Today we are talking about the importance of copyright protection—particularly for those of you who have digital products or products that can be “knocked off.” Copyright is a type of intellectual property protection. That phrasing is especially important for those of you with digital products, i.e. prints, illustrations, or e-books, which are particularly easy to steal. No one likes to work and create a product only to see it stolen and others benefitting from it.
One more time – we are going to talk about the Limited Liability Company or LLC. I have been getting a lot of questions lately that all basically boil down to the question: “is it necessary for me to set up and LLC or sole proprietorship?” The answer to such s general questions is — it depends. Really the only time that it depends is when you are thinking about setting up a corporation, limited liability partnership, or professional corporation/partnership/etc. If your default is to be a sole proprietor or a traditional partnership, then the answer is always YES, you must set up your LLC.
Last month we discussed the basics of what you as a business owner should be looking for in a contract with your designer. This month we are going to take a deeper look at a few parts of the contract that can be unique to the design field.
I am the type of person who just wants to do it. An idea comes to me and I want to get it done. I don’t want to sit around, discuss and think about it all day, I want to execute it. Most entrepreneurs share this sense of urgency—the need to execute. It is a huge part of what makes your business successful. However, what the best entrepreneurs are interested in is when you get it done, that you’re getting it done right. Getting it done right starts you off with a solid legal foundation that will save you a great deal of headache and unnecessary expense.
1. What is the difference between a sole proprietor and LLC?
A sole proprietor in the eyes of the law makes a person a business. Any name you give the business is considered as you doing business as that name. In the distant past the benefit of sole proprietorship over other forms is that business profit is taxed as your personal income; whereas, with a corporation, it is taxed as the corporation’s income and then pays out to you as the owner, who is then taxed again. Sole proprietorships also do not require any paperwork. You just start doing business, though you do need to file for an assumed name certificate if you are using another name than your own and will have to deal with appropriate sales tax issues, etc. The major downside to a sole proprietorship is unlimited personal liability. If your business has a contract dispute or a tort claim against it, you are liable and your personal assets are reachable. When you have co-owners or business partners in a sole proprietorship, it becomes a partnership instead, which is an identical form, but more complicated and sometimes more regulated due to the additional owners.