Setting your business up legally

Hi friend!

LEGAL + TAXES. The two main headaches we face as business owners, am I right?! I’m going to brush on the basics in this blog post.

There are a lot of ways you can set up your business legally, but the 2 main ways people typically choose in the beginning are an LLC or Sole Proprietorship.

The difference?

1. LLC stands for Limited Liability Company meaning your personal assets are protected.

2. If you choose to be a Sole Proprietor, it’s cheaper to set up in the beginning but all of your personal assets (house, cars, kids’ college funds, etc.) are at risk if you were to ever get sued. You and your business are essentially the same person.

And some extra info for ya if you’re not just starting out:

If you’re making $40k or more per year, you may want to talk to your accountant about becoming an LLC that’s taxed as an S-Corp to avoid double taxation. I made this switch a few years back and save on taxes every year!

If you have any questions about setting up your business or would like to get your contracts reviewed/written up, The Creatives Counsel is a great + affordable resource!

In the beginning of my business I paid $500 for an hour long meeting with a lawyer, and wish I would’ve known about Wynne from the Creatives Counsel!

If you’re looking to set up your business legally, type into Google “Your State Business Formation” or for example, “Minnesota Business Formation” and find the option for your state’s website. Here is a link to Minnesota’s.

As always, reply with any questions you may have! 
 

xoxo,

Ali Leigh

P.S. If you’re farther along in your business and are considering starting an associate team, my online course Build an Associate Photography Team will cover the details of setting your team up legally and what you need to know for tax season.