Module 2.1: Limited Liability Protection

Both LLCs and C-Corps provide limited liability, meaning your personal assets (home, car, savings) are protected from business debts and lawsuits.

This protection is particularly important for artists who may face contract disputes, copyright issues, or other business-related legal challenges.

Module 2.2: Tax Benefits and Obligations

The tax treatment of LLCs and C-Corps differs significantly, and understanding these differences is crucial for making the right choice for your artistic business.

LLCs offer pass-through taxation, which means the business itself doesn't pay taxes. Instead, profits and losses pass through to the owners, who report them on their personal tax returns.

C-Corps, on the other hand, are separate tax entities. The corporation pays taxes on its profits, and then shareholders pay taxes on dividends they receive, which can lead to double taxation.

Module 2.3: Ownership and Flexibility

LLCs offer more flexibility in management and ownership structures, while C-Corps provide opportunities for raising capital through stock issuance.

For most independent artists, the flexibility of an LLC is often preferable, especially when starting out. However, if you plan to seek significant investment or eventually go public, a C-Corp might be more appropriate.