How would I create a business entity for an online business with a Canadian in Canada if I am a US citizen in the U.S.?
2 attorney answers
Attorney Minnick's advice is wise and accurately describes the benefits of setting up a new entity the right way early in the process. In my experience those who take the time to dot the "i's" and cross the "t's" find their new venture runs smoothly and those who fly by the seat of their pants frequently rue the day the failed to come up with a proper operating agreement or other business structure. You, as an individual, are allowed to "earn a few dollars" on-line without creating a business entity. As a practical matter, you and friend might consider earmarking your first individual earnings to spend on consulting with business counsel in your respective countries and states to take advice on the best form of structure for your venture. If earnings rise to more than a nominal level and merit taking further steps, you can fund the legal costs and business entity filing and organizational fees and annual fees tax returns from the proceeds. I wish you luck.
Any answer provided on the AVVO website is for informational purposes only and does not constitute legal advice for your specific situation. You should always seek legal advice before taking any action which may affect your future rights. Your local legal aid office may well provide information or access to free legal advice and your state bar organization may provide referrals to reputable attorneys who will provide advice on a reduced cost basis.
Before the two of you try to do something that few non-lawyers even try to do my strong advice is for the two of you discuss and agree on an amount of money both of you are willing to spend hiring a very experienced small business lawyer and then start looking for one.
Then, after your new business lawyer has done all the work needed to create the new company and do everything else required to get your new joint venture up and flying-the two of you need to agree on some reasonable periodic retainer (monthly, quarterly or annually) to find and hire a qualified corporate counsel to be there to help you as you begin the most difficult part of what appears to be a good idea.
None of this is a self-help situation; without some competent experienced lawyer your plans will not do as well as they might do with professional help.
Finally, by hiring counsel at the beginning you will rest assured that your corporate lawyer will be there when (not if) many more serious problems arise.