Trick Or Treat? Scary Government Regulations Every Business Must Know

By Kelly Bagla, Esq.

No matter what type of business you run, you must comply with federal, state and local statues and regulations administered by legislative bodies and carried out by regulatory agencies. Some regulations impact the way in which businesses report income and pay taxes, others regulate how they dispose of their excess materials or waste. For just about any kind of industry and transaction there are government regulations on business. The sheer volume of government regulations on business can make your head spin, whether or not you are just starting out or are a seasoned small business owner. But despite the high volume of government regulations on business, understanding the general rules is not actually as scary as it sounds.

Here are some common kinds of government regulations on business:

TAXES

For most small business owners, government regulation questions almost always begin with taxes. But there is more to taxes than merely paying them – knowing which business taxes to pay, when to pay them, and how to setup your business to account for future tax payments can spare you a ton of headaches when it comes time to write the government a check.

Every company registered within the United States has to pay federal taxes. Most companies will also have to pay state taxes, depending on the state in which the company is registered. But the kind of taxes you’ll pay depends on how you formed your business. In this regard, not all businesses are treated the same. Sole proprietorships pay taxes differently than S-corporations.

Despite the differences between each kind of business there are a few general terms you should know:

Income Tax – most businesses file an annual income tax return. Businesses must pay income tax as they earn and receive income and then file a tax return at the end of the year.

Estimated Tax – estimated tax payments offer an alternative to paying income tax throughout the year as your company earns money.

Employment Tax – companies that have employees are expected to pay taxes related to having staff on their payroll. These include Social Security and Medicare taxes.

Excise Taxes – excise taxes are paid when your business makes purchases on specific goods and are often included in the price of the product.

EMPLOYMENT AND LABOR LAW

There are also many government regulations on businesses that employ workers and independent contractors, in the form of federal and state labor laws. Here are the most common labor laws:

Wage and Hours – according to the Department of Labor, the Fair Labor Standard Act (FLSA) prescribes standards for wages and overtime pay.

Workplace Safety and Health – the Occupational Safety and Health Administration (OSHA) required that employers provide their employees with work and a workplace free from recognized serious hazards.

Equal Opportunity – most employers with at least 15 employees must comply with equal opportunity laws enforced by the Equal Employment Opportunity Commission (EEOC), which mandates that certain hiring practices, such as gender, race, religion, age, disability and other elements are not allowed to influence hiring practices.

Non-US Citizen Workers – the federal government mandates that employers must verify that their employees have permission to work legally in the United States.

Employee Benefit Security – if your company offers pension or welfare benefit plans, you must be subject to a wide range of fiduciary, disclosure and reporting requirements under the Employee Retirement Income Security Act.

Family and Medical Leave – the Family and Medical Leave Act (FMLA) requires employers with 50 or more employees to provide 12 weeks of unpaid, job protected leave to eligible employees for the birth or adoption of a child, or for the serious illness of the employee or a spouse, child or parent.

Posters – some department of labor states require notice to be shared or posted in the workplace for employees’ view.

ADVERTISING

A good advertising strategy can do wonders for your business. But before you dive in, you’ll need to make sure that you’re playing by the rules and government regulations. For example, you have to make sure the claims in your ads are not untruthful or purposely deceptive. Using testimonials in your ads comes with additional regulations. Violating these rules can result in fines, which defeats the purpose of your advertising in the first place.

EMAIL MARKETING

Closely related to advertising is email marketing. If your business engages in email marketing, there are separate regulations you’ll need to comply with under the CAN-SPAM Act. There are several things that this Act regulates but some of the main components are:

  • Don’t use false or misleading headers
  • Don’t use deceptive headlines
  • Indicate that the message is an advertisement
  • Induce your business name and address
  • Show the customer how to opt out of emails and honor the opt-out requests promptly.

Each separate email violation is subject to hefty fines so make sure you know the ins and outs of this law before you set up your email marketing strategy.

There are many considerations that small businesses must think about regarding the governmental regulations imposed on them and seeking profession advise should always be your first step.

For more information on how to legally protect your business please pick up a copy of my bestselling book: ‘Go Legal Yourself’ on Amazon or visit my website at www.golegalyourself.com

Disclaimer: This information is made available by Bagla Law Firm, APC for educational purposes only as well as to give you general information and a general understanding of the law, and not to provide specific legal advice. This information should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.


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