Going legit and forming an LLC

There's absolutely no benefit whatsoever to forming an LLC to play 4 to 6 nights a month aside from the van insurance issue, unless none of the members trust each other and need the operating agreement to resolve disputes. You simply don't make enough $$$ to make it necessary, IMO (and yes, I am a lawyer).

 

Is there a plan to increase the number of bookings or the rate they pay. There's a big difference between making a change to stay where you're at and making a change to enable you to move forward.

Wulf

 

Ridiculous IMO.Totally unwarranted,and you do realize that the little bit of $$ you're making now becomes a revenue you're going to have to declare come income tax time.

 

When the overwhelming majority of everyones income is derived from the band solely.

I don't know any clubowners or agents for part-time bands who care if you're incorporated or not.

 

Forming an LLC is actually a great idea if you are being paid by check. Because the club will inform the IRS that you were paid and you will owe taxes on that money. Now, you can write off so much on the band, such as vehicles, insurance stuff like that. If you don't form an LLC you have to pay those taxes on your own, if you do you can most likely write off most if not all of your taxes.

 

Even if you don't form an LLC, you can still write-off those expenses, its just that the person incurring the expenses gets the write-off.

Example, if your da bassplaya, you write off your string purchases, cords, speakers, amp, etc. etc. But only the owner of the band van can write off its expense. There's the difference.

Frankly, at what you're making, its not worth the LLC IMO.

 

They don't pay by by check.It's a cash buisness.
And if you want to claim all your expenses as a musician,you have to provide receipts from the clubs.You'd be hard pressed to get a receipt from any club-owner I've ever dealt with.
Maybe the odd festival gig or special event here or there,but that's about it.

 

It's a funny one allright, personally I wouldnt go down the LLC route if your doing 4/6 gigs a month (we do 4/6 gigs A WEEK).

Theres a band in my area that went down that route, basically they get paid by cheque for every gig and then the bank gives them a weekly wage out of that, however, because of whatever agreement they have they have to meet a certain quota every month and as such they have to take every crappy little gig they can get their hands on.

Also the bassist is an "employee" of the company (he joined after they went legit) so even if theyre not gigging he HAS to be paid. Might be worth bearing in mind if down the line you want to take on board new members.

 

Are you sure about that? I talked to an accountant friend the other day that said you can't do that. If you can, that sounds pretty good.

 

Really Not up here.(Canada)I've been playing clubs up here for 10 years,I can count on one hand the number of cheques I've seen.I played alot in the states on the hotel circuit,and that was cheques,here too,but not clubs.
Most club owners don't want a money trail,because they don't pay performance rights fees or union scale for muzo's or tech's.

 

Silly idea, that LLC. Since you'll have employees, you will have to fill out reams of paperwork. I was incorporated once and having to fill out all the 941, 940 telefile, FUTA, all the SSI forms and a bunch of others I can't even recall made a wreck of me! This could piss off the club owners as well, because as mentioned earlier, they hate paper trails. And you'll be making one big honking one right to their door. Sorry to shout but, DON"T DO IT!

 

Everyone knows that you can write off musician expenses.. it was on a Tax company's commercial last year.

 

IMHO/IME:

If you haven't written a business plan that includes a detailed partnership agreement, as well as cash-flow and profit projections - and had it reviewed by a competent and dispassionate attorney and CPA, your band probably isn't ready to contemplate a formal business venture.

If all aspects of the proposed venture don't stand up to scrutiny on paper, it really doesn't matter what any of us think.

 

By whom and how? You think the attorney is gonna quit his day job for the band? I've played in a cover band for 29 years and at our peak we played 4-6x/month. The only thing a venue owner cares about is his bottom line - he could care less about whether you have an LLC. I don't see the point.

 

He said each of them do.

 

How much will the bloodsucking attorney be making?