Topic: Setting Up Your Business
Time Investment: 5 Minutes
Suggested Product: All-in-One Contract Bundles
My husband is great at helping cook, clean and get things ready for my “last-minute-must-throw-a-Pinterest-worthy-party-although-I-didn’t-plan-anything.” So he ends up bearing the brunt of picking up the food I failed to plan for – and bless him- he tries.
Yes, he’s going to kill me for this sharing this.
So I’m full out trying to throw this party for guests by setting it up at home, he arrives with all the requested condiments and everything to dress the main dish.
But when he purchased the main dish he picked up Italian Sausage not Bratwurst. No, not the end of the world. But it changed all of the accompaniments and the whole feel for the food that evening. Pinterest-party-idea-last-minute-change. Instead of feeling “Oktoberfest”, it was more like a summer day in Italy.
But on the surface they are similar right?
Sausages. Fit in a bun. Maybe some mustard. What kind of mustard? What about the accompaniments? Not to mention the different taste preferences of the guests.
This is very similar to the approach that some business owners take when they are seeking out a professional to help their photography business. They grab someone licensed (yay!) because the packages look similar and hope they have are the correct main-dish to set the mood of the business and fulfill the preferences and needs at that time. Except, there is a difference when you have legal questions based on the flavor of the question.
Be sure you are choosing a professional that your business is hungry and has a taste for – not just one that looks like it may satisfy.
Okay okay, enough of the food analogy.
Certified Public Accountants (CPAs) and Lawyers have the licenses and knowledge to help set up your business – but depending your specific situation you may need a taste of CPA over a lawyer, or vice versa.
This can also change as business time goes on.
Here is a basic run down of which professional you should hire for your business based on the need. If you’re new to setting up your business or want to reevaluate check out this checklist here.
CPA and Lawyers Defined
CPAs are Certified Public Accountants that work with a range of financial matters. These can be individuals, firms or institutions that provide these services. Typically, you’ll hire a CPA for help with preparing your taxes and financial planning for your photography business. These individuals offer way more benefits than merely inputting of financial reports, as they are licensed and educated to provide strategic advice and advisement for matters you may approach in your business.
Keep in mind a CPA is a certified and licensed individual. The terms “bookkeeper” or “tax-preparer” may be erroneously used interchangeably for the designation of CPA- and does not always relay whether an individual try has the licensure or not.
Lawyers are individuals who are licensed at a State level, to practice law. Lawyers are generally licensed (there are exceptions) but often specialize in the type of cases they take on. It is important to find a lawyer who is well versed in business transactions to properly and fully assist with your photography business. I will warn you – you’ll be hard pressed to find lawyers who have run a photography business to give this complete view but we do exist out there!
What to ask a CPA:
- Best business formation for me (based on taxes)
- Tax strategy and planning
- Advisement on tax situations
What to ask a Lawyer:
- Best business formation for me (based on liability)
- Contract creation and review (you can also snag templates from TheLawTog for use or to take with you to reduce drafting fees and time!)
- Advisement on client situations
A Mistake Many Photographers Make
Many times small business owners, especially photographers, are erroneously told to just “hire a CPA” to set up your business. It is actually recommended to seek out the advisement of both types of professionals, lawyer and CPA. As you can see from the definitions here, both are licensed but are experts on different matters completely.
A CPA may be well equipped to help set up your photography business from a tax standpoint (tax liability, strategy, etc.) but may not be experienced in helping you choose the right business structure for your business – this is where lawyers come in.
Lawyers are required to study business transactions and this subject is a portion of their licensing exams, therefore, they have the knowledge to provide advisement on legal formation matters.
How do I find these professionals?
It is recommended to always start with word-of-mouth recommendations by other local small business owners. I have a list of recommended professionals here.
If you don’t know of anyone with a recommendation, start with the State Bar website to search for lawyers in the business arena and check out their credentials. Simply Google “State name State Bar Association”. Directories are public and free to search.
Both of these professionals are necessities to business formation and management as they are required to have continuing education to keep their licenses current and up-to-date.
Always set up review times with these professionals to ensure you’re updated to the most current set of laws and see if changes need to be made as your business grows.