Hey Photographers! Last month, we wrapped up a blog series aimed at something that consumes so much time and energy from wedding photographers: post production! If you missed it, Part 1 is here. This week, we’re continuing a new series that caused us SO much headache in the early days of our business: How to Officially and Legally Start a Photography Business!

 

Once you start making some real money with your photography, you may want to consider establishing a legal business entity. For the sake of organization, liability, legitimacy and tax-efficiency, this is the direction many photographers will go after a year or two of making money. And if you hope to go full-time in your photography one day, you’ll need to do this sooner or later!

 

Although establishing a business can seem like a daunting task, it’s actually more simple than it seems. Follow the steps in this blog series to go from side-hustler to business-owner!

 

How to Officially Start a Photography Business 2: Establish An LLC

Establishing yourself a seperate business — rather than an individual who makes money — does a few important things, and is crucial for several reasons! We’ll get into them all in this blog, and give you a step-by-step guide to going from person-who-takes-photos-and-makes-money to a business-owner!

 

 

What is an LLC?

Let’s start by defining LLC, or “Limited Liability Company”. In many states, it’s the most simple kind of business that you can establish that isn’t a “Sole Proprietorship”. Think of a sole proprietorship as what your business is by default. If you are a student, or work a part-time or full-time job outside of your photography business, then you start to make money with photography, by default your “business” is a sole proprietorship.

 

I write “business” in quotations, because at that point, there’s NO legal difference between yourself (Sarah Sheldon, for example) and your business (Sarah Sheldon Photography). And for a time, that is totally okay! Especially if you aren’t making much money, this is the simplest and easiest way to operate your business.

 

 

Why Should I Establish an LLC?

Although a sole proprietorship is good for a time, an LLC does a few important things that you’ll eventually want. First and most importantly, it separates you from your business. Once we established Hunter and Sarah Photography as a business, we got an EIN (employer identification number) from the federal government. An EIN is like a Social Security number for our business. There were now three “entities” living in our house, Hunter Sheldon, Sarah Sheldon, and Hunter and Sarah Photography, LLC.

 

This means that our LLC could now apply for a bank account, credit cards, and insurance in its name instead of ours. This makes separating our money from our business’s money SO much easier! Gone were the days of wondering, “If we buy this lens, will we have enough for rent and groceries at the end of the month?” We knew that if we were taking care of our finances using the money in our bank account, whatever was in the business’s bank account belonged to the business!

 

The “Limited Liability” part of LLC is also really important. If (God-forbid) someone tripped over our camera bag and broke their leg, then sued our business for damages and won, they could potentially take all the money in our business bank account and all of our camera gear. But that’s where it would end. Our house, our cars, my engagement ring, etc. belong to us as people, NOT our business. Our liability (in this case, how much we could owe) is limited. We know that all of this can be a bit confusing at first, but it’s a big help and peace of mind in the long-run!

 

 

How Do I Establish an LLC?

First off, I want to be clear that LLCs are managed at the state-level, rather than the federal level. This means the process is slightly different for every state, so all we can speak of is our experience in the Commonwealth of Virginia! But for us, it’s actually much simpler than we expected, and can be done in less than 15 minutes.

 

Start by finding out where you’ll apply for an LLC with your state. In Virginia, it’s as simple as visiting the Virginia’s State Corporation Commission website and clicking “Creating a Business”. From there, you’ll be asked to make your first important business decision: the name of your business!

 

Hunter and I are firm believers that the best way to name your photography business is simply “FirstName LastName Photography”. Although it might seem a bit cliché compared to some of the more creative names out there, we know that it communicates an important principal. When you hire Hunter and Sarah Photography for your wedding day or engagement session, you’re getting Hunter and Sarah! And in our opinion, WE are what makes the difference in our business. And people like to deal with people, not corporations or nameless organizations. If you hired “Charlottesville Wedding Photography Collective” to photograph your wedding, who are you actually hiring?

 

 

Other Steps to Forming an LLC

Once you’ve decided what to name your business, you’ve done the hardest part! As you’re filling out the paperwork, you may be asked to choose a “Registered Agent”. This is just the person who the government will officially communicate with – the person who will be responsible for filing taxes and applying for other official things. In 99% of the case for a small photography business, this will just be you!

 

Once you’ve filled out the rest of this form, you’ll either mail it or submit it electronically to your state. There will also be a filing fee, but it will most likely be $100 or less. Then… you wait! A few days (or weeks) later, you should get a letter in the mail confirming that you are now officially a business owner! Sort of…

 

 

Getting Your EIN From the Federal Government

Like we mentioned in the first section, once we established our LLC with the Commonwealth of Virginia, we got an Employer Identification Number from the federal government. But this didn’t happen automatically. Only after you’ve confirmed that your LLC in your state is official, THEN you’ll file for an EIN with the IRS. You can fill out a paper form and mail it, or submit it online. Again: you’ll need to wait until your LLC has been established with your state, since the IRS will check with your state government to make sure that your LLC is real.

 

Then, after you’ve applied, you’ll get your EIN in the mail a few weeks later (or instantly online). This EIN makes you legit! You can use this number to apply for bank accounts, credit cards, business loans, etc. But remember: an EIN is like a Social Security Number for your business. You’ll want to keep this number private, secret, and only use it for official purposes.

 

One last step you may have to take is applying for a business license with your local government. For us, a Charlottesville business license only costs $35 per year when your business makes less than $50,000, and only takes a few minutes to apply for.

 

At this point, you should pause to celebrate. You’re now officially a business-owner!

 

 

In the next segment in this series, we’ll chat about a few things that you’ll owe your state as an official business.

 

Until next time,

Sarah + Hunter

 

Want More?

 

Click HERE to get your free copy of our eBook: “5 Essential Tips for Turning your Side-Hustle into a Full-Time Photography Business.” You’ll also be subscribed to our newsletter, so our newest content, weekly encouragement, and exclusive offers will be delivered right to your inbox!

 

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Check out the other segments in this blog series!

• How to Officially Start a Photography Business 1: Start Keeping Track
• How to Officially Start a Photography Business 3: Pay “Sales and Use” Tax Each Month
• How to Officially Start a Photography Business 4: Get a Business Bank Account
• How to Officially Start a Photography Business 5: Get Business Insurance
• How to Officially Start a Photography Business 6: Prepare For (And Pay) Self-Employment Taxes