Do Artists Need an LLC?

Dear Best Friends,

When I’m describing this newsletter and my art ambitions, I haven’t been sure whether to call it a “business” or not. This doesn’t matter if I’m talking to friends about this side-project of mine, but I’ve been wondering if it does matter in other capacities. For example, does it have to be a registered business in order to claim tax deductions? Actually, that was my only real concern. But I wondered if I should have other concerns as well.

Lucky for me, I have acquired (haha!) a friend, Claire Brown, who happens to be a business laywer (she specializes in M&As, so that’s why it’s funny that I said I acquired her, in case that wasn’t clear). I have leveraged Claire’s proclivity for precise, meticulous work many times in the past - but only for things like assembling intricate birthday party decorations and other tasks that are arguably below her pay grade (but she is always enthusiastic anyway!!). Now I realized I could go to her with all my questions about starting a business!

So this week, I’m sharing my interview with Claire - a partner at the Portland-based law firm Tonkon Torp where she advises business on everything from contracts to business structures, helping founders make informed decisions about risk and liability. Claire and I became friends when our kids were in the same classes in school, and she has always been very supportive in my creative ventures. So it was very fun to get to talk shop with her in her area of expertise - something I know very little about - for my project!

Check out the full video here, and read on for the big takeaways. I highly recommend watching or listening to this one if you want the full details, Claire explains things really well and in more nuance than I’m laying out here, in the interest of providing some digestible guidelines. I also refrained from most of my silly commentary in the following guidelines for the same reason, but there’s plenty of that in the YouTube.

Navigating the Legal Side of Your Creative Business: A Tactical Guide with Claire Brown - Business Attorney

For artists launching a business, one of the first legal questions that comes up is whether to establish a formal business entity like an LLC (Limited Liability Company). Claire walked me through the decision-making process, step by step.

Do You Need an LLC (or Any Legal Business Structure)?

Not every creative needs to form a business entity right away. Here’s a breakdown of who should consider it and who can wait.