Though the record label was in news for its controversy with YouTube and for CD price fixing, the company still rules the industry and has given birth to a couple of flagship labels including Warner Bros. Records and Atlantic Records. You're responsible for paying income tax on your earnings, but the biggest concern is the personal liability you incur for your business debts. They can be sent out faster and more frequently to get your artists’ noticed. Our blog is a place for inspired musicians to read up on music & culture, and advice on production& mastering. In one common scenario, a label will have a band sign a contract stating that the label owns the copyrights to any master recordings the label … This is if the business has a profit. For example, you’re required to maintain corporate records and hold shareholders’ and directors’ meetings on a regular basis. But, these can be expensive and a hassle to maintain. You will need to weigh the added time against the risk to you personally if the business runs out of cash—or some other liability arises. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb. Their follow and feed system allows labels to generate their own profiles and interact with like minded online communities. i already registered a fictious name that i can use for either company,i need to know if for example:abc record and xyz music publishing llc.can be one entity? By David M. Steingold, Contributing Author. Was this document helpful? Keep being a fan. Most independent labels have their own Bandcamp pages that group all of their releases together. A business plan is one of the best ways to get legit immediately. The process is easy and can be completed online at the IRS website. Decide on the type of incorporation you want for your record label, such as the following: Each business type has its pros and cons. But choosing just one is the most important part in the beginning. 1) If you choose to form your record label as a Sole Proprietorship, then in essence, the business is “you.”  You alone own and run the company and it’s pretty easy to form. This approach is suited to small labels, typically run by one person or a small team. Learn more about choosing a business structure. The best approach for avoiding this type of trademark issue is to try to make a thorough search of existing record labels, recording companies, entertainment companies, and other businesses before settling on a name for your own label. Branson had mentioned in his autobiography that the name “Virgin” was suggested by his colleague who believed that the name perfectly suited the company as all the entrepreneurs were new to the business as ‘Virgins’. Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your record label is sued. Your record label can be structured either as Sole Proprietorship (similar to UK sole trader), a General Partnership, a Limited Liability Company (LLC), a Joint Venture (a General Partnership of limited duration), or as a ‘C’ or ‘S’ Corporation. Owned by the Universal Music Group, the record label primarily focuses on urban and hip-hop music. Just don’t be a suit. Sole proprietorships are simple and inexpensive to run. Copyright law surrounding sound recordings is complicated. are a hybrid between Sole Proprietorships and Corporations. You might be saying “Ugh, legal stuff. Just like you’d be creative with your sundae toppings. If you need help with incorporating a record label, you can post your legal need on UpCounsel's marketplace. Forming a Corporation is pretty easy. What are you listening to? ), you need to maintain your initial momentum. Plus it ensures that you won’t get burned later by that pesky thing called ‘The Law.’ Getting everything together to go legit with your record label can be enough to make your head spin. You’re an entrepreneur now. In a partnership, two or more people come together to run the business. var plc291816 = window.plc291816 || 0; So, using our earlier example, if as president of the Corporation, you sign a contract to pay the video director and don’t, then he can only sue the Corporation and not you or your shareholders personally. If you name your Seattle-based label Blue Shock Music and there is already a popular label in Atlanta named Bleu Shox Sounds, you may well find yourself looking at a trademark infringement suit. Although securing distribution is important in the long run, it is often not mandatory right off the bat. We mean the streaming site Bandcamp that allows for the purchase of digital albums and physical releases. Instead, the profits, losses, deductions, and tax credits of the business are passed through the business to the owner’s individual tax returns. Soundcloud is an excellent place to generate a good presence. n.parentNode.insertBefore(s, n); You'll also have fees to pay, but all of this is necessary to legally operate a business and protect yourself. LLCs have great flexibility on how to divide profits and losses among the owners. Once the state approves your application and receives all necessary fees, your record label is official. Small successes allow you to take some slight risks. This just means you get to look for—and hopefully find new and amazing music everyday. An LLC is like a partnership because owners jointly own and manage the business. One minor disadvantage is that with a Corporation, there are more administrative requirements. Once that is in place, go to various music venues to scout out talent, then approach bands or artists that you think have potential and sign them to your label. This will ensure that your content doesn’t get stale or played out. That is, it ordinarily pays no taxes itself. All your artists should be registered with licensing companies such as BMI, ASCAP or SESAC. Keep in mind that it will be everywhere. Review: ‘Teepee Gang’ by Tribe Mafia, a dynamic hip-hop record for the hustlers in quarantine, Charline de Cayeux: Mixing Seamless Sounds Live on Tour with Hyphen Hyphen. Get the best of our production tips and news, weekly in your inbox. What do you love the most? In general terms, a record company usually owns or obtains the copyright on a sound recording through a contract with the recorded performer. Reaching as many listeners as possible is key. In most states, creating an LLP requires registration with the state government, annual filings, and administrative fees. For now we can leave this to the big shots. opt: { looking at filings for corporations, limited liability companies, and similar entities registered with state and local government offices, such as your secretary of state’s office; state-level listings are usually available online. You’ll have to maintain more records than with a sole proprietorship, though. Music Publishing Companies are the hook up. You quickly reach out to your entertainment lawyer and ask him to help you set up a company for your new record label. Boooorrrrrring.” But it’s really not that hard to get bonafide. You can start out small if you want to create a record label. Each state has different requirements, although they tend to have many similarities. For sole proprietorships and partnerships, you'll usually register with the city or county. s.src = 'https://servedbyadbutler.com/app.js'; It will represent you forever—on and offline. We're not around right now. A major aspect of this is social media. You’ve already recorded a killer album and have approached your friends and family members about investing some monies so you can market and promote it. Depending on your state, the cost of incorporating a business may be as low as $100. The IRS taxes a multi-member LLC the same as a partnership. In some states, the information on this website may be considered a lawyer referral service. A label is a community. AdButler.ads = AdButler.ads || []; A helpful resource for business owners is the Small Business Administration. But we’re coming for you! No, we don’t mean sending your artists to an actual band camp to get better. For example: if you post something on SoundCloud you should let people know on Facebook and Twitter as well. Form 1065, U.S. Return of Partnership Income. The world’s second largest music publishing company after Sony/ATV Music Publishing, UMPG has produced some of the popular hits of all times including “Gangnam Style” by Psy, “Born to Be Wild” by Mars Bonfire, “That Don’t Impress Me Much” by Shania Twain, “Here Without You” by 3 Doors Down and “The Way You Look Tonight” by Kern/Fields.