If you have thought about transitioning from freelance photography work to an established business, it will mean combining your creative talents with a business sensibility. Few people with specific skills like photography, graphic arts or web development start businesses out of the blue. Many have been seeking and accepting freelance work to supplement their day jobs for years.
You may eventually decide to move from occasional or casual freelancing into full-time self-employment and establish a business. When you do, here are some steps to give you a clear shot as a professional:
Make It Official
Making your business official legitimizes you and your work and provides tax benefits that you don’t receive as an individual who happens to work in photography.
The first step is to register your businesses in the state where you work. You can do this online at your state’s Secretary of State’s website. The site will list all the steps you need to take like arranging for a business notice, explain things like sole proprietorships and LLCs, and provide valuable resources. It’s much simpler than you might expect.
Establishing a wall between your personal life and your business also protects your personal assets such as your home or car from lawsuits. You will be able declare your professional equipment—everything from lenses to laptop cases—as business assets that can help lower your taxes.
Go to the IRS website and request an Employee Identification Number (EIN). Your EIN acts as a Social Security number for your business. Yes, it means more paperwork at tax time but now you also can write off the cost of an accountant as a business expense.
The Small Business Administration points out other reasons to go aboveboard:
- Your name or the business name you’ve chosen will be protected; no one else in the state can use it.
- You get access to state-backed, low-interest, small business loans many banks currently aren’t offering.
- Your business debt belongs to the business, not to you personally.
Determine Your Specialty
Celebrity photographer Gina Milicia, whose work has appeared around the world, wrote this bit of advice in a post for Digital Photography School: “Your uniqueness is the most important asset you have. The photography industry does not need another Ansel Adams, Annie Leibowitz or Alfed Stieglitz. Develop a unique style that sets you apart.”
Milicia’s advice is echoed by ShutterCliq, a website dedicated to helping photography businesses succeed. Deciding your specialty, according to the site, can only help you get better at your chosen field and make you a better photographer.
Get Solid Business Equipment
You already know what equipment you need for photography but what about for business operations? If you’re working from a clunky old desktop, get a laptop. It doesn’t have to be an expensive outlay; companies like Lenovo make laptops that start at $500.
A laptop’s portability will pay off in many ways:
- it will let you immediately load and organize images, freeing up space on your camera and ensuring that nothing will get lost
- use of essential post-processing services such as Adobe Photoshop or Lightroom 4 (a ShutterCliq favorite)
- access to email; easier to respond on a real keyboard than a tiny smartphone board
- access to cloud services you use for banking, backups and software access
This article showed up in my newsfeed and after reading it I would like to add my opinion to the mix.
1. Forming an LLC, LLP, S-Corp, Inc, etc. is completely unnecessary for starting a business and running one for several years in my opinion.
2. Anyone can be sued at anytime irregardless of the above (registering a business with the state).
3. You will complicate your tax filing, causing both time and money, to properly pay your taxes…which also leads to errors and possibly fines.
The best thing to do when starting out and long before you make your paying hobby your full time career is to form a DBA (“doing business as”) using the name you will later as your company name.
A DBA allows you the following advantage:
1. You can open a checking a checking account with a bank under that name.
2. You can obtain an EIN number.
3. You can collect money (bill clients) under that name.
If you are worried about being sued you can buy insurance at anytime for the year or per project. You do NOT need to be a company to be insured.
If you decide that your hobby is taking off and is becoming a career/business you can form a company at anytime using the name you registered as a DBA (which is very cheap to obtain and can be done in person at your county clerks office in 15 minutes).
Good luck with your new venture everyone!
Thanks for the info Chris!