Summary

Shawn Bartley is a business lawyer in Maryland. In our discussion, he shares practical steps we can take to protect our music studios, collect payment, and minimize our tax burden. We discuss what to include in teacher and student contracts, what records we should keep in case we need to defend our businesses in a tax audit or in court, and we discuss some of the hard choices teachers have to make.

Takeaways

Shawn’s tips to make sure you get paid:

1. Have a contract
   1. Include business information and terms of service
   2. Have signature lines with business name
   3. An attorney can help create your contract to ensure it suits your business’ needs
2. Make sure clients honor the contract
3. Keep record of all money spent and received
   1. Provide receipts

Shawn’s tips to strengthen your business:

• Register as a limited liability company (LLC)
• Obtain biographical information from clients in case receiving payments becomes an issue in the future
• Record any correspondence between you and the client regarding payment
• Establish non-compete agreements with hired teachers (independent contractors) or other employees
• Have a rider for your insurance policy if your studio is run out of your home
• For home studios, consider treating your home or instrument as leased property between the homeowner (you) and the business owner (you), as there is potential to legally write this off as a business expense

Resources

Previous Podcast: Episode 012 – Andrea Yahr on Business Structures and Their Tax Implications

Connect with Shawn

Website: http://bartleylegal.com/ or http://bartley-law.com/

Phone: (301)741-4123