LLC, Payroll, IRS... yikes! How to make it easier?

Randall_Oelerich

Randall_Oelerich

Veteran
I am primarily a screenwriter, and have made a few short films I am thinking 3 years or so down the road making an indie feature ($100k budget). I know enough to know that LLC is the way I would go to protect my arse (personal assets).

But it seems a bit overwhelming when I think of forming an LLC, the forms, tax forms, accounting, payroll, complying with Fed and State laws for all the forms, quarterly reporting, payroll witholding, etc. What do you filmmakers do to simplify this, if anything, and how much should I budget for that (accountant, lawyer, etc)? Do you use software to form your LLC, to do payroll, etc? Do you have someone on the production team (a 'member' of the LLC) deal with the payroll and tax forms? Are there any cast/crew that can be treated as 'independent contractors'?

Please help with any tips or advice!
randall
 
Save yourself a LOT of trouble and hire a good accountant (CPA)... they can recommend the type of corp. that will work best for you.
Plus, anything spent on an accountant is a deduction every year! It's worth every penny.
 
What you have to do to form an LLC depends on your state I believe. When I got around to making mine, it was really easy and I did most of it online.

I have my own LLC but I don't do lots of work (less than six figures a year) with it, and I 1099 the people I subcontract work to. I do find it to be tedious– I'd rather be shooting or editing– but it has to get done and as long as my business is as small as it is, I'll do the paperwork then pay someone a few hundred bucks to crunch all my numbers and get me a fat return at the end of the year.

For goals as ambitious as yours, it will pay dividends (small pun intended) to get an accountant. I don't do big productions like the kind you're describing, and I only hire independent contractors so there really isn't a 'payroll'. We negotiate a rate and I pay them, 1099 them at the end of the year.

Maybe there is someone on these boards that could recommend a good accountant in your area? Don't know if any of this was helpful but good luck!
 
When you get into production there are companies like PayReel that can handle all of the payroll for your cast and crew. They handle SAG, taxes, workman's comp, etc. I used them on my short. Good luck with the $100K short.
 
Once you have decided on your corporate structure (with the help of a CPA) and filed your incorporation papers (nor really difficult) a good by the hour bookkeeper can do your payroll and other filings for a few hundred per month. You don't need a CPA for this part. You can certainly do this yourself within any decent bookkeeping package like quickbooks (I am Mac based and use MYOB), but you do need to have a little basic knowledge to do so and it will consume some of your time. Read: loss of creative time.

You may want to CAREFULLY avoid having a payroll by employing people who have their own business licenses, like an independent sound person. For folks that would clearly be employees, I hire them via a temp service like Labor Ready who takes care of all the payroll and insurance. Technically they are working for the temp service, and you tell the temp service how much you are going to pay them etc. and you pay the temp service who pays the employee. This is perfectly legal, keeps your crew insured and legally employed, and lets you avoid having a payroll. This will cost you a few bucks per hour, but for me is well worth it to avoid the payroll hassle factor and all the burden that comes with it.

Grant
 
a qualified CPA will make your life much easier. Ours does our monthly/quarterly statements, and handles all our payroll and taxes for us now... it's a nominal fee for the peace of mind and the time saved...
 
ZazaCast said:
Save yourself a LOT of trouble and hire a good accountant (CPA)... they can recommend the type of corp. that will work best for you.
Plus, anything spent on an accountant is a deduction every year! It's worth every penny.
Click to expand...

Agreed.

Until you are equipped with the knowledge and skill to safety swim in the deep end, get yourself a lifeguard.
 
ggrantly said:
You may want to CAREFULLY avoid having a payroll by employing people who have their own business licenses, like an independent sound person. For folks that would clearly be employees, I hire them via a temp service like Labor Ready who takes care of all the payroll and insurance.
Click to expand...

A business license? Wouldn't most any worker on a film be considered an independent contractor if the production is temporary, the workers don't work out of a central office, etc.?
 
Shutter,

In the eyes of the IRS, there are bellweather questions; do you supervise them, do they keep books for taxes, are they normally engaged in what you are hiring them for, do you schedule them, etc.. With regard to workers comp, if they don't have an established business, then you are on the hook. So while you may get away with the IRS issue, liability is an entirely different kettle of risk.

Grant
 
I use accounting software and just plug stuff in as I go, at the end of the financial year I export to my accountant.
 
Snazzy Flapper said:
When you get into production there are companies like PayReel that can handle all of the payroll for your cast and crew. They handle SAG, taxes, workman's comp, etc. I used them on my short. Good luck with the $100K short.
Click to expand...

PayReel or something like that sounds exactly like what I would want to take away that headache. What did you have to pay for a service like that? BTW, my $100k film would be a feature, not a short.
 
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