The South Carolina Arts Commission and the South Carolina Small Business Development Centers (SBDC) held a virtual workshop to walk artists through choosing a legal business structure and the practical implications for taxes, liability, licensing and growth.

The session, led by Mackenzie Drake of the South Carolina Arts Commission and SBDC consultants Cliff Emery and Jim Johnson, emphasized that the choice of structure affects personal liability, tax obligations and access to funding. “The myth is that, you know, that people who are artists don't have a business sense,” said Cliff Emery, noting that many artists already practice entrepreneurial skills in their work. Jim Johnson, a senior business consultant and food-systems specialist with the SBDC, repeatedly cautioned attendees to consult professionals: “I am not a lawyer,” he said, and added, “I am not a CPA,” to reinforce that legal and tax advisers are appropriate for final decisions.

Why it matters: business form determines who is liable if something goes wrong, how earnings are taxed and whether an artist can scale or raise capital. The presenters said sole proprietorships are the simplest option but provide no separation between personal and business assets; partnerships carry joint liability; limited liability companies (LLCs) create a legal separation between owners and business assets; and corporations (S and C corps) bring additional administrative requirements but also tax and fundraising options.

Tax and payroll takeaways: presenters reviewed federal tax mechanics commonly relevant to solo artists. Self-employment tax (Social Security and Medicare) is about 15.3 percent on net self-employment income; that tax is paid in addition to income tax. Johnson used a simplified example to show that, after income and self-employment taxes, a sole proprietor might keep roughly $62 of $100 in profit in a 22 percent tax bracket, and explained how an S corporation structure can yield modest tax savings through payroll plus distributions once an owner pays themself a “fair salary.” The presenters offered a rule of thumb from tax advisors that the S‑corp election often becomes worthwhile when an owner’s net pay from the business is in the neighborhood of $30,000–$40,000, because administrative costs and filing requirements make the structure inefficient at smaller profit levels.

Licensing, registrations and IP: workshop speakers said artists should register any chosen entity with the South Carolina Secretary of State and obtain required local business licenses where they operate. Retail sellers must register for sales tax collection with the South Carolina Department of Revenue (the presenters referenced the state’s online portal for filing and payment). The presenters recommended obtaining an EIN (Employer Identification Number) from the IRS rather than using a Social Security number on business paperwork, and explained the differences between a legal entity name and a “doing business as” (DBA) trade name. The session also urged artists to consider trademark and copyright protection, and to consult an attorney before filing federal trademarks with the U.S. Patent and Trademark Office (USPTO).

Independent contractors vs. employees: the presenters reviewed tests commonly used to determine whether a worker should receive a Form 1099 (independent contractor) or be on payroll as a W‑2 employee. Key factors they listed include who controls schedule and methods of work, whether the worker supplies tools and whether the person has multiple clients or an ongoing relationship; presenters cautioned that misclassification can create tax and liability risk.

Practical supports: presenters said the SBDC offers free consulting across the state and encouraged attendees to sign up for local counseling. Johnson described the network as having offices statewide and consultants who can assist with business planning, marketing plans, feasibility analyses and referrals to attorneys or tax professionals. Mackenzie Drake of the Arts Commission said the agency will share slides and follow-up contact information and that the Arts Commission’s Arts Project Support grant is currently open and that staff can link artists with a designated liaison.

What presenters recommended: choose a structure that balances liability protection, tax efficiency and administrative cost; use written contracts; secure appropriate insurance; get zoning and licensing checked before occupying a space; consider an attorney for partnership or operating agreements; consult accredited tax preparers or CPAs for tax‑election timing; and document barter transactions (the presenters noted barters are taxable and should be recorded at fair market value).

The webinar closed with instructions for artists to request one‑on‑one SBDC counseling, and with the Arts Commission promising to send slides and a feedback form to registrants.

Ending: the session focused on immediate, practical decisions — entity registration, tax filings, contracts and basic IP considerations — and pointed artists to free, local SBDC counseling and Arts Commission staff for follow-up.