How To Avoid Getting Sued as a Business (Compliance Expert Explains)

Taxes: a topic that can make even the savviest entrepreneurs cringe. But let’s face it—understanding and complying with tax regulations is an essential part of running a successful business, whether you're just starting out or scaling globally.

So how do you simplify something so complex? The answer lies in staying informed, using the right tools, and taking a proactive approach. Let’s break it down.

Compliance Is Key

According to Reuben Mattinson, one of the biggest mistakes entrepreneurs make is opting for ignorance. “Start early,” he says. “The cost of getting it right upfront is typically small compared to the potential consequences later.”

For instance, if you're an online seller, you might assume you only owe sales tax in your home state. But in reality, economic nexus laws across the U.S. mean you could owe taxes in multiple states based on where your customers are. Staying ahead of these obligations can save you from hefty fines and business interruptions down the road.

The Right Tools for the Job

Sales tax compliance doesn’t have to be overwhelming. Tools and services can help you assess your liabilities and streamline your tax processes.

For e-commerce businesses, platforms like Amazon may handle some of the tax collection and remittance for you, but others, like Shopify, require you to take the reins. Understanding the differences and adjusting your settings accordingly is critical.

Pro Tip: Don’t overcompensate by applying sales tax to every state when it’s unnecessary. This can inflate your prices and drive customers away.

Global Considerations

For non-U.S. entrepreneurs, tax compliance takes on a whole new dimension. Setting up a U.S. LLC in a tax-friendly state like Wyoming or Delaware can provide protection and cost advantages. However, be aware of double taxation treaties between countries to avoid unnecessary payments.

As tax treaties evolve and the U.S. becomes more aggressive in enforcing its rules, staying updated on international requirements is more important than ever.

Final Thoughts

Taxes don’t have to be intimidating. By starting early, using the right tools, and keeping an eye on evolving regulations, you can make taxes work for your business—not against it.

Whether you're striving to make your first million or scaling to new heights, staying compliant ensures that your financial foundation is solid. Take it from Reuben: “Don’t be victimized by your own ignorance. Get informed, take initiative, and keep your business on the right path.”

Have questions about taxes or need a consultation? Visit RJM Tax Exemption to get started on simplifying your tax journey.