Book more photography clients with this step-by-step framework.
Hi, I'm Brooke! I'm a believer, wife, mama to two, Oklahoma photographer, and photography business coach.
I help photographers grow profitable full-time businesses from home.
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Are you wanting to make sure you’re running a legal photography business and that your taxes are prepared and accounted for correctly? Maybe you dread tax season and you’re not even sure if you’re running as an actual photography business. If you’ve been feeling confused about taxes, then continue reading as Tiffany Bastian the owner and founder of Bastian Accounting for photographers shares these tax tips for photographers to take to make sure you’re running a legit photography business.
Many photographers assume that they’re not technically in business until they form an LLC., but this is not true. Tiffany explains that the second you take a dollar from someone for a service such as photography then you should be running a legal photography business. From this point on you need to get organized. Businesses can grow so fast from that first dollar made so taking those steps to get organized now can save you stress and money in the future.
Your first action step in creating that structure for your business and planning for taxes is to set up a separate business bank account. This way you can separate your business finances from your personal finances and have a better way of tracking your income and expenses. This will definitely help you begin to get organized and plan for that time when you decide to form an LLC and take the next steps in making your business official.
LLC stands for Limited Liability Company. It can be difficult to determine when to form an LLC but it really comes down to mindset. Many photographers think that you have to make a certain amount of money before you can form an LLC. But if having a legit photography business is really what you want to do then commit to it 100 percent. If you’re going to do this then go all in and give it your all. Forming an LLC is the smartest thing you can do for your business and your peace of mind. It proves your commitment and shows a level of professionalism. Check into your level of commitment for your business and then go file for an LLC.
Just like filing an LLC is different for every state, each state also has different rules and fees for sales tax as well as state income tax. So familiarize yourself with the taxes for your state in particular and then you can plan how much to set aside from your sales for taxes. You can start here and take a look at this state tax guide for photographers from Tiffany. A good rule of thumb is to set aside 30% of your photography business income for taxes to cover all of your bases.
Tiffany shares that you don’t necessarily need a CPA to file your taxes for you. An EA (Enrolled Agent) is also going to keep you compliant at tax time. Paying a CPA, EA, or an accountant to file your taxes for you is the best way to make sure everything is accounted for. You are then able to hand over to them everything for your tax filing and they then file it for you and help you maintain a legit photography business.
Let’s recap those steps you need to take to make sure you’re prepared for taxes for your photography business.
Taxes for your photography business isn’t a glamorous topic, but I hope these tax tips for photographers helped. It can feel so empowering when you take a look at your numbers and know that you are running a legit photography business by filing your taxes properly.
If you loved this post and want to learn more, check out Bookkeeping For Your Photography Business.