As others have said, it would be a good idea to speak to a lawyer.
I know that the taxes and fees associated with becoming an LLC or corporation can seem steep, but if you plan to hire employees, it is an absolutely vital step. You said your business is a sole proprietorship, and that opens you, personally, up to all of the liability that your business incurs. In other words, if something goes awry and your business is sued, your home is on the line. And your risk for being sued increases as you take on employees/volunteers/interns/etc.Look for a business law clinic at a local law school - they might charge a small fee but there's a good chance they will work for free. Your issues likely have a simple solution, and there's no reason to pay a lot in legal fees for that.
Good luck!
orware|12 years ago
The LLC step (when I had done it before) was pretty straightforward over at http://www.legalzoom.com/ but it was a few hundred bucks and I did it for exactly the reasons you described...to get out of that open liability that the business could incur (I was younger, and thinking bigger about the growth my little company would have so I did a whole bunch of research to try and do the best thing I could do at the start). But I ended up shutting down the LLC because of the expense/benefit ratio wasn't working for me at the time and then stopped doing business really until I started up again in 2010 with the software business on a tiny scale.
If I did decide to take on a more employees/volunteers it would definitely be a route I'd want to take again.
We don't have any local law schools within a few hundred miles, but I think we do have one business law instructor here at the college who might allow me to pick his brain if I asked.
Thanks again for the feedback!
(Sorry for the delay in my reply...HN started giving me the "You're submitting too fast. Please slow down. Thanks" error when I tried to submit this reply and another one).