LLC or NGO for video production

I

Indigo

Pros and Cons?

I need the "official enitity" in order to operate iand do logistics n production world.
Equipment rentals, car rentals, insurences, hiring talents etc..all that is close to imposible to do as an simple individual no matter what line of credit I have on my AE black :)

I have several projects lined up, meaning I am here to stay, and I am hoping to get funding from other people/institutions for all those docs/music videos/feature that I am about to produce/direct!

Idealy, this "official entity" would be a place where I also am going to be officialy employed for the medical insurance, tax and similar purposes.... not like selfemplyed anymore!

I do understand that down the line, for the liability reasons, Hollywood creates a special LLC for each and every movie they make, but I am affrad that I am still far away from the Hollywood point of standing...


Think "Jerry Bruckerheimer films"...something like that is what I am after...to be able to develop, copyright, initiate various projects in video/production field.


But is there any advantages (or disadvantages of operating this "production baby steps" as a NGO, Non for profit etc rather than LLC?


(Sast cost North America is my location)
 
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LLC is the way to go. It's super cheap to obtain, easy for tax reasons, and helps ensure that you can't get sued and lose your personal belongings.

It really won't affect your medical insurance as far as I know but I could be wrong!

Also, it's still common practice to create an LLC for each low budget film.

Sorry I don't know more. My company is an LLC and it's been a breeze.
 
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These types of things should always be discussed with an attorney, and perhaps with an accountant. Right now I have just my Alcove Audio Productions business, but there was a time when AAP had several other LLCs under the umbrella - there was myself as a performer, as a studio musician, the recording studio itself and a small duplication business. This is the same concept as a separate LLC for each film; it provides legal isolation and was a great legal way to lower my taxes.

You've already mentioned:
Equipment rentals, car rentals, insurance, hiring talent
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and each of these should be isolated from each other.

It's really easy to pick a name and say you are in business, but you actually have to draw up the proper legal paperwork to be able to legally protect yourself.
 
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I would consult an attorney or at least check with SBA for a free consult. There could be other free resources in your area too. LLCs requirements vary from state to state. Non profits have different federal and state requirements.
 
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Well I already did that, I went to consult with a "general" lawyer that offers free consultations for startup biz at local colege, and she said that LLC is the way to go after I presented her with my goals, plans and ideas!

But she is not familiar with film/video production at all. All she said is based on general knowledge about small bizz.

And than my filmmaker friend from NY told me that she started a non-profit, non-goverment agency in NYC because it will enable her to shoot a couple documentarties with many perks (taxbreaks and receiving financing from foreign corporations etc...) that NGO offers over corporation...but she couldn't quite explain me how and why that will work for me too :)

At some point I will go to entertainement lawyer once I have a budget for him, but before that, I do want to do m homework first!


I ask here, hoping that you understand better, obstacles and benefints that a fellow filmmaker encounters and looks for, better than a freshly-licenced-recent-law-school-graduate or a still-at-school-wanna-be doc filmmaker :)

Even when I asked one of the producers that I work with on commercial productions (advertizing, TV pilots, corporate videos...) "why he has .Inc instead of LLC?", the best answer he had to offer was:
"My accountant told to d o so!"
:)

I mean, he a great person by all acounts with 2 decades of experience in commercial production world, but he never produced a indie feature or a doc movie. He just doesn't know the problems and needs of a indie filmmaker... :)
 
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Indigo said:
Well I already did that, I went to consult with a "general" lawyer that offers free consultations for startup biz at local colege, and she said that LLC is the way to go after I presented her with my goals, plans and ideas!

But she is not familiar with film/video production at all. All she said is based on general knowledge about small bizz.
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There is no difference between a small business that makes
bicycles or serves food and a small business that makes movies.
Both are run in exactly the same way.

Indigo said:
And than my filmmaker friend from NY told me that she started a non-profit, non-goverment agency in NYC because it will enable her to shoot a couple documentarties with many perks (taxbreaks and receiving financing from foreign corporations etc...) that NGO offers over corporation...but she couldn't quite explain me how and why that will work for me too :)
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Then talk to her again. You need her help - what are friends for?

If you will be making documentaries then a non-profit might be
the way to go. But then you are limited to making ONLY projects
that fall into the legal definition of "non profit".

An "indie" prodCo that does not make a profit is not, legally, a
not for profit business. If your goal is to produce movies for sale
then your company is not a "non profit" even if you fail at your
goal and do not make a profit. In general a non profit is a charity.
Not always, but that's a good foundation on which to base your
understanding. Just don't think that if you're pretty sure your company
will make a movie or two that does not earn a profit that makes you
a "non profit" company.
 
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