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Why form a separate business entity for my band?

Forming an LLC or corporation for your band will provide you with many benefits, including:

  • Liability protection: Business formation will establish your band as a separate legal entity. Because the band is a separate entity, you and your bandmates will not be held personally liable for the band's debts.
  • Record label protection: The music you create with your band can be owned by the band as a separate entity. This provides the record label with protection. Should you and your band part ways, there will be no dispute as to who owns the music.
  • Establishes member roles: When forming your entity, you can define musician rights and responsibilities and ensure each band member understands their role.
  • Makes it easy to lease equipment: When you form a separate business entity for your band, you make it much easier to lease or finance equipment. Instead of an individual band member being liable or legally responsible for equipment debts and financing instruments, the equipment can be leased through the business entity.
  • Tax benefits: Bands may also enjoy tax benefits as a result of forming a separate entity. Bands might be able to write off the deprecation of instruments purchased through the entity or debts incurred while touring.

What type of entity should we form?

The entity type you choose will depend on your needs. However, most bands will form an LLC. An LLC does not have as many corporate formalities and will allow you to incorporate musician rights and rules as you see fit. The LLC that you form will be governed by an agreement that every member of the band will adopt. This gives you and your band the freedom to structure the company as you see fit.

Corporations and partnerships are also options, but may not be as beneficial. Corporations, in particular, tend to be more complex and require more responsibilities.

Still not sure what type of entity you wish to form? We can help you with information about business formation options for your band and our business services experts can file the paperwork on your behalf.

How do I form a business entity for my band?

Forming a separate business entity for a band is similar to business formation for a more traditional business. Once you have determined what type of entity you wish to form, you can obtain the necessary paperwork to establish the entity. Contact your secretary of state or the office responsible for registering your state's corporations. Be sure to inquire about which forms you will need, the fees you will have to pay, and the instructions on how to proceed.

While it is possible to prepare and file the necessary business formation paperwork for your band on your own, working with filing specialists, such as the business service experts at Rocket Lawyer, can save you time and headache, and all for an affordable price. If you have legal questions, you can also reach out to a Rocket Lawyer network attorney for affordable legal advice. 

This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.

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