Starting a photography business is exciting but properly setting up business is so super important!
We need to make sure you’re on the right path!
This high-level checklist is great for EVERYONE.
- The hobbyist considering going legal
- The newbie wanting a guide
- The advanced photographer running their yearly audit
These are the steps you need to make sure you have on lock-down to have a professional and protected photography business.
Let’s get started.
#1 Choose a legal name
What do we mean by that? Can’t I just pick the name I want?
Yes AND NO!
You want to make sure you’re not violating any Federal or State trademarks, as well as ensuring your name is available. Don’t want to get kicked out of business for a mere issue with name. Or worse, have to hand over all of your profits for the time you were using someone else’s name. PLUS you’d have to rebrand in the end.
- Search the USPTO office
- Search your local State website
- Google (but don’t rely on people’s SEO)
- Check social media handles
- Hire a firm to do the proper searches for you
Let’s make sure we don’t spend time + money + energy building a business on a name that we aren’t legally allowed to use!
#2 Set up your legal entity
What? Can’t I just start soliciting clients and call it good?
Well, you can. But you can also have your personal assets, including ANY monies you make (whether from photo biz or another job) on the line should an issue happen.
You can choose from Sole Proprietor, LLC, C Corp, S corp and Partnership structures. Choose the one that fits your plan – not just what everyone else is doing! As you can see from the list below, Sole Proprietor isn’t really a recommended option as you have no protection.
Setting up your legal entity is important for the following reasons:
- limited liability protection – protect your personal stuff
- demonstrates professionalism to clients
- tax benefits (which may vary by specific circumstances)
Don’t forget that setting up your LLC/Corp is not all you need to do. There are the federal name checks (see #1 above) and drafting of Operating Agreements/Bylaws as required by State law.
Resources to help you:
- DIY LLCs video + Operating Agreement template
- Full course of all steps > BizRevamp is the only legal web course for photographers.
Caution: DO NOT follow the advice of Small Business Association offices – they can’t provide any more than we provide here generally. If they try to give you specific, individualized advice you need to have this checked by a lawyer. They are not allowed to provide legal advisement.
#3 Make the appropriate tax elections with the IRS (if applicable)
You could be saving more money on your Income Taxes through special elections – be sure you’re doing it!
Read here to find out more about taxes:
- The new tax laws and your photography business
- What is the difference between federal, state & sales tax for photographers?
- Tax Tools for Photographers
#4 Get your sales tax permit
Remit your sales taxes if applicable and be sure you know WHAT products and/or services to charge on.
Careful if you’re doing all inclusive collections without breaking out sales tax that may be a state law no-no!
#5 Get other appropriate license and permits for your jurisdiction
Don’t get shut down for simply not getting the right licenses and permits for shooting. Licenses can include extra business licenses on top of your formation. Permits can be for specific shooting areas.
Note: A license is a permission to do a certain activity. License is NOT the formation of LLC or Corporation. That is legal entity, as seen in Step #2 above.
#6 Set up your EIN and Employer account, if applicable
Make sure you’re in line with the IRS and State law requirements – get these down!
When you have to get an EIN:
- You have employees (including W2ing yourself)
- You are an LLC with a S Corp tax election
- You are a Corporation
- As required by the IRS
When should you get an EIN:
- All the above + if you are an LLC and don’t want your social security number thrown around
#5 Use the right photography contracts to protect your business
Are you using the right photography contracts for your business?
Did you realize that there are more documents that just one “photography contract” needed to fully protect you?
Here’s a list of contracts you may need in the order you will use them:
- Portrait Contract – This governs the relationship between Client and Photographer. This will lay the foundation for sales by having provisions (if drafted right!) about completion schedules, ordering deadlines, etc.
- Model Release – The model release is the specific form giving the Photographer rights to use images for marketing purposes.
- Payment Plan Contract – This document outlines the payment plan details such as payment dates, amounts, and any penalties. If needed.
- Final Sale Agreement – This document is done on the ordering session day and acts to inform the client of a final sale and prevent a client from having “buyer’s remorse” and changing their mind.
- Album Design Agreement – This agreement is super important when you are spending lots of cost-of-goods on items, particularly an album that can be hundreds of dollars out of your pocket. I like to have an acceptance of the proof design by clients prior to ordering.
- Product Delivery Agreement – This agreement is a written acceptance of all products after the Client has had the opportunity to view them. This is especially helpful to prevent any potential “I didn’t get X product” statements after you have delivered the complete order.
All of these aren’t necessarily needed as it depends on your client’s order and your business policies. Just keep in mind you want to prevent issues instead of trying to fix them later.
Outlining all expectations ahead of time in writing is a great way to keep expectations clear and provides a foundation for optimal customer service.
#6 Get the right insurance
There are approximately SIX types to choose from!
- General Liability
- Commercial Automobile
- Property (Owner or Renter)
Please don’t think that all insurances are created equal. In fact, if you’re using your personal home owners/renters insurance, you probably ARE NOT covered for equipment and/or liability.
#7 Set up your budget and retirement savings
Every business needs a budget and appropriate retirement savings. Get these accounts set up!
It CAN be as simple as setting up a savings account, but long-term, successful savings requires some strategy!
#8 Get an appropriate price list
Make sure you’re actually pricing for success – don’t just fly by the seat of your pants!
You need to calculate your costs of doing business, combine this with market research + client psychology for best results.
Don’t compete with a drive to the bottom or succumb to fear of pricing yourself appropriately.
Don’t forget items:
- Set up your bank accounts – checking and savings
- Update all contracts, accounts, subscriptions to connect with your business name
- Consider trademarking your own logo
- Put copyrighting your images into your workflow
TheLawTog has hours of videos, handouts, transcripts and advice in one-all-access package – BizRevamp.
- Lifetime access
- 24/7 access
- Recommendations from lawyers, CPAs, financial planners & more
Goes over the following topics:
- Biz formation – step by step creation of LLC and Corporations
- Taxes – Federal income, state income, sales tax, use tax
- Insurance – Equipment, liability, disability, errors & omissions, etc.
- Retirement – walks through private and public retirement savings options
- Budgeting – plugging money leaks to keep more in pocket
- Business planning – step by step planning for success
- Contracts – fundamentals of contracts to set expectations with clients
- and more!
Rachel Brenke is the head attorney and photographer behind TheLawTog – the legal resource for photographers.
As an MBA, business consultant, and multi-state licensed attorney, she knows the ins
and outs of what goes into running a photography business AND how to legally
protect yourself. Not only does Brenke have real world photography
entrepreneurship experience, but she combines this with her intellectual property
law and business knowledge to provide a one-stop resource to help protect your
Disclaimer: I am a lawyer but I’m not your lawyer! View my entire disclaimer here.