Plano Business Assumed Names

You can run your Plano Texas company using an assumed name. Also known as “doing business as,” “DBA,” and fictitious name, an assumed name is a name other than your own under which you do business with the public.

For example, the name “AAA 24-Hour Carpet Cleaning Services” could be an assumed name. However, the name “John Smith’s Cleaning Services” is not an assumed name if your own name really is John Smith. Many sole proprietorships register an assumed name for several reasons, including privacy protection, and the ability to sell a company that isn’t closely associated with a personal name.

For about 10 bucks, you can register an assumed name for your business with the Collin County Clerk’s Office. However, it is important to note that registering an assumed name doesn’t protect you from trademark or service mark infringement claims. For example, if you registered the name “Starbucks” for your coffee shop, there’s a good chance that the real Starbucks based in Seattle would come after you with their lawyers for infringement.

It’s also important to note that name registration doesn’t provide any asset protection features. If you’re doing business as a sole proprietorship under an assumed name, you’re not going to have the liability protections afforded by doing business as a Texas limited liability company or corporation.

If you have any questions about what’s the best way of doing business, be sure to talk with your Plano business attorney.

Plano Texas Business Rules of Customer Engagement

If you don’t establish rules for your Plano business, your customers will do it for you. Instead of a win-win relationship, you’re likely to find yourself on the short end of the stick. Contrary to popular belief, the customer is not always right. In fact, your business rules should establish what is right because, more often than not, your customer doesn’t really know.

What should you do?

Establish clear rules on how your prospects and customers will deal with you, i.e. what is and isn’t acceptable behavior — then enforce those rules.

For example, if you have Net 30 payment terms, don’t tolerate slippage. There will always be customers who will test your boundaries. The Net 30 becomes Net 120…and then simply nonpayment if you make exceptions to your rules.

When you enforce the boundaries set by your rules, you’ll either eliminate potential troublemakers before they become customers or quickly thereafter. This is important because you’ll make more money dealing with customers on your terms than catering to those who violate them.

Of course, one of the best ways to set your rules is in a clear “plain English” contract that’s enforceable under Texas law. When your customer signs the agreement, it is hard to argue ignorance of the rules within it. Your Plano business lawyer can help you put together customized Texas contracts for unique deals and standard contract templates for repeat transactions that contain the right legal terms.

Texas Subchapter S Corporations

Many Plano Texas entrepreneurs think they need to set up a corporation in order to protect their personal assets. As a practical matter, most really mean a Subchapter S corporation.

What is a Subchapter S corporation? That’s a corporate tax election that lets income pass through the corporation to the shareholders and be taxed once at the federal level (Texas has no state income tax – knock on wood – so an “S” election at the state level isn’t necessary). This contrasts with a Subchapter C corporation where income is taxed twice: once at the corporate level and a second time at the shareholder level.

Rarely does it make sense to take the double hit on taxes if your business can qualify as an S corp instead.

However, Texas business owners should seriously consider using a limited liability company (LLC) instead of an S corporation. In most cases, you get all all of the benefits of an S corp for both asset protection and tax purposes without all of the legalese required to operate a corporation. A properly drafted LLC operating agreement (a contract between the owners of the LLC) can govern how things are run without having endless meetings and related legal paperwork.

Your Plano business attorney can help you select the right type of Texas business entity for your company. Just don’t assume that a corporation is the right way to go.

Trademarks: Texas

Your business’ products can be represented by a unique logo or symbol, phrase, a single word, or phrase. In some instances, even a color, smell or sound can be your Texas company’s trademark. Most nonlawyers refer to all business marks as “trademarks.”

Legally, trademarks refer to your company’s products while business services (such as carpet cleaning or dental services) can have “service marks.” Both are protected under the law. How much they are protected depends on a variety of factors.

You have less legal protection for your mark if you don’t register it because common law marks don’t have the rights granted by Texas statute or U.S. federal law.

Marks can be registered with the State of Texas and, in some cases, with the U.S. Patent and Trademark Office. State registration is better than nothing because it puts the public on notice that you’re claiming the mark as your own.

However, the best registration (if your mark qualifies) is with the U.S. Patent and Trademark Office. Federal registration protects your mark beyond Texas borders plus provides you with additional rights in the event you have to stop someone from misusing (infringing) your mark.

Talk with your Texas business attorney about trademarks and service marks that you use in your company. He will be able to advise you on the best ways to prevent trademark infringement by your competitors and others.

Copyrights: Texas

A copyright is the legal right of the owner of a creative work (such as a book, photograph, song, or movie) to protect his intellectual property from misuse by others. Your Texas lawyer can register your creative work with the U.S. Copyright Office so that you receive extra legal protections under federal law. In some instances, the person who violates your registered copyright (a copyright infringer) will have to pay more money in damages and your attorney fees.

Note that copyright law is not designed to protect ideas and facts…just the particular way that you have arranged those facts. This includes preventing someone from taking your book and turning it into a movie (a derivative work) without your permission.

Unfortunately, copyrights are based on old laws that can’t keep pace with technology (such as the Internet). When Congress changes copyright protections, the rules are made more complex and confusing — plus they are designed to protect Hollywood movie studios and music companies (the fat cats that make campaign contributions to get those changes passed into law).

You’ll want to speak with your Texas business lawyer who knows copyright law to make sure that you get the right legal protections in place for your creative works. This will help you limit any damages caused by copyright infringement.

Texas Nondisclosure Agreements

Texas business nondisclosure agreements are contracts where one or more parties agree to keep secret certain information. A nondisclosure agreement can be an independent contract or the provisions can be part of a larger agreement, such as an employment contract or an agreement to buy a company. From tech trade secrets to customer lists, there are many topics that one can agree not to disclose to others.

If your Texas company wants to enter into a nondisclosure agreement, remember the handshake rule. If you wouldn’t trust the person to honor a nonbinding “gentlemen’s agreement” agreed to with a handshake, chances are high that you’ll end up in court trying to enforce your rights under the nondisclosure contract. In nondisclosure breach cases, your damages are often high because the confidential information has already been used against you by the time you head to court to enforce your legal rights.

Quite frankly, putting the nondisclosure provisions in a contract serves the primary purpose of letting the other party know how important you view the data as confidential and that you intend to protect your legal rights. Your Plano business lawyer will be able to draft contract language that makes this clear. That will deter some from ever crossing you by leaking the information or otherwise using it in violation of your contract.

Texas Contracts

A Texas contract is an agreement between at least two parties (individuals or businesses) that describes what the parties have agreed to. Provisions agreed to can be positive (do X), negative (not do Y), or a combination of both (do X but not Y).

Although parties usually intend for their contract to be legally enforceable, there are agreements that may not be legally binding. For instance, if one party to the agreement is mentally incompetent, the contract might not be binding against him. A contract to do something illegal is almost always unenforceable. For example, if the parties agree to sell cocaine (an illegal substance), there isn’t going to a way to enforce the agreement in court or otherwise.

Most Texas business contracts of value are in writing to ensure that they can be enforced. However, in some instances, a verbal agreement can be a binding contract. Factors that may determine whether an oral contract is legally enforceable include the dollar amount (value) of the contract and whether the parties can perform their obligations under the agreement in less than one year.

Oral agreements are not preferred because they can lead to misunderstandings (and related lawsuits). The better course of action is to have a written agreement signed by all the parties to the agreement.

Whether or not your Plano, Texas business attorney negotiates the contract on your behalf, you should have him paper the details to make sure that your rights are fully protected.

Of course, the best action is to only enter into contracts with parties who you trust will carry out their obligations under the agreement. If your gut instinct bugs you about a potential deal, that red flag is probably a good sign that the proposed contract will harm you in some way. Be prepared to walk. There are always alternatives to signing a bad contract.

Buy-Sell Agreements: Texas

Texas business owners can use buy-and-sell contracts called buy-sell agreements to make it easy for surviving owners to purchase the equity interest of a co-owner who wants to leave the company (such as retirement), faces personal bankruptcy, becomes incapacitated because of ill health, or even dies.

If your Plano business is a Texas corporation, a Texas limited liability company, a general or limited partnership, you should consider putting a buy-sell agreement into place to protect the long-term interests of yourself and the business.

One of the key benefits of using a buy-sell agreement is that it reduces risks for everyone in advance of bad events. You can customize the agreement to have it address the unique facts surrounding your business and the individuals who own it rather than trying to deal with courts and lawyers after-the-fact when a co-owner leaves. With careful planning, the contract will permit your Plano company to continue operations without a hitch.

Of course, your business and your lives will change over the years. If you’ve got a buy-sell agreement in place already, you’ll want to review it with your Plano business law firm to make sure that it always reflects what you want done based on the present rather than how things used to be.