“You know you are on the road to success if you would do your job, and not be paid for it.”
Beginning a photography business presents amazing opportunities. The people you will meet, travel, and search to capture 1,000 words with a single shot are exciting pursuits. New business owners, entrepreneurs, and freelancers often face legal challenges in the initial business phases. Do you pay thousands of dollars to a lawyer to help? Or should you rely on generic online forms and misinformation floating around on the web? Look no further for help starting your business.
Below are helpful explanations of just some of the legal issues you will face starting your business. As a business owner, you not only need to comply with legal issues, but you also need to understand many of the legal issues involved in starting a business. Inevitably, you will need the help of a trusted lawyer as your business grows, but for many it’s an unnecessary upfront expense. Basic legal information is also incredibly useful for a business owner.
As business lawyers we’ve worked to create an affordable way to provide you with the legal information and documents you need to begin your company. Below are some of the issues covered in our StartUp, Legally course. And, we do so in a way that you can easily digest (think: checklists, templates, and videos).
SELECTING A BUSINESS ENTITY
But why not get paid to take amazing photographs of those you love and new friends along the way? For a photographer choosing the correct business entity is imperative to the success of your business. Liability protection, taxation, and management operations are some of the more prominent differentiating factors of each type of business entity and should always be considered. This depends on whether or not you want to maintain photography contracts or operate in a more freelance style of photo taking. Regardless of the form of business a photographer selects, one way to start your company off with the proper management tools is by drafting a quality agreement between the founding partners and maintaining proper contracts for clients or event planners.
A sole proprietorship is the most basic form of business entity that starts by an individual conducting business. Partnerships allow for a vast number of options to fit a particular business’s specific needs. As a photographer you may need to involve other individuals who have the same photo-taking abilities as yourself. Many states also have limited partnerships (LP), which require at least one general partner and one limited partner. Limited Liability Partnerships (LLP) offer partners liability protection, meaning partners are generally not liable for the negligence of other partners. Limited Liability Companies (LLC) offer owners the ability to operate the company without rigid rules associated with a corporation while affording great liability protection and flexible tax options.
An LLC may be the best way for a photographer to have flexibility in their business while being protected by the rules that govern a company. The operating agreement of an LLC can be a great tool because it affords flexibility, allowing a photographer to define the scope of their business. Maybe you would like to be a photographer that takes photos for professional headshots, engagements, or only professional sporting events, an operating agreement can limit the scope of your professional photography from your leisurely photography. Be in control of your photos, filters, and clients with a proper operating agreement.
TRADEMARKS FOR YOUR BUSINESS
Don’t spend two years establishing strong client base before learning your photography company is infringing on another’s trademark. Do research on the name and trademark your photography company is attempting to use. It is highly encouraged that businesses follow through and trademark their mark with the United States Patent and Trademark Office, especially in a highly competitive artistic industry where it can be difficult to distinguish one style from another. A trademark is a sign, design, or expression that identifies products or services from a particular source. A registered trademark symbol is ®.
Trademark registration is a great way to safeguard to building a brand that you can protect for years into the future. We encourage all businesses that are building goodwill with their brand to consider taking the steps to register their marks. Even if a company has not registered a trademark, they may still have rights associated with their use of the name or slogan. There are a lot of considerations when a business is currently using the mark you desire, so we recommend that you contact an attorney to ensure that your desired mark is available for use and registration.
Photography contracts come in all types depending on the type of photos you take, the edits / filters you may use, and the locations you want to shoot at. Understanding the underpinning of contract law is vital for all business owners. Business contracts include any agreement between two or more people in which something of value is exchanged. Usually one person agrees to perform a service or deliver a good in exchange for valuable consideration, such as money. As a photographer, you do not want to spend your time traveling to a location to take and edit photos of people who may never pay you. Protecting yourself with a full and actionable contract will ensure that you are paid for your time and effort. It is prudent to have all clients sign a contract, no matter how close to you they may be. Having a company policy mandating written contracts forwarded to clients from verbal contract agreements may be a prudent way of enforcing this policy.
OBTAINING AN EIN NUMBER AND OTHER TAX INFORMATION
To obtain an EIN number online, the principle place of business for your entity must be located in the United States or a U.S. Territory and the photographer applying must have a valid Taxpayer Identification Number. EIN numbers are limited to one person who exercises ownership control per day. Employer Identification Numbers are issued for the purpose of tax administration and are not intended for participation in any other activities. EIN numbers may be obtained through IRS.gov and take less than fifteen minutes with all the proper information. This is especially important if you obtain the help of other skilled photographers to execute your event contracts. Publication 15 provides information on employer tax responsibilities related to taxable wages, employment tax withholding and which tax returns must be filed. Publication 15 can be found on IRS.gov as well. More complex issues are discussed in Publication 15-A and tax treatment of many employee benefits can be found in Publication 15.
Every city and state dictates the terms by which business must operate. As a photographer you must consider all of the locations you are willing to shoot at. All businesses, virtual, and home and otherwise, must comply with local ordinances and laws. Most of the time, it is a matter of registering, paying local taxes, and having a registered trademark or copyright on your photos. Contact your local government for further information.
Don’t let legal cost prevent you from chasing your dreams and building the business you deserve. Basic legal concepts for opening a business are easy enough to grasp with the right training. Let StartUp, Legally guide you through the proper steps without spending thousands on hiring a lawyer.