Here are 10 steps that North Carolina business owners may take to reduce the risk of personal liability in owning a business:

  1. Establish a legal entity.
  2. Sign contracts in the name of the legal entity.
  3. Follow corporate formalities, as required by law.
  4. Keep business bank accounts separate from personal bank accounts.
  5. Obtain all necessary business licenses and permits, and file Certificates of Assumed Name, if required.
  6. File annual reports and pay required annual fees to the North Carolina Secretary of State.
  7. Obtain required and additional insurance policies for the business.
  8. Create a written plan for the business in the event of deadlock, disability, divorce, or death.
  9. Use well drafted contracts, invoices, and purchase orders in operating the business.
  10. Have a company handbook with policies and procedures.