Podcasting Q&A

Should you create an LLC for your podcast?

January 18, 2021 Buzzsprout
Podcasting Q&A
Should you create an LLC for your podcast?
Chapters
0:00
Intro
0:14
"When should you create an LLC for your podcast?"
1:16
What is an LLC?
2:04
#1. Do you plan to monetize?
2:27
#2. Is the podcast for your business?
2:54
#3. Do you have a co-host?
3:46
#4. How old is your podcast?
4:27
#5. Will it save you money?
5:26
Should you form an LLC?
Podcasting Q&A
Should you create an LLC for your podcast?
Jan 18, 2021
Buzzsprout

Jared from the Remarkable People podcast asks, "When should create an LLC for your podcast?"

TL;DR
Just as a disclaimer, we are not legal or tax experts but we have formed a few LLCs in our time (so take our advice with a grain of salt). Filing an LLC for your podcast can allow you to "write off" podcast-related expenses, leading to a larger return come tax season. So why isn't it something we recommend for all podcasters?

In today's episode, we'll walk through the pros and cons of creating a business for your podcast and help you decide if it's a good fit for your show.

Record your podcasting question at Speakpipe.com/Buzzsprout to be featured on a future episode.

Review Podcasting Q&A in Podchaser to let us know what you think of the show.

Show Notes Transcript Chapter Markers

Jared from the Remarkable People podcast asks, "When should create an LLC for your podcast?"

TL;DR
Just as a disclaimer, we are not legal or tax experts but we have formed a few LLCs in our time (so take our advice with a grain of salt). Filing an LLC for your podcast can allow you to "write off" podcast-related expenses, leading to a larger return come tax season. So why isn't it something we recommend for all podcasters?

In today's episode, we'll walk through the pros and cons of creating a business for your podcast and help you decide if it's a good fit for your show.

Record your podcasting question at Speakpipe.com/Buzzsprout to be featured on a future episode.

Review Podcasting Q&A in Podchaser to let us know what you think of the show.

Sarah:

In today's episode, you'll learn whether you should create an LLC for your podcast. Welcome to Podcasting Q&A, where you'll learn the best tips and strategies to launch, grow and monetize your podcast. This week's question comes from Jared.

Jared:

Hi, this is Jared Hocking hosted the all things connected podcast. I love your show and find it very useful. Thank you for all that you're doing. At what point does it make sense to incorporate your podcast as a business or 501c3? For examp e, if you're spending money on advertising, that could be co sidered a business expen e. If it's an educational podca t, it could be a nonpr fit. Do you have any advic here? Thank you.

Sarah:

Thanks for your question, Jared. Now, before we start today's episode, just a disclaimer, we are not legal or tax experts around here we are podcasters. But we have formed a few LLCs in our time. So first, let's take a look at the 501c3 Now a 501c3 does give you tax e empt status. However, there are a lot more legal requireme ts and paperwork that you have o fill out and file to be able t start and maintain one. So b cause of the challenge for most podcasters, it's actu lly easier to form an LLC. Let' go over the basics of what an L C actually is. So LLC stands fo limited liability company, hich is an agreement between y u the owner, and the business, the podcast. So the idea is t separate your personal ssets from your business ssets. So there's a layer of rotection there, which we'll get to later in this episode. es, there are also tax benefits, like you can deduct marketing costs and production costs. So in theory, when it comes tim to file your taxes, you're pa ing less of it. That being sai , it doesn't mean it's the right choice for you. So before yo go and spend gobs of money on legal expert or tax expert an trying to start filing th paperwork, let's take a look at some questions that you shoul consider before filing LL . So question number one is do you want your podcast to be mor than just a hobby? So in other ords, are you planning to moneti e your podcast? Are you plann ng to make some money from your show? And if the answer is yes, then it might be a good id a to form an LLC so that you an take advantage of those tax benefits. Question number tw , is your podcast meant to upport or is a part of your exis ing business. So for example, et's say you have a consultin business, and you want to s art a podcast as a marketing tool to help you generate eads and hopefully customers for your consulting business. Now, in this case, if you don't already have an LLC for your onsulting business, it's prob bly good idea to form one and h ving a podcast is even more of a reason to create an LLC. Ques ion number three, is your show have a co host? Or is it part o a podcast network? Now if yo 're flying solo, your podcast i just a hobby, you're not reall sure what you want to do with i . The whole question of whethe nice Ukraine LLC can be left t the side for now. However, f you have a co host, or your s ow is part of a podcast n twork, forming an LLC will give you a framework in which to avigate that relations ip. So you can both really un erstand what your legal rig ts are and give you a lot more larity. So for example, o you and your co host have 50/5 ownership stake? What happens o the money that you earn? Or if you're part of a podcast etwork? Does the Podcast etwork own part of your show? Wh t happens to the profits r the money that you earn? Th n? These are all question that are really useful to answe before you enter into any busi ess relationship. Question number four, has your show bee around for a long time? Or are you just starting out? lik we mentioned earlier, an LLC i to provide a protecti e barrier between you the owne and the business, the podcast. So the idea is it reduces our liability in case somethin happens it's out of your con rol. Now if you're just starting out and you don't have a lot of listeners, so the chances f that happening isn't that hig . Now However, if your show has been around for a long time, yo have a lot of subscrib rs and listeners or even a h ge fan base for your show, th n it might be a good idea to orm an LLC just in case somethin does happen. Question number f ve, do the benefits outweigh the costs? Yes, forming an LLC c n reduce your tax burden l ke if you wanted to duck tha new microphone that you got ut don't forget filing and main aining LLC also comes with its own costs, right there's filing fee for your state. I could even be fees for the atto ney to help you file these do uments. If you need a Register d Agent that might come with its own fees. If you want to creat a separate address or have a p el box for your business that comes with addition l fees or If you're really u sure what you need to deduct i your business, and you need to onsult an accountant or a CPA th t comes with its own fees, so all of that can really add up. o if you're just looking o deduct a couple $100 from you business, it might not be the b st idea. However, you're p anning to do something like lau ching a course or monetizi g your podcast in a much big er way than creating an LLC can e a great idea. Ultimately, there are a lot of factors to consider whether or not you should create an LLC for your podcast. Now, it's really difficult to tell what your individual needs are. So your best course of action is to find a local attorney who can walk you through the option so that you can make the best decision for you and your show. Thanks for sending us your question, Jared. Now if you have a question you'd like for us to answer in a future episode of the show head to speakpipe.com/B zzsprout or click on the link in the show notes and leave a brief audio message. Podcast ng Q&A is available both video a d audio format. If you'd like vi eo, please subscribe to the Buz sprout YouTube channel. And if ou prefer audio Podcast ng Q&A is available on your fa orite podcast app. That's t for today. Thanks for listeni g and as always keep podcast ng

Intro
"When should you create an LLC for your podcast?"
What is an LLC?
#1. Do you plan to monetize?
#2. Is the podcast for your business?
#3. Do you have a co-host?
#4. How old is your podcast?
#5. Will it save you money?
Should you form an LLC?