Filing for a DBA, LLC + Taking a Paycheck - Jasmine Star

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Filing for a DBA, LLC + Taking a Paycheck

December 8, 2014 - Business, How To, Photography

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Dear Jasmine,
I have no clue where to start with how to pay myself out of the business. I finally figured out that I need to do the DBA, LLC, tax ID (not that I’ve figured out that exactly yet)… If I need to talk to an accountant, tax person or WHAT. You know, the stuff you don’t learn when you decide to get a degree in art photography… I can’t find anything in my research! Please help!
Sincerely,
All Sorts of Confused

Dear All Sorts of Confused,
You asked a few questions that could result in hundreds of blog posts, but I’d love to offer a few things that I’ve learned along the way. (Important Note: this blog post is just personal advice based on personal experience…I heavily suggest consulting professionals with your specific questions in their related fields, specific to the state you’re doing business.)

I received my first digital camera in 2005 and when I decided to pursue photography professionally, I had no idea where to start. I just dove headfirst into the pool of the photo world and tried not to drown. Here’s a loose outline of how I legitimized my business…
March 2006
Went to the Los Angeles County Registrar-Recorder/County Clerk’s office and filed for a DBA (Doing Business As). Because I didn’t know how to structure my new business, I selected Sole Proprietorship/Partnership (this can be risky because business creditors could get to your personal assets, as well as business assets…most new businesses opt for an LLC).
I filed my new business in a local newspaper (as required by LA County {at the time} to procure my DBA).
April 2006
I applied for my first business credit card. I used this card for every business purchase and ensured my business expenses (camera gear, purchasing a website domain, etc.) were all tracked on this card.
May 2006
After scoring my first second shooting opportunity (my first legit gig in the photo world), I opened a business checking account (it’s super important to ensure your business income is separate from personal income, especially if you’re working a daytime job, like I was).
June-September 2006
I second shot weddings almost every weekend, and deposited the payment for my services into my business checking account. All the gear I bought, I paid for with my credit card, then immediately paid it off in full with the funds in my checking account (I never went into debt for photography gear I couldn’t afford).
October 2006
I shot my first three weddings as the lead photographer this month.
December 2006
I called the IRS and applied for a tax ID, or EIN. This is a free service, so be sure not to pay a site that charges for this service (you can apply for an EIN HERE). I wanted to use a tax ID to file my business taxes instead of my social security number, which I preferred to use just for my personal income taxes.
I met with an accountant to discuss filing taxes for my personal income and business income. I discovered I invested more in my business (purchasing gear, attending workshops, investing in my online branding) than I made for my services (which is quite normal for a small business in its first year).

February 2007
I hired a bookkeeper, Scott. He tracked my business income and expenses, and gave me monthly Income Statement, a Profit/Loss Statement, and a Year To Date Income statement (I still work with Scott).
March 2007
I move to Orange County, California and file for a business license in Orange County.
April 2007
I go full-time as an Orange County wedding photographer.
May 2007
I took my first Jasmine Star Photography paycheck. This paycheck was basically made up of the funds I needed for rent and other necessities. I wanted my business to be as profitable as possible, so drawing an impressive paycheck wasn’t important to me.

At the end of 2007, I had booked 38 weddings. I was a full-time wedding photographer, but only took barebone paychecks. Almost ten years after getting my first camera, I still take small paychecks. I have since opened a business savings account and only keep the necessary amount of funds in my business checking account to pay off my credit card bill (in full) each month. I draw monthly income from my business checking account, and also set aside funds in a personal savings account (paying special attention to allocate funds for retirement and small investments).

This has been an epically long blog post…if I haven’t bored you to death, thanks for making it this far. I could write more about the mistakes I made and the lessons I learned along the way, but–for now–I hope this helps you chart your course to success and financial stability!

Work, Hustle, Repeat,
j*

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FREE PRODUCTIVITY PLANNER

Life is about to get a whole lot easier.  

Desperate for change, I created a Productivity Planner to help streamline my workflow and I kissed stress goodbye. 

[With cherry flavored chapstick.]  

FREE INSTAGRAM GUIDE

Oh, friend, it's time to start growing your business on Instagram.
  
Sign up to receive a free Instagram marketing guide, helpful tips, and free stock photos you can use for your business.  

It’s basically an Instanote sent to your inbox to help push you toward your social goals and help grow your following.

FREE STOCK PHOTOS

You're busy, pulled in lots of directions, and trying to run a business. 

In addition to all this, you know you should be posting on social media, so how do you balance it all? 

I'm dedicated to your success, so download five free stock photos to use online...I hope this empowers you to attract dream customers along the way!

I wouldn’t say we were business nerds but my husband just sent me a Slack message asking me to call him.

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