making money and selling beats

  1. 2 weeks ago

    spacedoutbeats

    Jan 4 User since 2016 + 411 RP

    I have a question to all you guys...
    at the end of the year, money u made selling beats do you have to report that when u fill out taxes? if so how u do when u have to report taxes does @soundgine send u a tax form/w2 or what? do u guys have any info on how to legally go about this mater? because it still an income!

    Thanks
    Spacedoutbeats.com

  2. last week

    Soundgine

    Jan 5 Administrator User since 2014 Los Angeles + 13848 RP
    Edited last week by Soundgine

    Since we don't touch any money between the buyer and yourself, you get tax information from Paypal. Stripe or both. They both give have printouts ready at their website.

  3. an0nym0u5beats

    Jan 6 Power Contributor User since 2016 Los Angeles + 1780 RP
    Edited last week by an0nym0u5beats

    My advice, if you are doing this for a living, or are making a decent amount of money selling and licensing beats, hire a CPA and look into forming an SCorp or LLC. The benefits of doing this is astronomical, ESPECIALLY when it comes to paying taxes. You are taxed as an individual at a MUCH hire rate than a corp or LLC. And now with the new tax plan thats been implemented here in the US, us business owners are getting an even better tax break now.

    Filling for a Corp or LLC is also a great way to legally write off MANY MANY more expenses and purchases related to what you do as a business than an individual. Equipment, programs, plugins, software, travel, hardware, food, you name it, if its deemed suitable for your business, it can be written off.

    Your Soundgine subscription you ask? Bet your a$$ that can be a write off ;)

  4. Ibsenproducer

    Jan 7 Power Contributor User since 2016 Venezuela + 1356 RP

    @an0nym0u5beats My advice, if you are doing this for a living, or are making a decent amount of money selling and licensing beats, hire a CPA and look into forming an SCorp or LLC. The benefits of doing this astronomical, ESPECIALLY when it comes to paying taxes. You are taxed as an individual at a MUCH hire rate than a corp or LLC. And now with the new tax plan thats been implemented here in the US, us business owners are getting an even better tax breaks now.

    Filling for a Corp or LLC is also a great way to legally write off MANY MANY more expenses and purchases related to what you do as a business than an individual. Equipment, programs, plugins, software, travel, hardware, food, you name it, if its deemed suitable for your business, it can be written off.

    Your Soundgine subscription you ask? Bet your a$$ that can be a write off ;)

    How much does it cost to create an LLC? This could also be used as an publisher company right?

  5. an0nym0u5beats

    Jan 7 Power Contributor User since 2016 Los Angeles + 1780 RP
    Edited last week by an0nym0u5beats

    @Ibsenproducer ; check out https://www.legalzoom.com/ . This is the company I used to set up my DBA many years ago. This is the minimal type of "business" entity that you can set up that will allow you to get a business account at a bank and have checks with the company name on it. This way, I have a separate checking/savings account and debit card for all my "business" transactions. Amazing way to keep track of all your expenses come tax deduction time ;)

    I later upgraded to an S-Corp shortly after, (when i got a CPA) as the tax benefits are much better for a Corp or LLC. A DBA is just a "doing business as" company, that allows you to do business in a certain state under a name that is different than your own, but you are taxed just like an individual. So the only real benefit of a DAB is the business account and checks that you can write and cash as your business name. Looking back, if I knew more about it all, I would have just started off with a Corp or LLC, you get the same benefits as the DBA but with many many more extras as well.

    Honestly, depending on how much of an income you are making with your beats/licenses, would really justify weather or not to spend the money on starting up a Corp or LLC. There are yearly costs associated with each as well, so that's something to consider, yearly state fees, business license fees. The minimum yearly fee here in Cali just to have a business is $800, then goes up depending on income. But this is where a good CPA comes in. They will make your life easy when it comes to worrying about all the fee's and licenses and timelines so you can focus on your music, but don't forget, they cost money as well. But the good news is, their services and some of the fee's you pay can be written off as well ;)

    To answer your question @Ibsenproducer ;, i believe LegalZoom LLC start at $149 and go up depending on what other services you sign up for and local license fees you have to pay during the startup. And yes, you can definitely use your company for publishing, just be aware, when you set up the company, you have to tell the state what it is that your in business for and its not wise, or legal, to be doing any other business than what you are licensed for. I would talk to a CPA and tell him what it is that you want to do, and they will tell you the best type of business, SCorp, CCorp or LLC, to set up and under what category you should be doing business. Your CPA can also set up the business for your, I had used legal zoom because thats who I originally used when I set up my DBA before upgrading to the S-Corp and finally getting a CPA.

 

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