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Business Formation

Crucial Questions to Ask When Starting a Business

Finding answers for legal & financial matters.

AUTHOR
Shaneequa Parker, Esq., MPA, MSW, CDP/CDE
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Key questions before starting a business

You’re launching a business because you have a vision. Maybe it’s a creative skill, a product idea, or a solution people need. But now you’re buried in terms like LLC, EIN, and 1099 and worried about potential tax mistakes that could cost more than your startup capital. Many entrepreneurs share your concerns, and luckily, you don’t need a finance degree or law license to move forward. You need clarity, not credentials. Thoughtful questions get you there.

This guide breaks down the questions to ask when starting a business so you can move from overwhelmed to empowered. You’ll find clear, low-cost steps, free resources, and real-world strategies to help you protect your business before a small issue becomes costly.

Ask First, Act Second: Why Questions Beat Guesswork

First-time business owners often rush to form a limited liability company (LLC), launch a website, or hire help before understanding the full picture. But knowing which questions to ask when starting a business, early and often, protects your time, money, and peace of mind. 

Better questions lead to better business decisions.

Essential questions new business owners should ask before launching

Legal Questions to Ask When Starting a Business

Structure, risk, and responsibility aren’t just startup buzzwords. They’re foundational questions that stand between your vision and avoidable legal messes:

  • What legal structure makes the most sense for me? Sole proprietorships are the easiest to start but offer no liability protection. LLCs, while slightly more complex, can shield your personal assets.

  • Do I need a business license or permit in my state or city? Licensing requirements vary widely. Some states require licenses even for online services.

  • What tax obligations will I face? Will you need to make quarterly estimated payments? Should you charge sales tax?

  • Do I need contracts for my clients or contractors? Yes. A handshake deal might feel simple until it unravels in court. A written agreement is your first layer of protection.

Asking these questions upfront can save thousands in penalties, legal fees, or back taxes.

Essential Questions to Ask an Accountant When Starting a Business

Even a one-time conversation with a CPA can uncover blind spots that Google can’t. Before your first call or consultation, here are thoughtful questions to bring with you:

  • How should I track income and expenses to prepare for taxes? Free tools like Wave or low-cost software like QuickBooks can help. Your accountant can recommend one that fits your needs.

  • What deductions can I legally take as a new business owner? From your home office to startup costs, many new founders miss legitimate deductions.

  • Should I elect S-corp status? S-corp election can reduce your tax burden, but it adds complexity. It’s best discussed with a tax professional.

  • How do I pay myself legally? Depending on your structure, you may need to take distributions, owner draws, or formal payroll.

  • What records should I keep, and for how long? The IRS typically recommends keeping records for at least 3 years, but payroll records and certain forms may need to be held longer. Your accountant can advise you on what is right for you.

A good accountant won’t just answer questions. They’ll help you ask smarter ones next time.

Beyond Legal and Financial: Other Important Business Questions to Ask

While legal and financial questions are critical, your inquiries shouldn’t stop there. A successful business requires a holistic approach. Here are other important business questions to ask yourself and others:

  • Who is my ideal customer, and what problem am I solving for them? Know who you’re helping, what they need, and why your solution matters to them.

  • How will I price my product or service to be competitive and profitable? Consider your costs, market rates, and perceived value when setting prices.

  • What are the most effective low-cost marketing strategies for reaching my target audience? Explore options like social media marketing, content marketing, email marketing, and local networking events.

  • What systems can I implement to streamline my operations as I grow? Consider how you will manage inventory, fulfill orders, or handle customer service efficiently.

Remember, seeking guidance isn’t an admission of not knowing. Don’t underestimate the importance of networking with other local entrepreneurs. Their experiences and insights can spark valuable business questions to ask yourself.

Looking for Resources? Start Online

The internet is a treasure trove of information to help you brainstorm. Free or low-cost resources to support you:

  • SCORE—offers free business mentoring

  • U.S. Small Business Administration—step-by-step startup guides and local assistance

  • U.S. Chamber of Commerce—access to webinars, events, and networking opportunities for small business owners

  • Local small business development centers (SBDCs)—often run free legal and accounting clinics

  • State economic development agencies—may offer grant programs or early-stage funding

These tools won’t replace tailored legal or financial advice but will help you ask better questions and make informed decisions.

New business owner reviewing legal and financial startup questions with a notebook and laptop

Robert’s Journey: Asking First, Winning Later

Robert had $1,200, a passion for smoothies, and zero legal background. Instead of winging it, he contacted a SCORE mentor and his local SBA office. He asked what licenses he needed, how to set up an LLC, and whether contracts were necessary. Within weeks, he had:

  • Filed his LLC online

  • Secured a local vendor permit

  • Found a free contract template for event organizers

By asking the right questions before acting, Robert avoided fines, licensing delays, and safety violations. Six months later, he was profitable and legally protected without hiring a lawyer.

Key Takeaway

Successful entrepreneurs aren’t the ones with all the answers. They’re the ones who keep asking the right business questions. To achieve long-term success and minimize legal issues, embrace curiosity, seek expert advice, and use the resources at your disposal.

Build a Smarter Company by Staying Curious

You don’t need to master tax law or business regulations before you start. You just need the courage to ask smart questions and act on the answers. Still unsure where to begin? Ask yourself: What don’t I know yet, and who can help me figure it out?


Ready to go from confused to confident? Bizee helps you form your business and stay compliant without breaking the bank. We’re here to help you ask better questions and build a lasting business.


Resources:

  • Small Business. U.S. Chamber of Commerce, link

  • Choose a business structure. U.S. Small Business Administration, link

  • Operating a business. Internal Revenue Service, link

  • 9 Questions Smart Entrepreneurs Answer Before Starting a Business. Score (2019), link

Successful entrepreneurs aren’t the ones with all the answers. They’re the ones who keep asking the right business questions.

Key Takeaways


• You don’t need credentials to launch a business—just the courage to ask the right questions.

• Rushing into forming an LLC or hiring help without clarity can lead to avoidable legal and financial pitfalls.

• Choosing the right legal structure protects your assets and affects taxes, risk, and responsibilities.

• Many states require licenses or permits—even for online or home-based businesses.

• Written contracts with clients and contractors are essential legal protection, not optional paperwork.

• Consulting a CPA early can reveal hidden tax deductions, filing needs, and smart ways to pay yourself.

• Asking about recordkeeping and expense tracking helps prevent IRS issues down the road.

• Knowing your ideal customer, pricing strategy, and marketing plan are just as important as legal setup.

• Free resources like SCORE, SBA, and local SBDCs offer valuable support, mentorship, and templates.

• Curiosity and strategic questions build stronger businesses than blind confidence or guesswork.

Shaneequa Parker, Esq., MPA, MSW, CDP/CDE
Shaneequa Parker, Esq., MPA, MSW, CDP/CDE

Shaneequa Parker, JD, MPA, MSW, CDP/CDE, has more than 15 years of experience working in the social service and nonprofit fields, as well as professional cosmetology experience. She serves as the Vice President of Compliance and Legal Affairs for a New York City-based nonprofit organization. Managing the organization's compliance and professional development activities feeds her passion for helping others grow professionally and creating nurturing networks and connections.

Shaneequa is a graduate of CUNY School of Law (JD), John Jay College (MPA), and Hunter College's Silberman School of Social Work (MSW). She is also a Certified Diversity Executive/Professional (CDE/CDP). In her free time, Shaneequa enjoys exploring new restaurants, watching true crime shows, and listening to 90s hip-hop.

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