Songwriter Question

[PattyGirl1]

Illinois
Hi, I just started to write songs. I have one set to music and it's on a CD. It's copyrighted and I'm going to sign up with ASCAP to collect royalties as a writer and publisher. Does this have to be set up as a business since royalties, taxes, etc. will be involved. Can I just write songs and sell them to record companies or do I have to set up 'songwriting' as an established business for myself as a sole proprietor with a name, TIN ,etc. or can this be just a pastime. I hope I asked these questions correctly. Thanks
at is the name of your state (only U.S. law)?

 

[quincy]

Illinois
Hi, I just started to write songs. I have one set to music and it's on a CD. It's copyrighted and I'm going to sign up with ASCAP to collect royalties as a writer and publisher. Does this have to be set up as a business since royalties, taxes, etc. will be involved. Can I just write songs and sell them to record companies or do I have to set up 'songwriting' as an established business for myself as a sole proprietor with a name, TIN ,etc. or can this be just a pastime. I hope I asked these questions correctly. Thanks
at is the name of your state (only U.S. law)?

Have you looked into having an agent? Although the agent will have to be paid, the agent can handle the business side and you are then free to concentrate on your music.

 

[tranquility]

Illinois
Hi, I just started to write songs. I have one set to music and it's on a CD. It's copyrighted and I'm going to sign up with ASCAP to collect royalties as a writer and publisher. Does this have to be set up as a business since royalties, taxes, etc. will be involved. Can I just write songs and sell them to record companies or do I have to set up 'songwriting' as an established business for myself as a sole proprietor with a name, TIN ,etc. or can this be just a pastime. I hope I asked these questions correctly. Thanks
at is the name of your state (only U.S. law)?

While I normally accept quincy's advice ( ;<) ), I am uncertain about the reality of getting an agent under these circumstances. One must be at least a bit of a success before one gets a true agent. I suspect one can go into most any live music-themed bar in Chicago and find someone who claims to be one, but, I suspect they will not have an office or any real contacts that can make things (at least potentially) happen. It's rather like the patent mills on TV that give inventors a chance to get a patent. Either all the money is up front, or there is a no-risk way to gain some rights to your IP without them having to do anything. Until you have some sales, or a sale to an important person, I don't think a search for an agent is going to be time productively spent.

As to the rest, it doesn't seem to me that a songwriter will have a lot of liability for business matters rather than individual matters. What I mean is that a PERSON who violates another's IP can probably be sued even if the entity that sold the song is protected in some way. (Corporation, S-corp, LLC, limited liability partnership) You might gain protection from the hyper-trigger-word-sensitive's or the nutbar's who actually act on the distinction between hospital/morgue or show/go direction of slashing one's wrist that is a key component to your song from such an entity.

Realistically? While you must always talk to an attorney with knowledge of your particular facts before making a decision with legal ramifications, I think it unlikely that before you sell enough songs to...I was going to give some criteria, but cannot. At some point it is a good thing to protect yourself a bit more with an entity. I just don't think it now. The key to all that is that you don't need to start one and you don't need a separate identification number.

You will have a schedule C called songwriter. You will put your income and expenses there. If this is a "pastime", the IRS will consider it a hobby and you cannot take your losses over your income. If this is a true business where you are trying to make a profit and doing things in a professional way that indicates such, you can reduce your other income by your ordinary and necessary expenses of doing business. I would think as long as the first year or two (Or, more.) you are realistically attempting to make a profit (Even if you don't.), you can deduct your expenses. In all cases, you can subtract your expenses from any income you make.

 

[quincy]

I don't mind you not accepting the advice I gave here, tranquility.

What I wrote was admittedly tossed off rather quickly and I tossed it off mostly because there is no easy answer to PattyGirl1's questions. There are too many factors to consider. The reality is that very few songwriters/singers will make enough money from royalties to justify forming a business - but there are still registration requirements in Illinois that may need addressing.

Here is a link to older information but it is still good information, from Lawyers for the Creative Arts: https://law-arts.org/pdf/Legal_Issues_in_the_Music_Industry.pdf

I WILL recommend that PattyGirl1 register her copyrights with the US Copyright Office if she has not done so already. It is cheap ($30) insurance should she discover her songs and music have been infringed. And registration will be necessary if she needs to sue an infringer. For registration of the copyrights, she can go to the Copyright Office website for direction: http://www.copyright.gov

I will also recommend that no contracts of any kind be signed by PattyGirl1 until the terms of the contract have been personally reviewed and explained to PattyGirl1. She does not want to inadvertently sign away her rights.

For someone entering the music business, it is almost always best to sit down with a music industry professional to go over one's plans and goals and figure out how best to achieve them.

 

[tranquility]

For someone entering the music business, it is almost always best to sit down with a music industry professional to go over one's plans and goals and figure out how best to achieve them.

Avoid the couch, as you might want to stand. As an industry, the music business has...some ethical issues. One only need to look at something like:

http://pagesix.com/2016/03/20/how-madonna-mothers-exploits-and-dumps-young-talent/

to know a tiny bit of how it works. I guarantee, the thousands that did not get such "success", are even worse off.

I have a talented guitar player who I have known since a child. He was younger, but we knew each other. He's good. He has made money on being on real stars who sell CD's CD. He writes music; not songs. There are a few major "things" out there where he wrote the tune. (I say tune except I know nothing about it. I still don't know exactly how he makes the money on that schedule C. Some is playing; but, not most.) He is not the guy that is giving Taylor Swift "hooks" like "this sick beat", but, some here may have heard his music. Maybe not, but yes if you like a certain type of music.

Still, he's a schedule C or two. He makes more from giving guitar lessons then he does from writing. Good thing his wife is a nurse. It almost makes it all worthwhile. (At least taxwise.)

 

[quincy]

Avoid the couch, as you might want to stand. As an industry, the music business has...some ethical issues. One only need to look at something like:

http://pagesix.com/2016/03/20/how-madonna-mothers-exploits-and-dumps-young-talent/

to know a tiny bit of how it works. I guarantee, the thousands that did not get such "success", are even worse off.

I have a talented guitar player who I have known since a child. He was younger, but we knew each other. He's good. He has made money on being on real stars who sell CD's CD. He writes music; not songs. There are a few major "things" out there where he wrote the tune. (I say tune except I know nothing about it. I still don't know exactly how he makes the money on that schedule C. Some is playing; but, not most.) He is not the guy that is giving Taylor Swift "hooks" like "this sick beat", but, some here may have heard his music. Maybe not, but yes if you like a certain type of music.

Still, he's a schedule C or two. He makes more from giving guitar lessons then he does from writing. Good thing his wife is a nurse. It almost makes it all worthwhile. (At least taxwise.)

Many of the musicians I know make the bulk of their money from playing at different venues and not from music sales or royalties. Even though some of the performers will open for bigger acts that come to town and that is a nice paycheck, and even though many of the musicians are well-known locally, they also tend to have other jobs which provide them the monetary support they need to continue working in their preferred field.

It is definitely not an easy industry to break into successfully, although there are enough exceptions that I would never discourage anyone from pursuing a singing/songwriting career. YouTube videos have helped to launch some of these exceptions.

Following for PattyGirl1's information is a link to "Illinois Business Development" (a step by step guide):

http://www.illinois.gov/dceo/BizDevelopment/Pages/StepByStepGuide.aspx

 

[tranquility]

Many of the musicians I know make the bulk of their money from playing at different venues and not from music sales or royalties. Even though some of the performers will open for bigger acts that come to town and that is a nice paycheck, and even though many of the musicians are well-known locally, they also tend to have other jobs which provide them the monetary support they need to continue working in their preferred field.

It is definitely not an easy industry to break into successfully, although there are enough exceptions that I would never discourage anyone from pursuing a singing/songwriting career. YouTube videos have helped to launch some of these exceptions.

Following for PattyGirl1's information is a link to "Illinois Business Development" (a step by step guide):

http://www.illinois.gov/dceo/BizDevelopment/Pages/StepByStepGuide.aspx

To be fair, a "one hit wonder" can be enough for someone to retire on. Sure, it might be a van by the river, but; retire.

 

[quincy]

To be fair, a "one hit wonder" can be enough for someone to retire on. Sure, it might be a van by the river, but; retire.

Living in an Airstream by the river sounds to me like a nice retirement.