legal-essentials
SKILL.md
Legal Essentials
Overview
Legal issues aren't sexy, but they protect your business and personal assets. Most solopreneurs ignore legal until it's too late — then one lawsuit or contract dispute wipes them out. This playbook covers the absolute essentials: business structure, contracts, IP protection, and liability. Disclaimer: This is educational content, not legal advice. Consult a lawyer for your specific situation.
Step 1: Choose Your Business Structure
Your business structure affects taxes, liability, and paperwork. Pick the right one from day one.
Structure comparison (U.S.):
| Structure | Liability Protection | Tax Treatment | Complexity | Best For |
|---|---|---|---|---|
| Sole Proprietorship | ❌ None (personal assets at risk) | Pass-through (report on personal tax) | Very Low | Testing an idea, no risk |
| LLC (Single-member) | ✅ Yes (separates personal/business) | Pass-through (default) | Low-Medium | Most solopreneurs |
| LLC (Multi-member) | ✅ Yes | Pass-through (partnership) | Medium | Partnerships |
| S-Corp | ✅ Yes | Pass-through (with payroll requirements) | Medium-High | Higher revenue ($100K+ profit) |