► Loan-Out Companies for Entertainers 

Loan-out Company Formation and Maintenance

We represent Entertainment Clients
with Loan-Out Companies, Corporations
Loan-Out S Corps and LLCs for Entertainment Ventures

Nearly every celebrity, musician, artist, band, group, or other entertainment professional that you know has what is called a “loan out company,” by which their personal services are provided to the public at large.

A loan-out corporation is essentially a company that is formed for the purposes of employing the entertainer, whether it is an actor, actress, musician, artist, band, group, singer, or other entertainment professional.

If you need to establish a loan-out company, a loan-out corporations, a loan-out S Corporation, or LLC for entertainment, business, or tax reasons, contact us today. Axis Legal Counsel represents entertainment clients in a multitude of legal matters.

 

► Types of Entertainers and Influencers we Represent 

Axis Legal Counsel can assist your entertainment career in full-service legal representations that span multiple practice areas for comprehensive legal coverage:

Entertainment Law Business Tax Law Formations & Dissolutions Contracts & Transactions Influencers and Entertainers Actors and Actresses Musicians

Athletes and Sports Figures Singers and Songwriters Social Media Influencers Dancers and Theatric Stars Fashion Models Creatives and Creators

► Entertainment Practice Areas

We represent clients involved with the Film & Television industry with a variety of legal matters. Whether it involves contract negotiations, entity formation, compliance with California laws and regulations,  licensing, copyright/trademark matters, consulting, strategic advice, or production issues,  Axis offers entertainers connected to the film & television industry high-quality legal representation spanning multiple legal fields.

Contracts and Transactions Axis Legal Counsel serves the entertainment industry, including entertainment talent, creative professionals, and influencers across multiple medium, including film, television, music, new media, mobile apps, radio, online, and numerous others:
	Contracts and transactions Endorsement deals Licensing Intellectual property Influencer agreements Social media promotions Production agreements Actor/actress agreements Screenwriters	TV & Film Agreements Speaking Engagements Writing contracts Publishing Cast agreements Talent agreements	Option/purchase agreements Life rights agreements Rewriting agreements Creative consultant agreements

 

Financing and Investments Axis assists entertainment producers, and production companies with investment and financing issues arising out of the production process:
	Loanouts and Entertainment Businesses Production LLCs Entertainment investment agreements Entertainment production Financing	Investor pools Entertainment Investments Residual/participation agreements Back-end compensation agreements Production investment agreements	Producer participation agreements Participation agreements Sales financing Distribution financing

 

Intellectual Property & Licensing Axis assists entertainment clients with a wide variety of intellectual property and licensing matters, ranging across copyright, trademark, trade secret, licensing, confidentiality, and related matters:
	Confidentiality Agreements Copyrights Copyright Assignments Copyright Infringement Content-Licensing Agreements	Intellectual Property Assignment Licensing Contracts Non-Disclosure Agreements Licensing Contracts Video Synchronizations Film Clip Licensing	Trademarks Trademark Disputes Trademark Infringement Trademark Registrations

 

Disputes, Lawsuits, and Litigation Axis represents clients in entertainment matters in a wide range of disputes, lawsuits, and litigation, ranging multiple practice areas:
	Participation/residual accounting Accounting disputes Intellectual property disputes Contract disputes Infringement	Breaches of contract Film investment fraud TV/Film financial mismanagement Non-disclosure agreement breaches	Unfair competition Invasions of privacy Non-payment of debts or money for services rendered

 

Unions and Guilds Axis advises clients on a variety of union and guild issues, including compliance, contract negotiations, disputes, and regulatory matters:
	American Federation of Television and Radio Artists  (IATSE)(AFTRA) Directors Guild of America (DGA) International Alliance of Theatrical Stage Employees	Motion Picture Directors Association Screen Actors Guild (SAG) Writers Guild of America (WGA) Producers Guild of America (PGA) Alliance of Motion Picture and Television Producers (AMPTP)	International Cinematographers Guild Motion Picture Editors Guild (MPEG) Animation Guild Motion Picture Sound Editors (MPSE)

► Why Loan Out?   

There are a few reasons why entertainers form loan-out companies, most of which have to do with taxes, income-planning, and intellectual property. For example:

• Reducing Tax Rate. Generally, having a loan out company will help entertainers who do not have consistent income (very high one year, maybe low the next year) spread out their tax obligations for high-income years. Being able to spread that income out over several years will result in an overall lower tax rate.

• Lower Taxes Overall. Because corporations are taxed lower than individuals, entertainers would generally pay less in taxes operating through a corporation than as a n individual, i.e., a sole proprietor.

• Pensions and 401(K)s. One of the greatest benefits of an entertainment loan-out company is the ability to funnel the entertainer’s income, tax-free, into certain plans that have very favorable tax treatment, such as pensions, 401(K) plans, or other similar profit sharing plans and trusts. With these types of tax-deferred accounts, the entertainer does not need to pay taxes on income until retirement and would even have an opportunity to obtain distributions of income, tax-free, in the case of a disability later in life. Even better, the money saved up in these tax-deferred accounts could be excluded from death taxes upon the death of the entertainer, leaving more for the entertainer’s family and heirs.

• Protecting Intellectual Property. In the event that bad financial or other circumstances fall upon the entertainer, the entertainer’s valuable intellectual property assets are preserved as property of the company.

► How Loan Out Companies Work

In a typical loan-out entity, a musician would form a loan-out company, and when advances or royalties were paid by the musician’s record label, they would be paid to the company, not the musician. The company would then pay salary to the musician, as an employee, and pay payroll taxes and the employer’s share of FICA (Medicare/social security) for the musician. At the end of the year, the company would issue a W-2 tax return to the musician and the musician would file taxes as an employee.  The loan-out company would pay the expenses incurred by the musician, such as agency or manager commissions, and legal or accounting fees, and could deduct business expenses such as office space, and equipment.

► Types of Loan-Outs 

Loan-out companies are like any other business entity. They can consist of C-Corporations, S-Corporations, and LLCs. Many entertainers prefer S-Corporations or LLCs rather than traditional C-Corporations because of the easier administration and management of those types of corporate entities.

► What are the Disadvantages to Loan-Outs?

The disadvantages of having loan-out companies are primarily related to the extra expense that will be required to set up and maintain the business entity, as well as accounting and legal services to reduce the risk of audit by the IRS.  Because loan out companies can result in significant tax savings, they can be investigated more closely by the IRS. Corporations and LLCs  can generally cost approximately $1,500 – $3,500 to start up, with various governmental and other maintenance fees payable over the course of the entity’s life. In California, for example, a franchise fee of $800 per year must be paid to the California secretary of state, which is waived for the first year for corporations, but due immediately for LLCs.

► What kind of Maintenance is Required for a Loan-out?

To ensure that the loan out company stays in existence, and in accordance with the legal requirements, entertainers will need to make sure that the corporate formalities are met, such as holding annual meetings, maintaining minutes of meetings, filing the necessary secretary of state annual filings, and paying taxes to state and federal taxing authorities. Further, if the loan out company employs any assistants, staff, or other employees, it will need to comply with state and federal labor laws.

AXIS Legal Counsel represents entertainers in all types of entertainment matters, including forming loan out companies and structuring entertainment business entities and transactions to accomplish a variety of business planning needs for entertainers. For information or for a confidential consultation, contact us at (213) 403-0130.

►How to Request a Flat Fee Quote?

The best way to request a flat fee quote for your project is to email us with what you need and, if it involves reviewing an agreement, a copy of your agreement. We will usually respond within 24 hours and provide you with the flat fee quote. Or, you can use the attached link to our form to Request a Consultation. 

There is no charge for budgeting. If you would like to go forward with our firm after receiving the quote, then we would love to work with you.

 

► Who Will Work on My Project?

Meet our managing attorney, Rabeh Soofi. Rabeh is the founder of the firm and personally oversees all legal projects for clients. You will never be passed around from lawyer to lawyer, and your project will never be delegated to brand-new lawyers with no experience. We have a “clients first” approach, so we work very closely with clients to develop a good working relationship based on trust and mutual respect. Clients are never routed through receptionists or secretaries to have calls screened –  you will have direct access to your attorney, without any intermediaries, all the time, whenever you need help.

 

 

► Tell Me More About Your Firm …  I Really Need a Good Law Firm Behind Me.

We feel the same way! Axis places a huge focus on helping film clients get fairness and fair deals, and we genuinely approach each client engagement as an opportunity to help the growth of emerging or established entertainer. We develop strong relationships with their clients, often over the course of many years, and maintain a very collaborative working relationship with clients, decision-makers, and others, that is based on trust, mutual respect, and a team-based approach to helping the entertainment or creative professional growth.

Axis is also a huge supporter of the Los Angeles entertainment community. Axis is a member of the California Lawyers for the Arts, and routinely holds seminars, presentations, and other events for members of the LA entertainment community.

 

►   What are Past Clients Saying About You?

Don’t take our word for it – hear what clients have to say! We are rated 10.0 by Avvo.com, ranked as “Superb” in the practice of law. What to know what past clients have to say about Axis? Check out our Client Reviews!

 

►   This Seems Way Too Easy… What’s the Catch?

There is no catch! Axis counsels and represents film clients every day, all week long, every month, throughout the year. We routinely represent film clients from all genres. We love helping emerging and established film and motion picture professionals.

 

Read our Entertainment FAQs Our FAQs answer the most common issues in the Entertainment industry. We have an extensive FAQ Library that covers the most common questions we get from entertainment businesses, as well as FAQs on recent changes in law affecting entertainment businesses. How to Work With Brands (And Protect Yourself) Tiktok Influencers: Could you Lower your Taxes by Turning Your Tiktok Account into a Business? Tiktok Influencer Agreements: What Legal Issues Should be Covered in a Tiktok Influencer Agreement? Thinking of Hiring an Influencer to Help Promote Your Business or its Products and Services? Here’s What Your Influencer Agreement Should Look Like: Thinking of Hiring a Freelancer? Tips to Protect Your Business When Using Freelancers A Major National Retailer Has Stolen Your Work, and You’ve Become a Victim of Copyright Infringement: What Do You Do Now? Top 10 Must-Know Tips for Negotiating Your Publishing Agreement for Authors and Writers  Top Legal Issues and Deal-Making Tips for Negotiating an Artist-Management Agreement for Musicians, Singers, Songwriters, Music Bands, Groups, and Recording Artists Overview of Copyrighting a New Work of Authorship Film Production Law: A Legal Guide for Filmmakers and Film Producers for Short Films, Feature Films and Film Projects Top Tax Tips and Traps for Los Angeles Entertainment and Creative Professionals Top Entertainment Lawyers Los Angeles – Where to Look and How to Find One Screenwriters’ Dealmaking Tips for Negotiating a Screenplay for a Film and Television Option/Purchase Agreement Basics of Loan-Out Companies for Entertainers in Music, Film, TV, and Arts   Commerce Clause and the Resale Art Market: California Artists May Soon Lose Right to Resale Royalties Do I Need an Entertainment Lawyer? How Entertainment Lawyers Work and When to Hire One Starting a Band – What are the Legal Issues? ►Visit our Entire FAQ Library

Our Recent Projects  We counsel entertainment clients every day in nearly every practice area. We have represented a variety of entertainment clients in numerous industries across multiple disciplines and practice matters. Here are some of the highlights. AXIS Hired to Represent Film Producer in Film Production Dispute Axis Represents Film Producer in Production Dispute Axis Represents Entertainment Startup Axis Hired by Hollywood Actor Published Author Seeks Axis’s Legal Advice Regarding Film Option Rights

► AS SEEN IN

Our talented legal counsel has been quoted in a number of press outlets, including the following:

►Our Awards and Accolades

Our talented legal counsel has  consistently been recognized for excellence in legal services, and has been rated or ranked by Avvo, SuperLawyers, Euromoney’s Definitive Guide to Leading Litigation Lawyers & Law Firms, Los Angeles Magazine, and others.

• Superlawyers – Rising Stars (2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020) – Top 2.5% of Attorneys in the State
• “Superb” Rated by Avvo.com (2011, 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020)
• “Top Attorneys – Los Angeles Magazine (2013, 2014, 2015, 2016, 2017, 2018, 2019, 2020)
• Recognized as one of the Global 100 Lawyers in Business Law (2017)
• “Business Law Firm of the Year” – ACQ/Intertrust Magazine (2016)
• “Top Business Law Firm” – Finance Monthly Magazine (2016)
• “Superb” Rated by Avvo.com (2011, 2012, 2013, 2014, 2015, 2016, 2017)
• Lawyers of Distinction (2016)
• “Up and Coming Attorneys” (2010)
• Euromoney’s Definitive Guide to Leading Lawyers and Firms (2009)

 

 

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*** Testimonials are not a guarantee of any success or outcome, nor any guarantees about your legal matter. Each case is unique.

► Serving Clients Nationwide and in 22+ Countries Internationally

We represent clients throughout the U.S. and in 22+ countries internationally.

 

KEYWORDS

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