In this episode, Jared shares his experience getting started with his gigging act - and answers the question of “do musicians need an LLC when they’re getting started?”
What's up musicians? It's Jared and today I want to answer a question about LLCs that I get asked fairly often. Before we dive in this episode is brought to you by gigging secrets, the underground playbook to making a living as a performer, get your copy at gigging secrets.com. Alright, so I've seen this question quite a bit on some of the Facebook groups for musicians. And also I get asked this question a couple of times per month, which is, do I need an LLC when I'm just starting out with my gigging group? So, before I answer it, I first have to give a preface that I'm not giving business advice. I am not a lawyer, I am not an accountant. So, you know, this is not official advice. This is just my experiences. I have been running my LLC dream city music since 2016. And when I first started, I actually did get an LLC. So what is an LLC? An LLC stands for limited liability company. And it essentially is it is a company it is a recognized entity, by your state, you've typically have to file it with your state's Department of Financial institutions. And you also get an Ei n number from the IRS for when you file taxes. And so basically, when you your band or your your gigging act makes money, you get a bank account specifically for that, which you typically can't do, unless you have an LLC. But the money goes into your bank, your band's bank account. And then when you file taxes at the end of the year, that's when you report all of your earnings and all of your expenses to the IRS using your bands, LLC, Li, the Ei n for the LLC. And when you're getting started, that kind of stuff is actually the least of your worries. You know, the the real question is, when you're getting started, how do you start making money first, because if you're making a living from you're performing, then there's money involved. But there's no sense in worrying about how you're going to report that money to the IRS until you actually start making it. So if I were to start over again, with nothing, would I start out by getting an LLC? No, I wouldn't worry about that. First, I would prove to myself and to my market, that my music is desirable enough for people to pay me money, and book gigs for it. And then, you know, I would file that under my own social security as a sole proprietor. And then eventually, as I booked enough gigs and started this scale, where I had a lot of expenses, and it was getting complicated, that's when I would start to separate it out, and not use a personal account, and reduce my risk. Because, you know, having an LLC, the definition of limited liability company means it limits your liability. So that when, if something bad happens, and you get sued, they're suing the company, not your personal, you know, not you as a person. So that means that you're you're sheltered your personal assets are sheltered from from liability from risk. So, yeah, but, you know, it's not necessary to think about that when you're getting started. Because what if you get you spend money on an LLC, you get an accountant, you get all the documents drawn up, you pay your filing fees with your state, and then you don't get any books, don't get any gigs booked. You know, you just wasted a ton of money, you wasted a ton of time going through administrative processes, only to essentially have your company start out bankrupt. So I wouldn't I wouldn't go that route, I would just focus on figuring out you know, the game secrets process. The first step is positioning yourself for gigs that pay, specifically ones that will pay you enough. And then learning how to sell those gigs. And then getting yourself out there in front of enough people and market yourself so that you can start to book gigs and put money through your gigging act, you know, just put the put the fuel in the engine there. Don't necessarily worry about how are you going to pay tolls at the end. So that's just my two cents. Again, I'm not a lawyer. I'm not an accountant. This is not legal or business advice. So consult with your own accountant or lawyer and make your own decisions. But those are my experiences. And I hope that that answers your question and helps you out. And if you got any value out of this, make sure to subscribe to the podcast, share it. And again, if you are interested in learning how to make a living With you're performing, go ahead and get your copy of gigging secrets. It's my new book. That's the underground playbook to making a living performing. It is available at gigging secrets.com thanks so much for listening and may all your performances be spectacular.