Starting side business as wedding musican

From a federal tax perspective, the IRS generally views a single-member LLC and a sole proprietorship as the same thing: **disregarded entities**. In both cases, you will report your income and expenses on **Schedule C** of your personal Form 1040. You will pay ordinary income tax and self-employment tax (Social Security and Medicare) on your net profits. There is no federal "tax savings" created simply by choosing an LLC over a sole proprietorship. The primary difference is **legal liability**, not taxation. An LLC provides a layer of protection for your personal assets against business lawsuits, whereas a sole proprietorship does not. **Key Tax Considerations:** 1. **Deductions:** You can deduct gear, travel, and sheet music regardless of the structure. 2. **EIN:** While a sole proprietor can use a SSN, an LLC often requires an EIN, which is safer for providing W-9s to clients. 3. **State Fees:** Some states charge annual franchise taxes or filing fees for LLCs that do not apply to sole proprietors. If your primary concern is taxes, the "Sole Proprietorship" is the simplest starting point. If you are concerned about legal protection, consult an attorney regarding the LLC.