Hey everyone, I have been in the freelance film production world for two years now. I was recently on a set with some industry veterans and there was a debate about filing taxes as an LLC vs as an individual. I wanted to see what other freelancers have to say about it.
Filmmaking / Directing : Should I make myself an LLC? by Alex Richard
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Definitely talk to an accountant and an attorney about this.
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Unless you are renting equipment, I don't see any benefit of an individual (behind the camera) forming a LLC. You have no risks like lawsuits or Workers Comp Insurance against the production. Freelancers (crew) are labor.
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We have some great advice about this in our ON STAGE WITH RB webcasts: https://www.stage32.com/webinars/on-stage-with-rb
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Amanda's webcasts would be a good thing to watch. Tennyson's advice on talking to an accountant and lawyer is good too. I believe if you make huge amounts of money as income, it might make sense to incorporate and invoice the production for your salary. On the other hand, as an employee of the production, they take care of income tax and other deductions, cover you for workman's compensation and provide liability insurance.
Thanks Michael, I don't make much money. I noticed that in my last fiscal year filling as an independent I was able to make a fair amount of money that was not taxed. If I didn't make more than $600.00 with a single employer that money didn't get taxed. Probably half of my contracts where one time gigs and payed under $600.00 so they weren't taxed. I think as of now I will keep filing as an Individual. I just don't want to be missing out or get over taxed. Every penny counts when struggling to get by as a freelancer. Thanks again.
One thing you have to realize is that companies deduct taxes relating to how much work you do for them and they have no way of knowing what other income you have. What set up a red flag for me was that you have a number of companies not deducting taxes (which they may be correct in doing so). You may find that at tax time when you fill out your tax forms that your total income is high enough that YOU are required to pay the income tax and other deductions. If this happens, you could ask the companies you work for to deduct taxes and deductions in the future. This way you don't get a surprise at tax time.