Save your progress to a file for permanent backup • Load from previously saved file
Estimated Time: 30-60 Minutes
Create your LLC's operating rules and set up proper tax reporting to protect your assets and maintain legal compliance.
Operating Agreement
What it is: An operating agreement is your LLC's "constitution" - a legal document that outlines how your business operates, who owns what, how decisions are made, and what happens in various scenarios. It's your internal rulebook.
Why you need this: Without this document, courts can't tell the difference between you and your LLC, which breaks your corporate veil protection. It proves to investors, banks, and the IRS that your business is separate from you personally.
Without an operating agreement, if you get sued (from uncleared samples, etc.), courts will treat you and your LLC as the same entity. This breaks your limited liability protection and puts your personal assets at risk!
• Protects your personal assets from business lawsuits
• Required for bringing in investors
• Establishes asset protection for copyrights and equipment
• Proves business legitimacy to banks and institutions
• Defines what happens if LLC dissolves
Key Decisions You'll Make:
Make your artist managers "Officers" (not Members) so they can help run operations without owning your business. This keeps ownership separate from management and protects your equity when bringing in investors.
W-9 Form (Tax Information)
What it is: A W-9 form provides your tax information to companies that pay you. It tells them what name and tax ID number to use when they send you a 1099 tax form at year-end.
Why you need this: Required by any company paying your LLC $600+ per year. Filled out incorrectly, it creates IRS red flags and tax problems. For single-member LLCs, you use your SSN (not your EIN) for specific tax reasons.
By default, single-member LLCs are "disregarded entities" for tax purposes. This means:
• You still have liability protection for lawsuits
• For taxes, you and the LLC file together on your personal return
• You use your SSN on W-9s (not the EIN)
• Your business income goes on Schedule C (business) and Schedule E (royalties)
How to Fill Out W-9 (Single-Member LLC)
For single-member LLCs, the IRS requires your SSN on W-9s because you're taxed as an individual. Your EIN is only for banking and state requirements. Using the wrong number creates IRS mismatches and problems.
• Schedule C: Business income (merchandise, shows, services)
• Schedule E: Royalty income (performance, mechanical, sync royalties)
• You'll pay self-employment tax on net earnings after business deductions