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Do you need a Business License, LLC or Trademark for your Podcast?
Back to Legal and Business Affairs Basics for Podcasters. Do you need a Business License, LLC or Trademark for your Podcast?
Welcome to another episode of Legit Podcast Pro, hosted by Gordon Firemark, The Podcast Lawyer™. In this episode, we discuss the legal and business affairs basics for podcasters, including business licenses, LLCs, trademarks, and more.
First up, Gordon addresses a question from Rachel in the podcast support community on Facebook, who asked whether she needs a business license for her podcast. He explains what a business license is, what it's not, and why you might need one or not. He also discusses the First Amendment's role and relevant cases, including a Philadelphia case and Los Angeles screenwriter cases. Gordon shares his own business license situation from years ago, and offers a call-to-action for listeners to visit http://podcastlawforms.com.
Next, Gordon talks about LLCs and whether you need one for your podcast. He explains what an LLC is, what it's good for, and how it offers liability protection, tax and banking benefits, a separate identity, capitalization, and structure. Gordon emphasizes that an LLC is a form of "podcast prenup" for survival and shares how to get an LLC, including filing articles, creating an operating agreement, appointing an agent for service, issuing membership certificates, filing a statement or report, managing taxes, creating bank accounts, keeping records, and making contracts with the LLC and not individually. Gordon warns against using rocket/zoom/law online services and offers a call-to-action for listeners to visit http://easylegalforpodcasters.com
Gordon then discusses trademarks for your podcast, explaining what a trademark is, why you need one, what to trademark, how to get a trademark, and how much it costs. He offers a call-to-action for listeners to visit http://firemark.com/trademarks for more information and a consultation.
Finally, Gordon emphasizes the importance of having a written consent and release from guests in your podcast and recommends visiting http://podcastrelease.com.
Don't miss our FREE on-demand training: "Podcast Legal and Business Affairs: Big Mistakes & Easy Solutions". Register and access it now by visiting https://www.gordonfiremark.com/podcastertraining
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Transcript
Back to legal and business affairs, basics for podcasters, business
Speaker:licenses, LLCs, trademarks, and more.
Speaker:On this episode of Legit Podcast Pro.
Speaker:Welcome to another episode of Legit Podcast Pro, where I share tips
Speaker:and strategies and information to help creative folks like you make
Speaker:your content, have your impact and achieve influence without fear
Speaker:or worry about the legal stuff.
Speaker:I'm your host, Gordon Fire Mark, the podcast lawyer, and this week we're
Speaker:looking at a question I saw on, uh, in the podcast support community on Facebook.
Speaker:So, uh, let me get that open here for you.
Speaker:And
Speaker:so the question came from, um, Rachel, who asked the question about whether she
Speaker:needs a business license for her podcast and, uh, There were lots of opinions.
Speaker:Most were about other things like entities and taxes and DBAs and things like that.
Speaker:So I just want to address the actual question for a second here.
Speaker:You can see Lee saying, well, it all depends on the state and the form
Speaker:of your business, and had to file a fictitious business name statement.
Speaker:That's another name for a dba.
Speaker:Um, but not in Tennessee.
Speaker:And I would still get a tax ID number from the irs, and that's
Speaker:not answering the question.
Speaker:Here's another one, talking about a partnership llc, and so
Speaker:on and so forth, and I'll talk about those things a little bit.
Speaker:But to answer the first question, do you need a business license for your podcast?
Speaker:Well, unfortunately the short answer is, Maybe, and the thing about it
Speaker:is, in this question, Lee is correct.
Speaker:It does depend on what state, actually what city you are located in.
Speaker:So let's start by talking about what a business license even is.
Speaker:A business license is.
Speaker:Essentially a certificate that you've paid your taxes, a tax,
Speaker:uh, a business tax certificate.
Speaker:And in many places the tax is actually sort of a property tax so
Speaker:that when you file it, they actually ask you what business equipment
Speaker:you have and so on and so forth.
Speaker:So what it's not is any specific permission to do what you're doing,
Speaker:which is what a license would maybe suggest is, is what's going on.
Speaker:It's not.
Speaker:Um, anything that, that you need to get just in order to, you know, like a license
Speaker:to drive or a license to, uh, to operate, uh, a restaurant or something like that.
Speaker:Those are other things.
Speaker:They come, you know, they're permits from the health department
Speaker:and, and things like that.
Speaker:You do not need anybody's permission to make a podcast.
Speaker:You don't need anybody's permission to speak your, your message to, to
Speaker:share your message because that's what freedom of speech is all, all about.
Speaker:Now, you might though, Need a business license to operate a business and
Speaker:a podcast need not necessarily be a business, but if you are intend,
Speaker:it sort of depends on your mindset.
Speaker:If you are intending to make it a business, if you're intending to monetize
Speaker:what you're doing, then there's a good chance that you would need one, but
Speaker:you might not need one if all you're doing is just, you know, getting
Speaker:together with a friend and recording a show and putting it out there to
Speaker:see what people, what people think.
Speaker:And chances are even.
Speaker:Even if you did monetize it through your hosting company or or whatever,
Speaker:and you collect a few bucks here and there, chances are that's not
Speaker:going to really amount to being in business for our purposes.
Speaker:So you might not need one, but ultimately you really have to
Speaker:check in with your local authority.
Speaker:Usually this is a city level.
Speaker:Uh, business license tax.
Speaker:And so you're gonna wanna call your city or write or, or check
Speaker:out their website or whatever and find out what the criteria are.
Speaker:It's different for different kinds of businesses as well.
Speaker:So if you think of yourself as media as the press, uh, oftentimes,
Speaker:uh, there's exemptions for.
Speaker:Newspapers and, uh, radio and television station because a First Amendment, the
Speaker:first Amendment is really strong here.
Speaker:It protects your rights to free speech.
Speaker:Now, there have been a couple of cases in my history as a lawyer.
Speaker:I've been practicing a little over 30 years, and, uh, long time ago, back in the
Speaker:mid nineties, early in my career, there was a case that arose out of Philadelphia.
Speaker:And I just need to tell you back then, obviously there weren't podcasts
Speaker:and, and live streaming and things like that, but there was a blogger.
Speaker:Who was writing blog posts from his or her home in the city of Philadelphia and.
Speaker:Um, and on the blog website had a banner ad, you know, Google AdWords kind of
Speaker:banner ad or whatever it was a, and uh, was receiving a little bit, I think it was
Speaker:like 31 cents this person had received.
Speaker:Citi said, Hey, you're in business.
Speaker:That's money coming in.
Speaker:You need to pay taxes.
Speaker:And the minimum, you know, the basic tax for a business license in
Speaker:Philadelphia was hundreds of dollars.
Speaker:So it was a big bruhaha and that.
Speaker:Uh, blogger ended up, you know, making a lot of noise about it.
Speaker:And ultimately I don't, I, I never followed up on how it actually turned
Speaker:out, but I believe the, you know, the path of least resistance was to pay the money
Speaker:and, and, uh, grit your teeth about it.
Speaker:Here in Los Angeles where I, at the time and still do represent screenwriter,
Speaker:uh, this, a similar thing was going on where the city of Los Angeles said,
Speaker:Hey, screenwriters are in business.
Speaker:Yeah.
Speaker:All they do is sit there typing on a computer or back then
Speaker:it's even typewriters and.
Speaker:That's a, a form of business and they need to pay, um, a, a business license tax.
Speaker:And there were a few cases where the screenwriters litigated it, uh,
Speaker:usually because they'd received a, a penalty notice or something like that.
Speaker:And I think it went sort of both ways a bit.
Speaker:And again, I don't think anybody ever took it all the way for, uh, uh, full outcomes.
Speaker:I'm gonna have to go dig into that and find out a little more
Speaker:my own situation as a lawyer.
Speaker:Uh, at one point in my career, I.
Speaker:Uh, decided not to have a, a, a live, a real office in an office building.
Speaker:And instead I rented a, um, what's called a virtual office, uh, at an
Speaker:executive suite where they'd answer my phones and, uh, and my mail
Speaker:would go to this particular address.
Speaker:This one was in Beverly Hills.
Speaker:It was a lovely space.
Speaker:If I needed to go and have a conference with somebody, I could meet them there
Speaker:if I wanted to, but about two or three times a week, I would drive over to the
Speaker:office, the building in Beverly Hills.
Speaker:Pick up my mail and leave.
Speaker:If I spent 15 minutes in the building in any given week, that was unusually long.
Speaker:The city of Beverly Hills because the, that company, uh, put my
Speaker:name on a sign in the lobby.
Speaker:Uh, the City of Beverly Hills concluded that I had a business in the city
Speaker:and they wanted me to pay the taxes, the business license tax, which in
Speaker:the city of Beverly Hills, as you might imagine, was rather expensive.
Speaker:So, , I closed that office address.
Speaker:I, I moved to a different, uh, uh, business address and, uh,
Speaker:avoided that problem going forward.
Speaker:Uh, however, I.
Speaker:Uh, it's theoretically possible to get wrapped up in this kind of thing.
Speaker:So if you are podcasting from your home and not from a business address and you're
Speaker:causing nobody any harm, and you're sort of under the radar, you can probably get
Speaker:away with without a business license, even if technically the law says, You need one.
Speaker:Now, as a lawyer, I can't give you the advice.
Speaker:First of all, this is a podcast, not an advice, uh, venue.
Speaker:But I'm not giving you legal advice, but I'm just saying some people get
Speaker:away with it for years and years and years and never get caught.
Speaker:So, uh, it's, it's a judgment call on how you want to handle that.
Speaker:Um, Obviously the best thing is just, you know, do the do things right so you don't
Speaker:end up suffering consequences later on.
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Speaker:If you are a legit podcast pro, you wanna protect your intellectual
Speaker:property and ensure that content is used appropriately Easy.
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Speaker:podcast law forms.com.
Speaker:All right, the next question I want to get to as we proceed through our discussion
Speaker:of business and legal affairs basics is, do you need an L L C for your podcast?
Speaker:Well, let's get into that.
Speaker:It's a common discussion in the various online forums and there's a lot of strong
Speaker:opinions about this, mostly from people who haven't really thought it all through.
Speaker:Now, that said, it is entirely possible that you will think it all
Speaker:through and conclude that you don't.
Speaker:Or that you do, and I'm just here to give you some information.
Speaker:Hopefully that will inform your decision making about these kinds of things.
Speaker:So when we talk about an llc, we're talking about a limited liability company.
Speaker:This is a legal entity that is recognized in most of the United States.
Speaker:I think it's all the states in the US now recognize limited liability companies.
Speaker:What's an LLC good for?
Speaker:Well, the key thing, the one that most people.
Speaker:Point two right off the bat is liability protection because the L L C is a
Speaker:separate person in the eyes of the law and stands in the place of, or, or, uh,
Speaker:protects, I guess you could say shields.
Speaker:Its owners from liability for things that arise within.
Speaker:The company's business.
Speaker:So that liability protection, it's, it's like a corporation in that regard.
Speaker:That's the other form that you might use.
Speaker:Here's the thing.
Speaker:Most of the time when two people, when one or two people hang out a shingle
Speaker:and just start doing something, any kind of a, a business-like endeavor and
Speaker:yes, podcasting, it looks like business.
Speaker:Anytime you do that, you are exposing, I.
Speaker:The owners are exposing themselves to liability.
Speaker:Someone infringes a copyright, there's a breach of a contract, there's a statement
Speaker:made that hurts somebody's reputation liable or slander, those kinds of things.
Speaker:And, um, and uh, all of those kinds of things can bring
Speaker:lawsuits and liability and risk.
Speaker:Now, insurance is certainly one smart way to handle those kinds of things,
Speaker:but if you've got any, Value in your personal asset pool, a home cars,
Speaker:bank accounts, those kinds of things.
Speaker:It is well worth it to separate yourself from the entity that
Speaker:incurs that kind of liability.
Speaker:And an LLC is a great way to do that.
Speaker:Another thing that LLCs offer is tax and banking advantages.
Speaker:One, you can open a bank account in the name of the company and keep the funds,
Speaker:the income and the outgo separate.
Speaker:And many of the things that you can deduct at the business level can't be
Speaker:deducted by a person as an individual.
Speaker:So things like a health plan, things like a, uh, reimbursement plans,
Speaker:benefits programs, all those kinds of things that you pay for as a
Speaker:company that benefit the owners.
Speaker:The owner, if they bought those things on the open market, wouldn't
Speaker:be able to take a a tax deduction.
Speaker:So, uh, tax and banking advantages can exist.
Speaker:The separate identity, of course, is a very important
Speaker:thing for other reasons too.
Speaker:And, and it frankly just provides sort of a kind of credibility.
Speaker:A lot of folks prefer to do business with a company.
Speaker:It gives a sense of stability and, and, uh, and permanence or duration.
Speaker:And that is, Actually a component.
Speaker:Another area is capitalization.
Speaker:If you need to raise money for a company, uh, to, for the operations of
Speaker:the business, you can sell membership or ownership shares of the company as
Speaker:a way of raising that capital and still retain, um, management and control
Speaker:of the company in, in certain ways.
Speaker:Now, this is starting to get into some complex.
Speaker:Legal structuring, but that's one of the advantages it's possible to do
Speaker:that structure of ownership and the management and control of the company.
Speaker:Now, this is actually a form of a podcast prenup that I talk about.
Speaker:If you're working with more than one person, you absolutely need to have
Speaker:some kind of an agreement or, or documentation or structure in place
Speaker:to clarify who owns what, who gets what, who's responsible for different
Speaker:things, all those kinds of things.
Speaker:And finally, another thing the L L C can offer.
Speaker:Is survival.
Speaker:If one of the owners or members of the L l C stops being a part of it for one
Speaker:reason, becomes disabled, dies, just chooses to check out whatever the business
Speaker:can continue on without them, and the, uh, ownership of property doesn't have to be
Speaker:transferred and all those kinds of things.
Speaker:So that can be really valuable.
Speaker:Now, how do you get an llc?
Speaker:Well, it's not very complicated.
Speaker:Uh, it's the kind of thing you can file, uh, the articles of organization
Speaker:with your local Secretary of State.
Speaker:Uh, then once they've stamped it and sent it back to you, you prepare
Speaker:an operating agreement that is the governing document of the company,
Speaker:and it outlines the relationships of the various parties and owners of the
Speaker:company, even if you're a single member.
Speaker:Llc, you should have a, a formal written operating agreement that documents
Speaker:these things cuz you never know when somebody else comes in or when you
Speaker:die and leave it to your children.
Speaker:And they, the multiples, you know, they need to figure things out.
Speaker:You appoint an agent for service of process.
Speaker:That's another part of the filing with the, the state when you register your
Speaker:llc and then you issue your membership interests and certificates and file
Speaker:a statement, an annual statement with the, uh, With the state where
Speaker:you're located, you pay your taxes and this allows you to open your bank
Speaker:accounts and, uh, you have a little bit of record keeping responsibility
Speaker:and ultimately any contracts that are being made would be made between the
Speaker:LLC and the other party rather than the individual person, the owner.
Speaker:And the party.
Speaker:So if you need an llc, please don't use those.
Speaker:Rocket Zoom lawyer online kind of vending machine services.
Speaker:They botch them as often as they get 'em, right?
Speaker:And I like to use the analogy of a, of a haircut machine.
Speaker:If you were walking down the street and you saw a vending machine, big
Speaker:box hanging about eye level with a hole in the bottom that says, Hey,
Speaker:haircuts $1, stick your head in here.
Speaker:Would you put your head in there?
Speaker:Of course not.
Speaker:And you might get a decent haircut or you might wind up missing an ear.
Speaker:Really, if you're, if you're anything but a plain vanilla shape and size
Speaker:of head, it's gonna be a problem.
Speaker:And every company, every LLC is a little bit different.
Speaker:So, Uh, that's why I bring it to your attention.
Speaker:Just, you know, this is the kind of thing where you can do it yourself.
Speaker:If you have the kind of help that we offer over at Easy Legal for Podcasters,
Speaker:visit Easy Legal for podcasters.com for a little more information about all that.
Speaker:That is my signature online course where I actually walk you through.
Speaker:The step-by-step processes to forming your entities, uh, protecting your
Speaker:intellectual property, uh, documenting the relationships with all the people
Speaker:on your team, and of course, when it comes down to monetizing the deals that
Speaker:you're gonna make with your clients and customers, your advertisers and
Speaker:sponsors and those kinds of things.
Speaker:So, uh, forming an LLC I think is a good idea, but you've gotta weigh
Speaker:the cost benefit because after all, in some places, those taxes can
Speaker:really be well, you know, pretty.
Speaker:Pretty significant.
Speaker:Um, so, uh, you know, that's something to just give some thought to.
Speaker:Now.
Speaker:The third question I want to address in today's, uh, uh, in today's
Speaker:session is whether or not you need a trademark for your podcast.
Speaker:Trademarks are distinctive brands, distinctive words or symbols or logos
Speaker:or marks or those kinds of things that are affixed to goods or services that
Speaker:are in the marketplace, um, in commerce to distinguish them, to set them aside
Speaker:to so that the audience, the customers know, Where this is coming from, think
Speaker:of the Red Nabisco logo on the upper corner of that box of cookies or crackers.
Speaker:Think of the Nike swoosh mark on the side of its shoes and clothing.
Speaker:Think of the little polo, a little polo player or, or alligator
Speaker:on, uh, the chest of a shirt.
Speaker:These are things that tell you what company this comes
Speaker:from, and those are trademarks.
Speaker:Well, the title of your podcast can be a trademark.
Speaker:If it's distinctive that is not generic or merely descriptive,
Speaker:you can protect it as a trademark.
Speaker:And what that protection does is it affords you the opportunity to put a
Speaker:stop to other people using confusingly similar brands, logos, sims, things like
Speaker:that that would confuse the audience, the marketplace, as to whether it's
Speaker:your show or theirs and, and whether there's a connection or support or, or
Speaker:endorsement or those kinds of things.
Speaker:So should you get a trademark?
Speaker:Well, If you have that distinctive title, or, and this also goes for
Speaker:like a, a distinctive show segment or a feature or something like that.
Speaker:You can also trademark those kinds of things.
Speaker:Uh, it makes sense in many instances to do this, uh, especially if your, uh, title
Speaker:is the kind of thing that you anticipate.
Speaker:People will come in and, and, you know, try to confuse yours with
Speaker:theirs, those kind of things.
Speaker:So you get a trademark by filing a document with the government.
Speaker:Uh, it's, uh, Uh, it, it's a relatively straightforward process.
Speaker:It's, it's not hard, although it's very detailed and technical, and you
Speaker:really need to know a little bit about trademark law, the lingo, and how
Speaker:to describe the goods and services and, and those kinds of things.
Speaker:The process takes about a year from the start of the filing to, to getting,
Speaker:uh, a finished, registered trademark.
Speaker:But, uh, it is worth doing.
Speaker:The cost of doing it ranges.
Speaker:Uh, the government fees are about $350 for each mark, for each class of
Speaker:goods that the mark is registered in.
Speaker:And that's an important thing is, you know, if you have, uh, a particular
Speaker:mark in the podcasting space, you're probably not gonna be able to stop
Speaker:somebody from using the same name.
Speaker:For their medical devices or chewing gum or sneakers or something like that.
Speaker:But you should register in two classes for a trademark.
Speaker:That's one for the downloadable audio file, which is a product as well as
Speaker:for the entertainment service that you provide when the show is streamed.
Speaker:So those are two separate classes, so you're looking about, you
Speaker:know, $700 in government fees and the legal fees will range.
Speaker:Now, if you'd like to know a little more about this, you
Speaker:can come on over to fire.com/.
Speaker:Trademarks and, uh, we have more information there on the website.
Speaker:Fire mark.com/trademarks, plural.
Speaker:And, uh, you can even click the button and sign up for a free consultation
Speaker:to talk to me in a little more depth about your brand, about your show,
Speaker:and whether or not you, uh, uh, you want to register your trademark.
Speaker:Um, so, uh, the one document though, back to our, our topic, the one document that
Speaker:I say you must have for your podcast, whether you form an llc, whether you do
Speaker:a business license, whether you register your trademarks, one thing that every
Speaker:podcast, at least every podcast that has guests on the show needs is their
Speaker:consent and release to you recording them and publishing the episode.
Speaker:And that release really should be, A written release, a document that
Speaker:they have acknowledged and signaled that they intend to be bound.
Speaker:And I'm happy to offer one for you over@podcastrelease.com where you
Speaker:can come and get that, uh, that guest release absolutely free.
Speaker:I hope you'll join me, uh, in, uh, in crusading for this.
Speaker:More people need to do this.
Speaker:Alright, that's gonna be it for this episode of Legit Podcast Pro.
Speaker:And, uh, I look forward to speaking to you again really, really soon.
Speaker:When I come back next week.
Speaker:I'm Gordon Fire.
Speaker:Mark the podcast lawyer, and I'll see you again really, really soon.
Speaker:Tanaya.
Speaker:Hi, I, I hope you're still here.
Speaker:I see that you posted a question in the comments, and I just wanted to, uh, touch
Speaker:base with you licensing footage and how much to charge, um, from the, from that.
Speaker:It sounds like you are the owner of that footage.
Speaker:Tanaya.
Speaker:If you're still here, just say hi again in the, in the chat and I'll let you know.
Speaker:Otherwise, we'll talk.
Speaker:Right.
Speaker:It says you, uh, You reached out to me by Facebook, so you can,
Speaker:we can do that too, but, uh, I'd be happy to answer your question.
Speaker:So how, how does licensing work and how much to charge?
Speaker:Well, if you are the owner of a copyright work, some material that other people want
Speaker:to use, you are in a position to license that footage or material to them, and you
Speaker:can charge whatever the market will bear.
Speaker:The real question is, What will the market bear?
Speaker:Uh, and there's a lot of different ways to charge.
Speaker:The most common is just a flat fee.
Speaker:Hey, you're gonna use it for this purpose.
Speaker:It's this many dollars.
Speaker:Uh, but if they're gonna be releasing something that's gonna be used over and
Speaker:over and over again, well, you might want to ask for a royalty that is some
Speaker:percentage of their earnings or revenues or profits or something like that.
Speaker:Or it could be a fixed amount per.
Speaker:Copy or per thousand downloads or, you know, sort of depends.
Speaker:So, uh, I see you left me that Facebook message.
Speaker:I'm gonna just invite you to reach out to me.
Speaker:You can go to fire.com/consult, two zero and uh, that's fire
Speaker:f i r e ark slash consult.
Speaker:2 0 20.
Speaker:That'll get you a free 20 minute consultation with me, and I'd be
Speaker:delighted to chat with you a little more about this and, uh, see if we can
Speaker:get you pointed in the right direction.
Speaker:Hey, Bashir, it's nice to see you.
Speaker:I'm glad you're, you're checking in.
Speaker:Uh, I am, uh, I am, uh, always happy to see you.
Speaker:And that's that, yeah, tonight if it's rare footage that drives the price up.
Speaker:Absolutely.
Speaker:So that's cool.
Speaker:Very cool.
Speaker:In fact, All right.
Speaker:I think that's gonna be it for today.
Speaker:I'm gonna sign off and say, have a wonderful day, and, uh,
Speaker:I'll see you again next week.
Speaker:I'm going to VidCon tomorrow, so I'm gonna be out of the office.
Speaker:Looking forward to seeing people in the YouTube space and, um,
Speaker:and just visiting with folks.
Speaker:That should be fun.
Speaker:So, um, if you're gonna be there, if you're gonna be at VidCon
Speaker:on Friday the 23rd, Look me up.
Speaker:Look for me.
Speaker:I'll be there after about 10:00 AM I expect.
Speaker:Got a podcast interview in the morning and then I'm gonna jump in the car.
Speaker:My daughter Lily is gonna join me and she's into, um, meeting
Speaker:people at, at the Beth VidCon.
Speaker:So, alright.
Speaker:With that, I will sign off and say thanks for watching.
Speaker:I'll be here again next week, if not sooner.
Speaker:Have a great day.
Speaker:Have a great week.
