LLC, S Corp, or Sole Proprietor?

Which One’s Right for You as an Actor?

When it comes to money, most actors focus on what’s coming in… but the smartest actors also think about how it comes in.

If you’ve been freelancing, gigging, or working project to project, it’s time to ask yourself a bigger question:
Should I be operating as a business?

The answer? If you want to maximize your write-offs, protect yourself legally, and pay less in taxes, the answer is yes.
But now the real question becomes: What kind of business structure is right for you?

Let’s break it down.

 1. Sole Proprietor

This is the default for most freelancers. If you’ve never set up a company, you’re likely operating as a sole proprietor.

Pros:

• Easiest to set up (no registration required)
• All income goes directly to you
• Simple tax filing

Cons:

• No legal separation between you and your work
• Fewer write-off opportunities
• Harder to scale as your income grows

Best for: Beginners just getting started or actors with minimal freelance income.

 2. LLC (Limited Liability Company)

An LLC is a legal business entity that protects your personal assets and opens the door to more financial flexibility.

Pros:

• You can open a business bank account
• Increased credibility with clients & networks
• Your personal assets are protected from lawsuits or business debts

Cons:

• Taxes are still taken out unless you apply to be taxed differently (see S Corp)
• You’ll need to file formation paperwork and pay annual state fees

California actors, note: You can’t operate as a loan-out just with an LLC anymore. You must apply to be taxed as an S Corp if you want to be paid without taxes taken out.

3. S Corp (S Corporation Status)

This isn’t a type of business, it’s a tax classification you apply for through the IRS.

Here’s the move:
Form an LLC → Apply for S Corp status with the IRS

Pros:

• You can pay yourself a salary and take owner distributions
• You avoid self-employment tax on the full amount of your income
• Many talent agencies, studios, and payroll companies require this setup

Cons:

• More paperwork and compliance
• Must pay yourself a “reasonable salary” via payroll
• You’ll likely need an accountant

Best for: Working actors with consistent income, especially from union jobs or agency work.

 So What’s Best for You?

• If you’re just getting started → Sole Proprietor is fine for now
• If you’re starting to make consistent income and want to separate your money → LLC
• If you’re making $75K+ or getting regular checks from jobs → LLC taxed as an S Corp

Bonus Tip:

Once you’re set up as a business, the doors open wide. You can now write off equipment, studio space, wardrobe, mileage, coaching, courses, and more. It’s the difference between acting like an actor and operating like a business.

Want the Tools to Do This Right?

Our Actor Financial Toolkit is a step-by-step guide to help you:
✅ Understand business structures
✅ Track income & expenses
✅ Prep for taxes
✅ Learn what you can really write off

All for just $9.97.
Click [here] to get it now.