Frequently Asked Questions
Answers to what clients ask most
Below you'll find answers to the questions I hear most often from business owners, entrepreneurs, and families. If your question isn't here, I'm happy to talk.
Business Law Questions
Both LLCs and corporations provide personal liability protection, meaning your personal assets are generally shielded from business debts and claims. The main differences are in structure and taxation. An LLC is more flexible — it has fewer formalities, can be taxed as a sole proprietorship, partnership, or S corporation, and is governed by a company agreement that you largely customize. A corporation has a more rigid structure with shareholders, directors, and officers, and is governed by bylaws. For most small businesses in Texas, an LLC is the simpler and more flexible choice — but the right answer depends on your specific goals, tax situation, and whether you plan to bring in investors or partners. Discussing your situation with an attorney and your CPA or tax preparer before choosing is well worth the time.
A Series LLC is a special type of LLC available in Texas that allows you to create separate “series” or cells within a single LLC, each with its own assets, liabilities, and members. It is most commonly used by real estate investors who want to hold multiple properties under one umbrella entity while keeping each property’s liability separate from the others. For most small businesses with a single line of operations, a standard LLC is sufficient. If you own or plan to acquire multiple distinct business ventures or properties, a Series LLC may be worth exploring. Texas has one of the most developed Series LLC statutes in the country.
You are not legally required to use an attorney to form an LLC in Texas — the state filing itself can be done online through the Texas Secretary of State. However, the filing is only the beginning. The company agreement — the document that governs how your LLC actually operates, how decisions are made, how profits are distributed, and what happens if an owner wants to exit — is where most DIY formations fall short. A generic company agreement downloaded from the internet may not reflect your actual ownership structure, may conflict with Texas law, or may leave critical issues unaddressed. An attorney ensures the legal foundation of your business is built correctly from the start.
A buy-sell agreement should address at minimum: the triggering events that activate it (death, disability, divorce, voluntary exit, bankruptcy); how the business will be valued when a trigger occurs; who has the right or obligation to buy the departing owner’s interest; how the purchase will be funded (often life insurance); any transfer restrictions that prevent an owner from selling to an outside third party without consent; and timelines for completing the buyout. A well-drafted buy-sell agreement removes ambiguity and gives every owner a clear roadmap for what happens under any scenario. It should be reviewed and updated whenever the business or its ownership changes significantly.
Yes — and it is one of the most cost-effective legal services a small business owner can invest in. Commercial leases are drafted by landlords’ attorneys to protect the landlord. They are long, complex documents that contain provisions most business owners do not fully understand when they sign — personal guarantees that put your personal assets at risk, hidden operating cost escalations, restrictive use clauses that limit what you can do in the space, and unfavorable renewal and termination terms. An attorney review identifies the provisions that create risk and negotiates changes before you are bound. The cost of a lease review is almost always far less than the cost of a lease dispute or an unfavorable term you’re locked into for years.
A master service agreement is a contract that establishes the general terms governing an ongoing business relationship — payment terms, confidentiality, intellectual property ownership, liability limits, dispute resolution, and termination rights. Rather than negotiating all of these terms every time you enter a new project or engagement with the same party, an MSA sets them once and then individual statements of work govern the specifics of each engagement. MSAs are common between businesses and their vendors, contractors, and clients. A well-drafted MSA protects your business and streamlines future contracting.
The distinction matters significantly for taxes, benefits, liability, and compliance. An employee works under your direction and control — you set their schedule, direct how they work, and are responsible for payroll taxes, workers’ compensation, and other employment obligations. An independent contractor is engaged to complete a specific result and controls how they achieve it. Misclassifying an employee as an independent contractor can result in back taxes, penalties, and liability under both federal and Texas law. The classification is based on the actual nature of the working relationship, not just what the contract says. If you’re unsure how to classify a worker, it’s worth discussing with an attorney and your CPA or tax preparer before you engage them.
Registering your business name with the Texas Secretary of State — either as an LLC name or an assumed name (DBA) — gives you the right to use that name for your business entity in Texas. It does not give you trademark rights. A federal trademark registration with the USPTO gives you exclusive rights to use your mark nationwide in connection with your goods or services, the ability to stop others from using a confusingly similar mark, and a public record of your ownership. For businesses that operate beyond a purely local market, or whose brand is a meaningful business asset, federal trademark registration is worth pursuing. A Texas state trademark filing is also available and provides some protection within Texas at lower cost.
Estate Planning Questions
Yes. Being married does not eliminate the need for a will — it actually makes one more important. Without a will in Texas, your estate passes under the Texas intestacy statutes, which divide property between your spouse and your children in ways that may not reflect your wishes and can create complications for a surviving spouse trying to manage community and separate property. A will lets you direct exactly how your assets are distributed, designate who administers your estate, and — if you have minor children — name a guardian. For married couples with children, a blended family, business interests, or significant assets, a will is essential.
A will takes effect at death and must go through probate — a court-supervised process — before your assets are distributed. It is a public record. A revocable living trust takes effect immediately, allows you to manage your assets during your lifetime, provides for you if you become incapacitated, and transfers assets to your beneficiaries after death without probate. It is private. A trust generally costs more to establish upfront but can save time, expense, and privacy for your family. Many clients use both — a trust to hold major assets and a pour-over will to capture anything not transferred to the trust during your lifetime. The right choice depends on your assets, your family situation, and your goals.
Probate is the court-supervised process of validating a will, paying debts, and distributing assets after death. In Texas, probate is generally less burdensome than in many other states — Texas has an independent administration process that limits court involvement. However, it still takes time, costs money, and creates a public record. It can be avoided or minimized through tools like a revocable living trust, beneficiary designations on retirement accounts and life insurance, and transfer on death deeds. Whether avoiding probate is a priority depends on your situation.
A durable power of attorney is a legal document that authorizes a person you designate — called your agent — to manage your financial and legal affairs on your behalf. “Durable” means it remains effective if you become incapacitated, which is the situation where you need it most. It can take effect immediately upon signing or upon a triggering event such as incapacity, depending on how it is drafted. A medical power of attorney specifically authorizes your agent to make healthcare decisions for you if you cannot. Without these documents, your family may have to seek a court-appointed guardianship to manage your affairs — a process that is time-consuming, expensive, and stressful.
An advance directive — also called a directive to physicians or living will — is a document that expresses your wishes regarding life-sustaining medical treatment if you are in a terminal condition or irreversible situation and cannot communicate those wishes yourself. It guides your doctors and removes the burden from your family of making those decisions without knowing your wishes. In Texas, an advance directive works alongside a medical power of attorney to give your healthcare providers and family a complete picture of your intentions. Every adult should have one — they are not just for the elderly.
Your estate plan should be reviewed whenever you experience a significant life change: marriage, divorce, the birth or adoption of a child, the death of a beneficiary or named agent, a major change in assets or financial situation, the start or sale of a business, or a move to a different state. As a general rule, reviewing your plan every three to five years even without a triggering event is good practice — laws change, family circumstances evolve, and a plan that was right five years ago may no longer reflect your wishes.
Business owners have more to plan for, not less. Your estate plan needs to address not only the distribution of your personal assets but also what happens to your business interest at death or incapacity. Without a plan, a business interest can pass to heirs who have no ability or desire to run the business, trigger a forced sale, or create conflict among surviving co-owners. A buy-sell agreement coordinates with your estate plan to provide a clear path for the business. Business owners who delay estate planning often leave their families and co-owners in a very difficult position.
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