinic at Brooklyn Law School works with start up companies that have legal concerns that relate to new technologies, particularly internet and communications technologies. To apply for the BLIP clinic's services, send an email request to the email listed on BLIP's site, which is linked above.
  • The Martindale-Hubbell Law Directory, is a multi-volume directory of lawyers in the U.S., organized geographically by law firm, with an alphabetic listing of individual lawyers in the blue pages. The Business and Career Center only keeps the most recent version of the volume that contains entries for New York State behind the reference desk. This directory is also available online at If you use the "advanced search," you can search for individual lawyers or law firms by specialty and location.
  • Findlaw has a directory of lawyers and law firms that can be searched by location and specialty. You can also use the "advanced options" in the find a lawyer search to find lawyers with proficiency in a number of different languages. 
Selecting the Legal Structure of Your Business

There are several ways to legally structure your business. The three general legal classifications are sole proprietorship, partnership and corporation, and there are a number of things that you should consider before deciding on what structure is right for your business. Some of the important considerations are the number of people who will own the business, the personal liability of the owners, the tax advantages, and the simplicity, or complexity, involved in forming the entity.

A sole proprietorship is the simplest business entity to form. Forming a Partnership or s corporations is more involved and there are a number of variations for each, such as S Corporations and Limited Liability Corporations (L.L.C.). The Business and Career Center at the Central Library has several books that can help you determine the right structure for your business. Check the Library Catalog for legal guides to starting a small business. The Brooklyn Public Library also subscribes to a video tutorial website called that can also help you determine what legal structure is right for your business. Under the "Business" section of the "Library," there is a guide called "Starting a Business." Here you will be able to find videos about choosing your business structure.

A number of websites also have helpful guides for selecting the form of your company:

  • Findlaw's Small Business site has a good explanation of "Incorporation, "Legal Structures", and "Business Formation."
  • Harbor Business Compliance provides a comprehensive guide on how to start a business in New York.
  • Business Filings Incorporated has a comparison table that outlines the characteristics of different legal business structures.
  • NYC Business Solution's Business Library has several useful handouts and guides for small business owners and aspiring entrepreneurs, including how to structure your business. These handouts and guides are also available in a number of different languages.
Registering a Business

Once you have selected a legal structure for you business, you need to make sure that you file with the right government entity. If you are incorporating, you might have a lawyer help you with this. You could also refer to the books and eBooks about incorporating a business to help guide you through the process by searching the Library Catalog for keywords such as "LLC" or "incorporating." You may also want to schedule an appointment with a SCORE counselor at the Central Library to make sure that all of the paperwork is filled out correctly.

Even if you do not intend to incorporate, but still would like to do business using a name other than your own, you need to register your business. The form to file, Form X-201, is referred to as a "DBA" (doing business as) and it must be filed with the county clerk. In Brooklyn (Kings County) the county clerk is in the State Supreme Court Building at 360 Adams Street, RM 189, Brooklyn, NY 11201, 347.404.9750.

Here are some links that will help you through this process: 


Licenses and Regulations Needed to Operate a Business

Almost every business requires a license of some sort, and some may require more than one. You may also need a professional license or accreditation for yourself or your employees, depending on your field (e.g., beauticians, electricians and other professionals need to be personally licensed).

The State and City of New York, as well as the federal government, issue licenses and permits. For example, an employment agency needs a license from the New York City Consumers Affairs Department, a restaurant needs a permit from the NYC Department of Health and needs to comply with a number of other regulations from other departments, such as the NYC Department of Energy, and a real estate broker is licensed by New York State. Luckily, the city government has a few resources that can help your business navigate all of these governmental regulations.

NYC Business Express is a website that was created by NYC Small Business Services to be a one-stop-shop for determining the federal, state, and municipal licenses, permits, and inspections that you need to run your business. In addition to listing which licenses,permits, and inspections that you will need, this site will also provide information about the necessary steps to acquire each license or permit or comply with each regulation as well as the appropriate contact information for the issuing authority. The "EasyStart" and "Starter Guide" links answer these questions for the most common industries, but you can also answer a series of questions using "NYC Business Wizard" to find out exactly which licenses and permits are required for your business.

NYC Business Acceleration is a department that was created by the NYC Small Business Services to help brick and mortar businesses streamline all of the permits and inspections that they need to open for business. If you are an industrial, retail, or food and beverage establishment, you can get a free client manager who can coordinate all of your inspections so that you can open your doors as soon as possible.
Filing Taxes

Every business must pay income tax on its profits, but there are other tax liabilities that you should be aware of when you are starting out. Good record keeping and bookkeeping are invaluable, and these practices can save you time and money. There are also several ways to reduce your tax burden, including deducting business expenses, and you may want to consult a bookkeeper or an accountant regularly to make sure you are maximizing these opportunities. There are, of course, several books and eBooks that outline ways to save on your business's taxes. You can find these books in the Library Catalog using a keyword search for "small business tax" or "small business taxes."

The library also subscribes to a video tutorial database called There are several video courses on "bookkeeping" and "accounting" that can by found using a keyword search. You can scroll through the contents of these courses to look for the sections that concern business taxes. The departments of the city, the state, and the federal government that handle taxation also usually have valuable information concerning your business's taxes on their websites.

NEW YORK CITY TAXES: A sole proprietor or partnership in NYC must pay an Unincorporated Business Tax, while corporations pay a General Corporation Tax (GCT). Other examples of taxes imposed by NYC are sales tax, commercial rent or real estate tax, and alcoholic beverage sales tax. A good list of NYC business taxes can be found on New York City's Department of Finance website.

NEW YORK STATE TAXES: If you are selling goods, it is mandatory that an application be made for a Certificate of Authority (Resale Certificate). Use form DTF-17, Publication 750. You can apply online, at New York State Dept. of Taxation and Finance or get copies of the forms you need.

FEDERAL TAXES: In general, a business must pay federal taxes on its income and you must also pay self-employment tax on the income you receive from your business. In addition, there are tax obligations related to your employees. Every business should obtain a Federal ID number (Employer Identification Number or EIN) by filling out IRS Form SS-4. Use the IRS Tax Information for Businesses site to get an explanation of this and other federal taxes. To get copies of the tax forms, click on "Forms and Publications."  For more information online you can use the IRS Small Business and Self-Employed One-Stop Resource or watch videos about small business taxes in the IRS Video Portal.

Writing Contracts

You will find that you need to record many business transactions and agreements. You may want to draw up an employee contract, a bill of sale, a rental agreement or any number of documents. There are many standard forms and contracts that can be adapted to suit your particular needs.

Books with sample forms can be found by checking the Library Catalog for using keywords such as "business contracts" or "business legal forms." You should still consult an attorney and an accountant in many instances, but these standard forms can be a starting place; in many cases they will allow you to complete a transaction yourself.

Websites also offer information or sample forms online, sometimes for a fee:

Applying for Patents, Trademarks or Copyrights

A trademark is a word, phrase, symbol, or a combination of words and symbols that identifies your product or your company. A patent is granted to an inventor to exclude others from making, using, or selling his or her invention. Copyright is used to protect the rights of creative works, such as books and songs. Applications for Copyright are handled by the U.S. Copyright Office, and applications for both patents and trademarks are submitted to the U.S. Patent and Trademark Office. You can conduct patent and trademark searches to see if your idea has not been patented or trademarked without an attorney, but it is extremely beneficial to consult an attorney who specializes in intellectual property before you apply for a patent or trademark.

To learn the basics, start with one of the books or eBooks devoted to these topics. You can find these items by searching the Library Catalog for using "patent" or "trademark" as keywords. Another essential source is the U.S. Patent and Trademark Office. Additionally FindLaw and have information on their sites listed under "Intellectual Property."

If you wanted to conduct a patent or trademark search yourself, you may want to consult the New York Public Library's Science Business and Industry Library at 188 Madison Avenue at 34th Street in Manhattan, 212-592-7000. They are a Patent and Trademark Resource Center and would be able to assist you with this process. If you wish to copyright a song, book, play or other creative work, the applications are handled by the U.S. Copyright Office.

Other Small Business Guides: