An Interview With Chad Silverstein
One of the most common and costly tax mistakes business owners make is misclassifying employees as independent contractors. Many business owners do this in an attempt to avoid the administrative burden and costs associated with payroll taxes, unemployment insurance and workers’ compensation. However, this misstep can have serious financial and legal consequences.
In today’s fast-paced business world, the complexity of legal matters can often be overlooked, leading to significant repercussions for businesses of all sizes. From startup ventures to established corporations, the absence of legal guidance can result in critical errors that affect growth, operations, and sustainability. These mistakes range from issues with contracts and intellectual property to compliance and employment law, each carrying the potential for financial loss and reputational damage. I had the pleasure of interviewing Jason Wiggam.
Jason Wiggam is a founding partner of Wiggam Law in Atlanta, Georgia, where he specializes in tax controversies, representing individuals and businesses in complex IRS and state tax matters. With extensive experience in syndicated conservation easements, micro-captive insurance disputes, and various IRS settlements, Jason has built a reputation for navigating challenging tax issues. Recognized for his expertise and dedication, he has earned accolades such as Georgia Trend’s Legal Elite and Super Lawyers Rising Star honors.
Thank you for joining us. To start, could you share your “origin story” with our readers? How did you begin your career? What challenges did you face in the early days? How did you overcome them?
My journey into the legal field began with a strong desire to help people navigate complex and often intimidating challenges. Early on, I discovered that tax law was an area where I could truly make a difference. I saw how overwhelming tax issues could be for individuals and small businesses, and I wanted to be the advocate they needed to find solutions.
Starting my own firm, Wiggam Law, came with its share of challenges. Like many entrepreneurs, I had to build a reputation from the ground up and establish a client base in a highly specialized field. Those early days were filled with a relentless focus on understanding the unique needs of my clients.
To overcome these hurdles, I made transparency, integrity and exceptional service the foundation of my practice. I stayed ahead of changes in tax law, leaned into my network and remained committed to building strong relationships within the legal and business communities. Today, I’m proud to say that Wiggam Law reflects my belief that with the right guidance, even the most overwhelming tax issues can be resolved.
Is there a particular book that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
Traction by Gino Wickman
Law school equips you with the knowledge to practice law, but it does not teach you how to operate a law firm. Running a successful law firm is just as much about being a capable business owner as it is about being a skilled attorney. I discovered Traction during a pivotal moment in my career when I was struggling with the operational side of running my firm.
The book explains the Entrepreneurial Operating System (EOS), which is a practical framework for managing and growing a business. What stood out to me most was how actionable the advice was. I implemented EOS in my firm in 2019, and it transformed how we operated — from goal setting and team alignment to client service. It taught me that systematizing even the smallest processes can lead to remarkable results. Today, EOS remains the backbone of how we run our law firm and ensure its continued growth.
Do you have a favorite “Life Lesson Quote”? Do you have a story about how that was relevant in your life or your work?
“Perfection is the enemy of progress” — Winston Churchill
This quote resonates deeply with me as an entrepreneur and business owner. Early in my career, I held back from starting my own law firm because I felt I needed everything to be meticulously planned and perfect. I kept delaying, fearing failure. Eventually, circumstances forced me to take the leap, and in hindsight, I’m grateful I did. The process of starting, launching, and growing my law firm proved the truth of Churchill’s words. Waiting for perfection would have paralyzed me. Instead, I learned that progress often comes from trial and error and that mistakes are opportunities to grow.
Through this lesson, I’ve cultivated a culture in my firm that values taking action and learning from experience over striving for unattainable perfection. This philosophy has been a cornerstone of our success.
How have you used your success to make the world a better place?
In terms of giving back, I’ve used my success to contribute to causes that matter to me and my team. As a firm, we donate monthly to charities selected by our employees, giving them a chance to champion causes they are passionate about. Personally, I’ve increased my charitable contributions to organizations addressing homelessness, supporting environmental initiatives, helping sick children, and more. We also fund scholarships at my alma matters, Georgia State University and Clemson University, supporting the next generation of leaders. Additionally, by growing our firm from a small practice in Atlanta to one serving the Southeast, we’ve created jobs, opportunities and resources that positively impact our community.
Ok, let’s now turn to the central part of our interview. What is the most common legal mistake you see businesses make due to the lack of proper legal counsel, and what are its potential consequences?
The most common mistake I see businesses, particularly entrepreneurs, make is attempting to act as their own legal counsel. Often, this stems from either overconfidence in their abilities or concerns about the cost of hiring an attorney. However, they frequently underestimate the complexity of legal issues and end up making errors that could have been avoided.
For example, I’ve seen business owners draft their own contracts or attempt to resolve tax disputes themselves. These efforts often lead to unintended consequences, such as legally binding themselves to unfavorable terms or missing critical deadlines. In the end, these mistakes typically cost far more to fix than what they would have spent hiring an attorney in the first place. Proper legal counsel is an investment, not an expense, and it can save businesses from costly and sometimes irreversible errors.
Can you share an example where early legal intervention could have significantly altered the outcome of a business dispute or challenge?
My firm specializes in resolving tax problems for individuals and businesses. One of the most common examples I see involves clients with unfiled tax returns. Imagine a client who hasn’t filed returns for ten years. They decide to address the issue and hire a CPA to prepare all ten years of missing returns. The CPA completes and files the returns, and then the client approaches us for help with the resulting tax debt.
Unfortunately, at this point, I have to deliver bad news: Under IRS policy, they typically only require the last six years of tax returns to be filed. Filing all ten years means the client has unnecessarily overpaid taxes for four years — money they’ll likely never recover.
Had the client engaged our firm earlier, we could have provided guidance on the IRS’s filing requirements and worked with the CPA to prepare only the necessary returns. This would have saved the client significant time, effort and money. This example illustrates why consulting legal counsel at the outset of any business or tax issue can be invaluable.
In your experience, how does the absence of legal counsel impact a business’s approach to contracts and negotiations, and what advice would you give to mitigate these risks?
My practice does not focus on business contracts and negotiations, so I do not feel qualified to answer this question.
What legal pitfalls do new businesses often overlook during their initial setup and growth phases, and how can they proactively address these issues?
Entrepreneurs starting a new business often overlook critical steps during the initial setup and growth phases. This can lead to costly mistakes that are easily avoidable with proper legal guidance.
One common pitfall is choosing the wrong business structure. For example, a business owner may default to a sole proprietorship without considering the personal liability risks or form a corporation without understanding the tax consequences. A subchapter C corporation, for instance, subjects the business owner to double taxation — once at the corporate level and again on distributions — which is often the least favorable tax outcome for entrepreneurs. Opting for a Limited Liability Company (LLC) or an S corporation may offer more flexibility and tax advantages, but these choices require thoughtful analysis with legal and tax professionals.
Another frequent oversight is relying on verbal agreements among founders instead of formalizing their arrangements with a partnership agreement, operating agreement, or shareholder agreement. These legal documents outline ownership, roles, decision-making processes and dispute resolution mechanisms, significantly reducing the likelihood of costly conflicts or misunderstandings down the road.
Tax compliance is another area where new businesses often falter. Entrepreneurs may fail to register for an Employer Identification Number (EIN), neglect to collect and remit sales tax properly, or mishandle payroll taxes for employees. These errors can trigger penalties, audits and significant financial liabilities.
Each of these pitfalls can be avoided by engaging competent legal counsel early in the process. A knowledgeable attorney can guide business owners through these critical decisions, helping them establish a solid foundation for long-term success while avoiding unnecessary legal and financial risks.
Could you list and briefly explain “Top 5 Mistakes Businesses Make Without Legal Counsel” based on your experiences and insights?
1 . Choosing the Wrong Business Structure
Entrepreneurs often choose a business structure without fully understanding the legal and tax consequences. For example, a sole proprietorship may expose the owner to unlimited personal liability, while a corporation formed without proper tax advice could result in double taxation under subchapter C rules.
Example: I once worked with a business owner who formed a corporation but failed to elect S-corporation status for five years. The result? They were taxed at both the corporate and individual levels on distributions, significantly reducing their profits. We were able to request a late S-corporation election which allowed the owner to file as a S-corporation for the last three years only. If they had consulted a tax attorney, they could have chosen an LLC or elected S-corporation status, avoiding unnecessary taxes earlier.
2 . Neglecting Formal Agreements Among Founders
Many business owners rely on verbal agreements or informal understandings instead of drafting partnership agreements, operating agreements or shareholder agreements. This often leads to disputes over roles, responsibilities and ownership.
Example: A business partner contacted me because he received a Form K-1 allocating significant income to him when he had not received any distributions. This caused him a large tax liability that he could not pay. I was able to assist him with the issue by negotiating with the IRS and referring him to a business litigation attorney to negotiate with his partners. Unfortunately, the business did not have an operating agreement, so costly litigation was necessary for the partner to obtain the missing distributions. He could have avoided this headache and stress if the business had a written operating agreement that clearly outlined how distributions would be handled.
3. Mishandling Tax Compliance
New businesses often overlook key tax obligations, such as registering for an Employer Identification Number (EIN), collecting and remitting sales tax or properly withholding payroll taxes. These oversights can result in penalties, audits, and financial strain.
Example: A small e-commerce business I worked with neglected to collect sales tax from customers in states where they had a tax nexus. When the state tax agency caught up with them, they were assessed back taxes, penalties and interest totaling tens of thousands of dollars. If they had sought legal and tax advice early on, they could have registered properly and avoided this costly mistake.
4 . Misclassifying Employees as Independent Contractors
One of the most common and costly tax mistakes business owners make is misclassifying employees as independent contractors. Many business owners do this in an attempt to avoid the administrative burden and costs associated with payroll taxes, unemployment insurance and workers’ compensation. However, this misstep can have serious financial and legal consequences.
Example: I worked with a small business owner who classified all their workers as independent contractors, believing it was a simpler and less expensive option. Unfortunately, an IRS audit determined that these workers were legally employees based on factors like the control the business had over their schedules and work methods. As a result, the IRS assessed the business for unpaid payroll taxes, penalties and interest, amounting to tens of thousands of dollars. This liability nearly drove the company out of business.
5 . Ignoring Estimated Tax Payments
Entrepreneurs often forget to make quarterly estimated tax payments, especially if they’re new to self-employment or operating pass-through entities like LLCs or S corporations.
Example: One client launched a profitable consulting business but did not pay estimated taxes throughout the year. When tax season arrived, they were hit with a large tax bill they hadn’t budgeted for, plus penalties for underpayment. Had they engaged legal or tax counsel early, they could have planned for these payments, reducing both financial strain and penalties.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good for the greatest number of people, what would that be? You never know what your idea can trigger.
I would inspire a movement focused on financial education and empowerment. In the United States, we have countless opportunities to improve our lives, but so many people miss these opportunities simply because they lack a basic understanding of how to manage their finances. Simple concepts — like spending less than you earn, creating and sticking to a budget and building an emergency fund — are foundational to financial security but are often overlooked or not taught at all.
Personally, I didn’t start my law firm until I felt my personal finances were in a place where I could do so responsibly. Having that financial stability gave me the confidence and freedom to take the leap. If more people were equipped with a solid financial foundation, they could break free from financial stress, take risks, start businesses and pursue their dreams. This movement could unlock the potential of millions of people and positively transform lives, communities and the economy as a whole.
As we wrap up, how can our readers follow your work?
- Website: Visit Wiggam Law to learn more about our services and read helpful resources on tax resolution and related topics.
- LinkedIn: Connect with me on LinkedIn for updates, insights and professional content.
Thank you for these fantastic insights. We greatly appreciate the time you spent on this.
About the Interviewer: Chad Silverstein is a seasoned entrepreneur and Thought Leader with over 25 years of business experience. He has founded, operated, and exited multiple companies and now builds into a handful of high impact CEOs. Chad has launched multiple online communities, including a recent leadership development platform, and also serves as a strategic advisor for Authority Magazine’s thought-leader incubator program.
To learn more and connect with Chad visit: chadsilverstein.io
Jason Wiggam Of Wiggam Law On The Top 5 Mistakes Businesses Make Without Legal Counsel was originally published in Authority Magazine on Medium, where people are continuing the conversation by highlighting and responding to this story.