Whether you are starting a new business or you are expanding your current business, there are many different small business laws that you need to understand and follow. These laws are essential to the success of your business. For example, you need to know how to determine if an employee is exempt or not, and you need to understand how to set up payroll for your business. In addition, you need to understand how to comply with laws for taxes, licenses, and permits.
Exempt vs non-exempt employees
Whether you are a small business owner or an employee, knowing the difference between exempt and non-exempt employees is important. The Fair Labor Standards Act (FLSA) defines exempt and non-exempt employees and explains what constitutes an exempt position. Knowing the differences can help you better run your payroll. This guide can also help you minimize your risk of wage claims and audits by the Department of Labor.
The FLSA defines three basic tests to determine an employee’s exempt status. An employee may be exempt if they perform their job duties in one of three categories: administrative, executive or professional. Administrative duties are considered exempt if the employee regularly performs the duties of an employee in the office of a recognized department.
Overtime law
Whether you are a new small business or you are trying to comply with the new overtime rules, you must know your rights. Failure to comply can have severe consequences for your business. You may face fines, legal action, or both.
The Department of Labor recently instituted new overtime pay rules. The new rule requires that employees who work more than 40 hours in a workweek be paid overtime at a rate of one and one-half times their regular pay.
The rules apply to both salaried and hourly employees. The rules are designed to help small business owners stay in compliance with the law.
The Department of Labor issued a new overtime pay rule in September, which will take effect on January 1, 2020. The rule will revise the salary level for certain workers, increasing the minimum salary from $455 to $684.
Worker’s compensation insurance
Having workers’ compensation insurance for small businesses protects you from financial loss and lawsuits. It covers medical costs for injured employees and lost wages. It can also reimburse expenses for rehabilitation services.
Workers’ compensation insurance is regulated at the state level. Each state has different requirements. If you don’t have workers’ compensation insurance, you could be fined or jailed for breaking the law.
There are different types of small businesses that require workers’ compensation insurance. For example, some states require employers to have coverage even for part-time workers. In other states, if you have less than five employees, you don’t need workers’ compensation insurance.
There are also different types of businesses that aren’t required to have workers’ compensation insurance. For example, a business owner may own a small retail store.
Licenses and permits
Getting a license is an important part of operating a small business. It will allow your business to operate legally and keep consumers safe. However, obtaining a license is a complicated process that can take a lot of time and resources.
There are many different types of licenses, and each may be required depending on the industry and location of your business. If you are unsure about which license you need, consult a professional or an attorney. They will be able to help you navigate the complicated process.
There are also many different types of permits. Permits are issued by the government and usually grant permission to conduct certain activities. They can be issued to individuals, businesses, or organizations, and are typically restricted to certain locations.
Taxes
Whether you’re a sole proprietor, a partner, or a member of a corporation, you will have to pay taxes on your earnings. In addition, you may need to pay employment taxes, self-employment taxes, or income tax.
When you are ready to file your tax return, you will have to determine the total taxes you owe. You’ll also have to divide that total into four equal payments. If you miss any of those deadlines, you could be facing additional penalties.
If you’re a business owner, you may be eligible for a variety of deductions, but it’s best to check with a tax specialist to make sure you’re on track.
Besides taxes, you may also have to pay interest and penalties. You can mitigate those red flags by organizing your expenses into specific categories. Also, be sure to keep your business and personal finances separate.