For the creators and taxes..
- Thread starter BlackGoku
- Start date
llc separates business and personal finances. I do believe if you start one, you will need separate business account.
It's a bit of a pain, but worth it protecting your personal assets from lawsuits and creditors.
Thanks fam. Starting from scratch so trying to see how I can charge off buying equipment (cameras, etc)
In the short term, you can do a sole proprietorship.
No special paperwork, no separate accounts. When you file your personal taxes, you will do a schedule c which will be for all your business income and expenses
Apply for EIN number. you can use it for billing and business tax info instead of your Social. It's free and you can get immediately if you are willing to deal with the IRS website.
Just know you won't have the asset protection, you will have with an llc. Definitely consider some sort of business liability insurance.
Thanks!
That was good advice @xxxbishopxxx provided but I Just want to build on it a bit and clarify a couple things for anybody else following along.
If you go the LLC route as a single-member, which you would be because it is only you. Just know that for tax purposes, the IRS still treats it like a sole proprietorship. So when it comes to filing, you’ll still report your business income and expenses on a Schedule C with your personal taxes, the same way you would if you didn’t form an LLC. So from a tax angle, not much changes at first.
BUT the real difference is legal protection. An LLC helps separate you from your business. So if something ever went wrong, like a lawsuit or debt, your personal stuff (like your personal bank account, car, or house) is protected. You could have a million dollars in your personal account and they could not touch it.
Also, getting an EIN (Employer Identification Number) is a smart move. It’s free on the IRS website and it lets you keep your Social Security number off invoices and contracts, which is just good business.
Now when it comes to keeping your money separate, this part is important. Even though it’s not required to have a business bank account, it’s strongly recommended. Mixing personal and business funds can mess with your liability protection. That’s called piercing the corporate veil and it basically means if you’re not treating your business like a separate entity, a court might not either. If you are using personal expenses out the same account as your business, the person suing you can now claim you and your business are acting as one. If the court agrees, they can now come after your “Personal assets”
Keeping a separate business account helps protect you.
Oh, and on the write-offs, yes, you can write off cameras, gear, equipment, etc., as business expenses, whether you’re an LLC or a sole prop, as long as you’re using them to make money.
Quick recap:
- Single-member LLC = taxed like a sole prop, but with legal protection
- EIN = free + keeps your Social off paperwork
- Separate account = keeps your liability protection strong + easier taxes
- Mixing personal and business = risk of losing that LLC protection (piercing the corporate veil)
- Equipment = tax deductible if it’s for your biz