VidOpp,
I’m looking to start up a videography business. How should I go about licensing and such? Should we go with an LLC structure to begin with? Or should we start getting clients before any of that? I have no idea where to begin! Please help…
Heather
Hi Heather,
I have some perspective on your question. The main reason to register an LLC is to protect your assets in case your business gets sued. If you are already poor and have nothing to lose like me, the LLC is not necessary. However, if you own your home or have a large amount of savings, you could lose it all if your business is liable for some problem. An LLC shields you from personal responsibility in case of a business failure or law suit.Personally, with little to lose, I do business under my own name and take any income on my taxes as self-employed cash income. When companies pay me I often have to give them a 1099, so they pay me as an independent contractor. I have had no trouble with this arrangement so far.
If your business grows, and you start to get a valuable set of professional equipment, a company car, and money in the bank, then it will be important to create a legal entity to keep the business separate from your personal assets.
That is my perspective - we have many, many entrepreneurial members in the community and I would be interested in hearing their perspective too.
Best regards,
Douglas
What should you do in the early days of working as a professional videographer?
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3 responses so far ↓
1 Jason // Aug 23, 2008 at 8:19 pm
Definitely more opportunities working directly with clients!
2 Matthew Galvin // Aug 24, 2008 at 11:46 am
Business plan first, then marketing plan, then get clients.
When you have made more than $10,000 and are pulling in more than $2,000 per week, talk to an accountant about a capable corporate structure.
If you are planning on hiring other people to work for you, be very wary of the 1099 status . . . independent contractors MUST have their own tools and cannot legally operate your cameras and equipment. A couple of local businesses have been slapped for this one.
Otherwise, pay them under the table or pull out the payroll taxes.
3 Marina Martin // Aug 25, 2008 at 5:14 am
The business entity you choose has a lot to do with the state you reside in. Many states allow you to be an LLC and pay taxes just as though you were an individual. An S-corporation allows you to pay taxes as an individual, as well. (C-corporations must file their own taxes.)
Registering as an LLC is usually less than $100. Forget not having assets - if there’s an accident on a shoot, even if it’s 100% not your fault, you can still be sued, and they’ll take whatever they can get. Liens on your paycheck, etc. Not worth the risk. Plus, being a real company makes you look more professional to real clients.
Don’t forget insurance!
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