In today's podcast episode, I'm pulling a clip from our membership called the Dietitian Boss Library, where our team lawyer, Danielle Liss answers your questions. The focus of today includes the two questions. If there's a brick and mortar business setup, do we need any other specific licenses to sell online products?
And the second question, at what point In my business, should I get an LLC? I want to be protected, but I don't exactly have clients at this time. So our team lawyer is going to answer these two questions. And she had been interviewed by our operations director from our team. And we, by all means, they're not sharing.
every single question and answer. So I do invite you to join the dietitian boss library at dietitianboss. com, but we want to give you a sneak peek preview of all of this valuable information. So I hope you enjoyed today's episode, which is pulled from our Dietician boss library, where you have a chance to submit questions and join live.
Welcome our team lawyer, Danielle Liss. Hi everybody. Thank you so much for joining. I am excited to be here because I know that the legal stuff, if you will, for the business is often a big hurdle for folks. And I don't like to see people get hung up on that because I think that. Your business is always going to be a work in progress.
The legal is going to morph and change as you grow. So there is always going to be something happening on the legal side. So my goal for this session is to answer some basic questions. Um, the one thing I will always tell people at the beginning is Unless we are working together separately, while I am a lawyer, I am not your lawyer.
Everything that I am providing you today is really meant to be general legal information. I can't give any specific opinions if you are not one of my clients. And that's kind of the. The limitations of my own license and I know we're going to be talking about licensure today so it fits in beautifully.
Let's just say that. So let's dive in to the questions that were submitted first, and I see a handful of Things that look like they there is some overlap. So I'm going to go a little out of order for some of these. So the first question was, if there is a brick and mortar business setup. Do we need any other specific licenses to sell online products.
So, I think for that, I would say probably not, usually it is going to be, um,
the likelihood that your state, county, city has a license that is specific to online products is probably slim. What you would always want to make sure of is that you are being compliant with any state tax laws. If there is something that you need to collect on, and I always recommend talk to your CPA about that.
Thank you. Usually services aren't going to be required, but I am not a tax attorney. So I always will defer to the folks on the financial side to let you know if there's anything that you need to collect sales tax on that type of thing. Um, so if you've got, and I'm not sure what you mean by having a brick and mortar setup.
I don't know if that means you've got an LLC, or if it just means that you have a physical location. Um, but as long as you have Everything that you need for that, the likelihood that you need additional licensure for it is probably pretty slim. Um, but that can also depend on the kind of products. So if you were selling something that might fall under the MNT umbrella, I'm not sure what kind of product we would do that would fall under MNT, but if it was, then you may need to deal with some licensure there, just in terms of your professional licensure, not necessarily like business license.
Um, so all that said, probably not, but it may depend on exactly what you're doing. Can I, can I jump in and ask a question on the road to clarify? I think what I'm betting they, they mean is like selling an online course. Um, it was what I would think they probably mean by an online product. Um, because most of them don't have any sort of physical, there's going to be a, I think it's really slim.
Like For example, a friend of mine just recently moved to North Carolina. North Carolina has something like 1500 different types of business licenses. And she came to me and she said, I do not know which one I need. And I was like, I have no idea which one you need because there are so many. So sometimes it's just a matter of taking a look and seeing what's required.
I do not know of any that have a very specific online business. license that's required. Typically, like when you think about licenses, it's going to be, are you doing construction? Are you doing, you know, insurance? Like some of those pieces, I think are much more well known for having licensure in most states.
Um, online sales is usually not, it tends to be more about if you need to be collecting sales tax for the state that you're in or for any other states that you're working in. And I would add too, I know from my experience when I moved, because I'm in the state of Missouri, um, my, I had to get a local city license, but they didn't even know for sure.
They're like, we don't know if you want for online business, but let's just do it in case. So sometimes it is contacting like your county or your state to just ask them, find a person who's responsible. And then they can tell you for sure. And then, you know, it's always better to be safe than sorry. And usually they are super, super nice when you reach out, like they want to help.
It's not like, yeah, you might have to sit on hold, but for the most part, it could be state could be counting, could be local. So that's the fun part. So just check with the city that you're in and. What you may want to ask is, is a general business license required? Because for example, I'm in Nevada and Nevada does have like a general requirement that we have to follow.
So if there's a general requirement, yes, but if it falls under if you've already got that brick and mortar and it all still falls under the same sort of scope as what you're doing in the brick and mortar, you may already be covered by that. So. My guess is no, but you still may want to check. Okay. So the next question is a good one.
And there's been a lot of questions here about LLCs. So I think like, I want to try to cover all of these at once. So let's see, at what point in my business should I get an LLC? We'd love to be protected, but don't have a lot of clients. I see another one that says how to go about getting it. So we can talk about that.
Um, And can we have, or different LLC. So I can talk about that. So let's go through all three of those points. So at what point should you get an LLC? This may vary for everyone. The goal of the LLC is to give you protection from your personal assets and to make sure that you don't have liability for something that happens within your business.
I always think an LLC is a good idea and it does not have to be just when you are making a lot of money. I think that they are a good idea. I personally think they're a good idea for anybody who's dealing with some type of professional licensure, like you are as dietitians. I think that it's a good idea to have it from the start.
Um, just because there's always a slightly higher risk when your license is on the line. Like that's my personal take on it. If you want to wait until you are making more money, you absolutely can for some people depends on where they live. Because if for example, you're in California, California is about 800 a year for an LLC.
Other States, I think Massachusetts is high. I think they're around 500. I'm in Nevada, which is a common one. And that is like, I think we're like 400, 425, something like that. So it's not, it's certainly not free by any means. Um, in terms of setup, so I think this is also a good Part to bring into the discussion at this stage, because when it comes to set up, there's a couple of things that you need.
And this, it varies state to state what the requirements are, but generally speaking, you are going to be filing what's called articles of organization with your secretary of state or with whatever your. State formation entity is usually it's secretary of state. Some have different things. And when you're doing that, they're going to ask you for information about a registered agent.
And this is something that confuses a lot of people. So I want to make sure we talk about it. Registered agent is essentially the name of someone who is able to accept service of process. on your behalf. So that means if you get sued and someone is trying to issue a summons, that person is able to accept it on your behalf.
If you have an office and you're there during whatever the required hours are, you can be your own registered agent, but that puts your address on file. There are a lot of times where people get hung up because they're like, I don't know what to do. With the registered agent piece. Since I am assuming most of you are likely online business owners and doing work from home.
There's a company that I rather like called Northwest registered agents on Northwest is a little bit more expensive. Then some of the other registered agent companies, there are 125 a year, whereas I promise you can find somebody whose services are about usually 49 is the amount that I typically see.
The reason I like Northwest registered agent is because they will let you use their address on your articles of organization. So you don't have to put your home address out there. And I think for a lot of people who are working online, that's a nice benefit to have so that it is. One more way that you can try to keep some information private and off of the state databases.
Um, if you don't care about that, that absolutely fine, totally understand, but you will need to have a registered agent. The question that asks, how should you do it? I personally think that using a lawyer is probably not something that you need to do. There are some States, depending on what kind of work you're doing, where you would need to have a professional limited liability company.
I think New York may be one of those. Um, Because certain licensed individuals will need a professional entity, you do not have to have one. In most states that I will tell you I personally, while I am eligible for one, I do not have a professional limited liability company I have just a regular LLC, because my insurance covers pieces and it just didn't seem worth the extra hassle to me.
So, if you are comfortable doing it, you can absolutely set it up yourself. If your CPA offers it, they're often cheaper than a lawyer to do certain pieces of it. I think that you can also go to the registered agents and most of the time they have formation services as well. And so Northwest registered agent, for example.
They will have something that's like, do you need to form it? And then they'll give you what the fees are. So I recommend looking at somewhere like that because they do make it very easy in terms of the way their technology is set up, that type of thing. Now, in terms of when is it appropriate to bring a lawyer in now, if you want a lawyer to handle it, I do not mean to deter you, but I know that when we're talking about early stages of business, you're probably more budget conscious At later points, I think it is extremely important to get a lawyer involved if you were doing it as a partnership.
So if you have someone else in the business besides you, you should bring someone in. And the reason why there is a governing document called an operating agreement. That is essentially Kind of the, the rules for your company. Think of it that way. It's just like the governing document. This is how we're going to run things.
This is who has powers. This is all of those pieces when you're running it on your own. An operating agreement is not always a requirement under state statutes. So even though it's not required, if you have more than one person, I strongly recommend it. And that is because if something goes bad, I want you to think of it like the prenup for your business.
Um, you need to know what's going to happen because those breakups can be unpleasant and ugly and By having thought about it ahead of time, that will hopefully alleviate some worries. But that is where I absolutely recommend having a lawyer come on, help you get your operating agreement set up. And then from there, once your LLC is formed, you can get your EIN number through the IRS.
They actually do make that quite easy. Um, you pretty much just need your social and then the information that they asked for and they'll generate the EIN for you. Right away. Um, so that's my view on formation. I do think that LLCs are A really good thing to have, but I've talked to folks who are like, I just got out of school.
I have a boatload of student loan debt. I have no assets. There is nothing to take from me. And if that's the case, and you want to try things out as a sole proprietor first, you absolutely can. In that case, if you are working with people, I do want you to really look at what your insurance coverage looks like because your insurance will be really important then.
And I want you to make sure that your contracts are really clear when it comes to liability and guarantees and things like that. I don't think that you can. Always contract your way out of liability. And I don't think that insurance is always going to be able to give you 100 percent coverage on everything.
But I think that I view those as kind of the trifecta for protecting yourself. So if you don't have that LLC piece included, then at least look at the insurance and Your contract to make sure you've got coverage there. And I'm just going to give you my two cents about insurance. Um, be cautious with your insurance policies because a lot of times as our DS you have.
More or less professional liability policies that are really meant for MNT in a clinical space. They are not always covering you for these broader businesses that you are building. So you want to be aware of what's in your policy and what's covered and what they say isn't covered. And then if anyone ever needs an introduction to an insurance company, I have worked with a broker for many years I used to be in house for.
And. Digital health and wellness company. So I worked with them there and I've referred many dietitians to them over the past few years, and they're very good at kind of saying, okay, here's where your liability coverage. ends and what you don't have available. If you're getting into online work, here is what we can, how we can kind of fill in the blanks.
And usually it's going to be an errors and omissions policy. So that way you're kind of covering yourself for those digital pieces. And when it comes to doing digital, I think cyber insurance is also a really important factor. And they can talk about that as well, because even if you're saying to yourself, I have my, basically my Malpractice insurance.
And I have a general liability policy. I don't know what general liability covers anymore for most businesses who are doing business online because general liability used to be like what happens on the premises of your business. Who has those, right? Like we're all doing business online. So it's almost like general liability has become a little less, you know, A little less what we need, whereas Arizona missions is probably more.
Um, so if that ever comes up and people have questions, I'm always happy to do that introduction because I've sent many folks their way. And it is truly because I think that they have a good understanding of both online business and the health and wellness space. Um, the next question is, can I have one LLC where I offer kind of all the things or do I need them or do I need to have multiples?
I will tell you, I have two separate businesses. One of which is a law firm. The other is a legal template shop. I have two separate LLCs because I do not want any question at all as to the separation between them, because one is going to be basically the way I view it is this stuff falls under my license.
This is my legal information products. I know many lawyers who mix them when they have those types of businesses. So it can depend on what your personal preference is, because there is, of course, a cost associated with having multiple LLCs. If you decide to go down that road, I think that that's an important time to get your accountant involved in the conversation, because not only would it be a separate LLC, that's essentially separate accounting, separate P& Ls.
All of those things would also Be separate. I think that if what you are doing is coaching group coaching and courses. So, not MNT. I think all of that could easily fall under one LLC, unless there was something that you specifically. Wanted to carve out most of the folks that I work with have generally done one LLC for this type of work.
So I don't think it is necessarily something you have to do. I think that the example that you're giving about therapists in terms of protecting their license is because I think that they are doing. Psychotherapy. So something that is very licensed specific on one hand, and then they're doing coaching on the other.
So very similar to the way that I do it, whereas I need to make sure this is my licensed activity. This is my unlicensed activity. If what you're doing, however, is all coaching. So it all falls under sort of the unlicensed activity education portion. I think you're probably okay. But if you're doing something like MNT for 90 percent of the people that you work with.
One on one, and then you're just doing some general information products. Those information products might not have a whole lot of risks. So you might be okay putting them all under the same umbrella, but you want to make sure that you've got disclaimers all over the place that say, you know, this does not mean that you are a patient.
This does not mean that we are X until you sign a contract, whatever that might look like, it's just going to be making sure you've got some additional protection in there. If you need to have those separate entities. Special thanks to our team lawyer, Danielle Liss, who shared her time and information to help us dietitians learn how to better start from zero and make sales and also become legally legit.
Now, if you want to learn more of these questions and answers in a live format, I invite you to join The dietitian boss library found at dietitianboss. com. As a reminder, we only shared two questions out of dozens of questions that Danielle lists our lawyer reviews on a very regular basis as she's a guest inside of our membership.
In addition to many other guests that we regularly have in finance reimbursement and other areas to help you grow your dietitian. business. Thank you so much for joining us today. If you want to learn more about Danielle Liss, if you go to our resources tab at dietitianboss. com, you can go ahead and purchase one of her contracts for dieticians or any other legal services that can help you make sure you're compliant in your dietician business.