Online businesses offer tremendous opportunities for entrepreneurs and hobby-business owners alike. When it comes to starting an online business though, you still must comply with federal, state, and local laws. Here are some of the most important ones to remember.

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Always Declare the Controlling State Law

If you don’t declare the controlling state law somewhere in your online contracts or your website, then anyone who sues you can determine the state law that applies. As long as the plaintiff can show good reason for suing you from that particular state, that state's laws will apply. This means that you could be hauled into court on the other side of the country, and it could also mean that you will be more likely to lose based on the standards of the other state’s court. You can create Online Terms and Conditions to declare the governing state.

Set Up a Separate Business Checking Account

In most states, including Delaware, Kentucky, and Florida, you must handle all business transactions through a separate business account if you want to receive the greatest number of business deductions or maintain corporate protection. Always keep your business finances and your personal finances separate. If you don’t, you could face expensive fees and penalties.

Establish Your Privacy Policy

Most online businesses collect information in some way. If you do this, then you need to protect yourself legally by establishing a Privacy Policy. This policy sets forth what you will or will not do with information that you collect from website visitors. Once you publish your Privacy Policy online, you need to follow it. You’ll also need to notify your users if you change your privacy policy, allowing users to accept the changes.

Get started Start Your Incorporation Answer a few questions. We'll take care of the rest.

Get started Start Your Incorporation Answer a few questions. We'll take care of the rest.