With all the other startup expenses new business owners may be juggling, hiring a small business attorney may seem like a luxury they can’t afford. However, having a reliable legal partner to offer advice and manage your legal obligations can help you avoid frustrating paperwork mistakes at best and expensive lawsuits at worst.
Here’s everything you need to know to find a suitable small business attorney for your needs, along with some low-cost legal resources if you can’t afford to retain ongoing counsel.
What is a small business attorney?
A small business attorney is a legal professional who exclusively represents small businesses and their owners. Otherwise referred to as corporate or commercial lawyers, these professionals can guide small business owners through any legal processes they may encounter while establishing and maintaining their businesses.
While some lawyers consider themselves “general business attorneys” who can advise on a wide range of legal matters, some small businesses may need specialized support from an attorney with experience representing clients in court or dealing with highly specific legal regulations. Here are a few specialty types of business attorneys you might consider hiring.
Employment and labor attorney
If your small business has employees or is planning to hire them, an employment and labor lawyer can help you stay compliant with local and state labor laws. They can also protect your business from wrongful terminations and workplace discrimination lawsuits.
[Read more: 10 Legal Requirements for Hiring Employees]
Merger and acquisition attorney
Before merging with another business or arranging an acquisition, it’s important to consult with a merger and acquisition (M&A) lawyer. Business owners may not fully understand their obligations, leaving room for the other party to negotiate a deal in their favor. An M&A attorney can help you through the transaction to ensure fair negotiation.
Tax attorney
As a small business, you’re required to pay state and federal taxes. These tax requirements can get confusing and lead to mistakes. A tax lawyer can help you remedy these mistakes if the IRS takes legal action or decides to audit your tax return.
Contract attorney
If you’re making a business deal that requires a written agreement, a contract lawyer can help you review the other party’s document and ensure it’s as fair as possible for your business. This type of attorney can also help you draft legally sound independent contractor agreements with any vendors you may hire or clients who may hire you.
Intellectual property attorney
This lawyer will help protect any trademarks, copyrights, or patents your small business holds. They can also help you avoid costly legal issues and lawsuits related to IP infringement by ensuring compliance with IP laws.
[Read more: Protecting Your IP: A Guide for Small Businesses]
What are the benefits of having a small business attorney?
Having a go-to attorney can not only help you navigate the legal aspects of your business but also ensure your protection throughout the process.
“A small business [must have] the right representation to ensure that the person who owns the business is legally protected, both personally and professionally,” explained Jennifer Schenker, Attorney and Partner at Tarter Krinsky & Drogin, LLP. “In the event that a business owner guarantees anything financially, as a personal guarantee on behalf of the business, then that person would be deemed personally liable.”
In the early stages of your business, a small business attorney can ensure it’s structured properly and legally compliant. They can also advise on everyday business matters, tax issues, and startup operations.
As your business grows, a small business attorney helps protect your assets, including cash and property. They ensure that your employment agreements are solid and fair and can create contracts for employees, clients, and vendors. If disputes arise, they can also handle contract enforcement.
Should your business need representation, a small business attorney can help you navigate the legal process. They offer support during bankruptcy too, helping you overcome financial challenges by determining the best course of action.
Just because an attorney may be good does not mean that they are the right attorney for you. Hire an attorney that [you] are comfortable with and can trust.Jennifer Schenker, Attorney and Partner at Tarter Krinsky & Drogin, LLP
When do you need a small business attorney?
While many entrepreneurs only seek legal advice when a problem arises, consulting an attorney early can help you avoid costly mistakes and protect your business as it grows.
Here are some of the most common situations where a general or specialized business attorney can help:
- Choosing and forming a business entity. An attorney can explain the legal implications of operating as an LLC, corporation, partnership or sole proprietorship and help prepare or review the necessary formation documents.
- Drafting and reviewing contracts. Whether you're signing a lease, negotiating with a vendor or bringing on a new client, an attorney can help ensure agreements protect your interests.
- Creating internal business documents. Operating agreements, partnership agreements, shareholder agreements and corporate bylaws should clearly define ownership, responsibilities and decision-making processes.
- Buying or selling a business. Legal guidance can help you navigate due diligence, negotiate terms and complete the transaction while minimizing risk.
- Responding to legal disputes or demand letters. Even if a lawsuit hasn't been filed, an attorney can advise you on the best course of action and help resolve disputes before they escalate.
How much does a small business attorney cost? Hourly rates, retainers, and flat fees explained
The cost of hiring a small business attorney typically depends on the attorney's experience, practice area, geographic location, and the complexity of your legal matter. Most business attorneys use one of three fee structures:
- Hourly rates. Many attorneys bill by the hour for ongoing legal work, negotiations or complex matters that are difficult to predict. Average hourly rates for small business attorneys range from about $150 to $400 per hour, although rates may be significantly higher in large metropolitan areas or for highly specialized attorneys.
- Flat fees. For routine legal services with a clearly defined scope—such as forming an LLC, drafting a basic operating agreement, registering a trademark or reviewing a standard contract—many attorneys charge a fixed fee. This pricing structure makes costs more predictable and easier to budget for. Depending on the attorney’s location, experience, and specific legal issue, you can expect an average flat fee of $200 to $2,500 per project.
- Retainers. For businesses with ongoing or complex legal needs, attorneys may charge a monthly retainer and bill against it as work is completed. This arrangement can be a good fit for businesses that expect to need regular legal advice throughout the year. Average retainer costs can range from $1,000 to $5,000 per month.
Before hiring an attorney, ask how they bill for their services, what expenses are included in their fees and whether they can provide an estimate for your specific legal matter. Understanding the billing structure upfront can help you avoid unexpected costs later.
Where to look for a small business attorney
One of the best ways to retain a lawyer suitable for your small business is through network referrals. Talk to other small business owners or colleagues within your network and ask them to refer you to a lawyer they may have used in the past or are currently working with. Be sure to ask your connection when and how they worked with this lawyer to determine if they’re the right fit for your business.
Another way to look for a small business lawyer is through online resources, including social media platforms such as LinkedIn. Lastly, online services and directories can connect you to a local lawyer in your area based on your legal needs.
Considerations and questions to ask before hiring a small business attorney
Once you’ve determined your business’s needs, there are a few questions to consider in your search:
- How many years have they been in practice?
- Who will handle your case?
- Where are they located? If they’re far away, are they willing to travel?
- How often do they handle the issues you’re hiring them to deal with?
- What issues do they specialize in?
- Can I talk to existing clients with similar needs or business structure as me?
- What size is the law firm and can it scale with me? Conversely, if it’s already large, does it have enough time to help me with my issues?
- Are they willing to go to trial, or will they try and settle?
- What are their fees and billing structure?
- Do they have financial arrangements that suit my business’s finances?
Schenker recommends directly interviewing any potential attorneys to ensure you are comfortable with them. During the vetting process — and before signing any contracts — ask your potential attorney any questions you have to ensure you have all the information you need to make an informed decision.
“Just because an attorney may be good does not mean that they are the right attorney for you,” she said. “[You need] to hire an attorney that [you] are comfortable with and can trust.”
Can’t afford ongoing counsel? Low-cost legal resources for businesses
Many entrepreneurs don’t need an attorney on retainer. If your budget is limited and your business doesn’t have complex ongoing legal needs, consider these lower-cost alternatives for basic legal guidance:
- Small Business Development Centers (SBDCs). Many SBDCs offer free business counseling and can connect entrepreneurs with legal education, workshops, and local resources.
- SCORE. SCORE mentors often provide free guidance on a wide range of business topics and may be able to refer you to trusted legal professionals in your area.
- Legal aid organizations and law school clinics. Some nonprofits and university law clinics offer free or reduced-cost legal assistance to qualifying small businesses, startups, or entrepreneurs.
- Limited-scope legal services and online platforms. Some business attorneys offer one-time consultations, contract reviews, or other "unbundled" legal services, allowing you to pay only for the specific help you need rather than ongoing representation. Similarly, online platforms like LegalZoom and Nolo offer low-cost options for creating and filing common legal business documents as well as lawyer directories and chat services for one-off questions.
While these resources can be valuable for routine questions and preventive guidance, complex legal matters—such as litigation, regulatory investigations, or high-value business transactions—are generally best handled by an experienced business attorney.
Lauren Wingo and Miranda Fraraccio contributed to this article. Some source interviews were conducted for a previous version of this piece.
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