DBA worth it for a Self Pubber?

[BWFoster78]

I read a tip once that a self publisher should be as professional as possible (a position with which I agree). The suggester went on to advise the self pubber go as far as creating a publishing company so that it's not as obvious that you're self publishing.

I thought this was a fantastic idea. I envisioned myself as CEO, CFO, COO, and chairman of the board of Brian W. Foster Enterprises. Cool deal.

Then I looked into what is required to set up such a thing.

My understanding is that, if I want to say that I'm operating as "Insert Name Here Publishing Company" in the state of CA, I have to file a "Doing Business As" Fictitious Business Name form in the county of my residence. For Riverside County, that means:

$58 filing fee
Publish my fictitious business name statement in a local newspaper for four consecutive weeks (not sure how much that's going to cost, but it will certainly be more than nothing)

Now, $100 or so isn't going to break me, but I have to watch my spending. I'm already going to be, probably, out close to $1500 before I ever see a dime.

Is there anybody out there that thinks doing this DBA would be worth the cost?

Here's my thinking:

1. While having a business name would be cool, I don't see it generating a lot of sales. Who really looks at that information in their decision making process?
2. Self Publishing is fast losing its stigma, so being associated with indie publishing doesn't have the downside that it perhaps did when the tip I read was published.
3. It may actually be to my advantage to play up indie roots.

Thoughts?

 

[Telcontar]

Not worth it. Readers don't care who publishes their books as long as the book is good. Your distributors (Amazon and Smashwords and all the rest) will treat you no differently.

Pretty much, it's a vanity thing.

I have a pipe dream of starting up a business through which I publish my books, but that would be only one of the entertainment-related things I'd do through that brand name, so it would serve more purpose. Only when that looks feasible would I bother.

 

[Devor]

The thing with branding, it's a lot like storytelling. One inconsistency can break immersion.

So the answer is yes, the DBA name is worth it, if that's the consistent brand image of your book.

However, you also need to be honest with yourself about whether that's the true image of your book or not. It's not true just because you say it is or because you want it to be. Do your cover art, book blurb, sample pages and so on scream this is a professional, well-written, well-edited book, and lots of high-quality work went into every aspect of this product? If that's not an image you're genuinely able to achieve, then the DBA probably is not worth it.

If that's not your image, that doesn't mean your book will automatically fail. In my experience, work quality tends to fall into tiers, where you can easily move up or down in a tier but have a lot of trouble breaking into a higher one. But the tiers are slanted, so that many of those in Tier 2 are doing better than many of those in Tier 1. Getting an accurate impression of which tier you're in is important for understanding how to position your work for success. ((Please note, this is only a perspective used to frame a situation, and is not meant to be a mystical judgmental absolute. I don't typically go around categorizing people into tiers....))

It's kind of like officers and enlisted in the military. Everyone expects the young Lieutenant to do well, and they often flop against the expectations. But a Master Sergeant can gain a lot of respect and importance under the radar before anyone even takes note. That's mostly a metaphor, and I'm sorry to our members of the military if that's not an accurate portrayal. But the point is, if you understand the strength of your overall work and your brand, it's easier to decide what is or isn't worth it, and to pursue the right avenues of success.

 

[Steerpike]

There are tax and other consequences of being a solo proprietor versus setting up a formal entity like an LLC.

 

[Devor]

There are tax and other consequences of being a solo proprietor versus setting up a formal entity like an LLC.

I typed more of a response and deleted it because my memory of these issues is a little too hazy. But he just wants to publish under a name besides his own and isn't attempting to establish a separate legal entity.

 

[Steerpike]

I typed more of a response and deleted it because my memory of these issues is a little too hazy. But he just wants to publish under a name besides his own and isn't attempting to establish a separate legal entity.

Ah. Yeah in that case he'd still be a sole proprietor. Instead of a DBA, I think I'd just go with an LLC or something. Those are usually cheap to set up.

 

[Devor]

Ah. Yeah in that case he'd still be a sole proprietor. Instead of a DBA, I think I'd just go with an LLC or something. Those are usually cheap to set up.

I wanted to say that my law professor would have suggested an S Corp to avoid both the liability and the extra taxes. But I don't remember enough about the LLC, and I've no idea what the costs are in California.

 

[Steerpike]

I "think" an LLC can also be set up under subchapter S, so you have the advantages of both. But I'm neither an accountant nor a corporations attorney, so I would have to do some research to see the advantages and disadvantages of each.

 

[BWFoster78]

Wow, this is getting complicated...

 

[Zero Angel]

I set up Apocalypse Designs as a fictitious name. I didn't have to publish in a newspaper, just file a form and pay $50. For me, I'd eventually like to publish others and release games and apps, so it wasn't a difficult decision. On the other hand, even if you just add "Publishing" to your name for your company, then I think you have to register that...

And even if it is a company name, most people group small press and indie together, so I don't think you have to worry about appearing too professional.

 

[BWFoster78]

Okay, after doing a little bit of research, I'm just not sure what creating a business does for me in my situation.

Since I don't think I'll be seeing profits this calendar year and, as an author of fiction books, I'm not all that worried about liability, I don't see any advantage to the S corp or LLC. I am missing something? Can I decide to do that later if I want?

Regarding the DBA, I get what Devor is saying about brand, but I just don't see many people ever even noticing the publisher and even fewer of those caring if one isn't listed.

 

[Steerpike]

If you're not making a lot of money, the tax consequences may not be sufficient to warrant formation. You could check with a CPA, I suppose, but I'd be surprised if you get a lot out of it.

As for liability, as you said there's probably not a whole lot there. About all I can think of would be some kind of defamation or right of publicity claim if you incorporated real-world people into your book, or intellectual property claims if you had some kind of infringement. Neither seems particularly likely, to be honest.

 

[Kevin O. McLaughlin]

I think there is a definite edge to using a business name. It is generally VERY inexpensive to set one up.

What model you choose depends on what you want to do. Sole proprietorship works fine for most writer/publishers. You can ask an accountant or local SBDC office for info about other forms of company.

It gives you a brand you can begin establishing for future use. Suppose, say, Amazon kills KDP tomorrow? Small presses will still do just fine. The writers who have formed small presses, or have taken the steps needed to jump into "small press mode" quickly won't be slowed at all.

Some readers still avoid self published work. Your small press business name looks just like every other small press business name, and doesn't stand out as being self published - which lets those potential readers judge you by the quality of your work, rather than preconceived notions.

It's one little extra bit of professional appearance.

It allows you to open a bank account in your business name - useful for book keeping and tax purposes. Don't just dump writing income into your personal checking account unless you want serious tax headaches.

Other reasons too, but those are some of the big ones.

 

[MichaelSullivan]

People here are mixing several different things.

1. Whether you use a "name" as the publisher rather than your author's name
2. What "tax determination" you make.
3. Whether you setup a LLC.

If your company is say "Sunset Publications" - you can make it a LLC or not - it's your choice and actually making it a LLC doesn't really protect you in any meanigful way.

Also, you need to pay taxes on money you get. If you don't do anythig...Sunset is by definition an "sole-proprietorship" and the income is reported on Schedule C of your individual return.

You can become a "corporation" (Usually S - there is no reason to be come a "C" corporation) in which case Sunset has it's own return and the income from that return is also included on you income tax return. (If you became a "C" corporation - again not recommended - the it would have it's own tax return and it would pay corporate tax and only income you took out of it would show up on your tax return.

 

[Kevin O. McLaughlin]

Most states in the US require you to file paperwork (somewhere - most often with the Secretary of State's office) even to start a sole proprietorship. Some states will waive the requirement if you're not using a fictitious name (Role of the Hero Publishing - my company - is a fictitious name; McLaughlin Publishing would not be).

So if you want to put "Sunset Publications" on your books, and on sites listing your books, DO check with your state regulations. Odds are good you have to file some sort of paper and pay a small fee.

LLC and S Corp are different animals. Generally, those are useful for people who want to limit their personal liability for company expenses, for example in the case of the company going bankrupt, you don't want to lose your home. Having an LLC or S corp can help prevent you losing your own assets if the company goes bust. (Even then, it doesn't always work - most creditors will require you personally sign for debt during the first five years or so that you're in business, because they know most small businesses fail.)

For a business like self publishing? Heh. You're not accruing debt, in most cases. The odds of bankruptcy making any sense are slim. Your worst case is someone sues you for libel or trademark infringement, in which case you as author AND publisher are going to be sued, and the LLC/S corp isn't going to save you. So in most cases, until you are pulling in enough money for the S corp to be useful for tax purposes (check with your accountant - I think we're talking six figures, though), it's probably not worth the indie writer's time to go down those paths.

A DBA/sole proprietorship makes a lot of sense for a variety of reasons though; outlined some of those reasons above.

 

[Zero Angel]

Most states in the US require you to file paperwork (somewhere - most often with the Secretary of State's office) even to start a sole proprietorship. Some states will waive the requirement if you're not using a fictitious name (Role of the Hero Publishing - my company - is a fictitious name; McLaughlin Publishing would not be).

I'd be wary about this. SBA (Small Business Administration) has this to say:

For example, consider this scenario: John Smith sets up a painting business. Rather than operate under his own name, John instead chooses to name his business: “John Smith Painting”. This name is considered an assumed name and John will need to register it with the appropriate local government agency.

Another source I read said that a fictitious name is one that does not have your last name or one that suggests multiple owners. e.g. John's Painting or Smith & Family Painting. According to this source, John Smith Painting would be OK.

Check your local laws—every state is allowed to have different regulations and penalties.

 

[BWFoster78]

I think I've decided to forego the fictitious business name for my first book and just leave the publisher blank. In my county, it's going to be at least $100 to set up the name, and I just don't think it will make enough sales to get that $100 back.

I simply can't imagine many people even looking at who the publisher is, much less deciding not to make a purchase because of it.

Unless anyone has experience to the contrary?

 

[Zero Angel]

I think I've decided to forego the fictitious business name for my first book and just leave the publisher blank. In my county, it's going to be at least $100 to set up the name, and I just don't think it will make enough sales to get that $100 back.

I simply can't imagine many people even looking at who the publisher is, much less deciding not to make a purchase because of it.

Unless anyone has experience to the contrary?

Well, you'll EVENTUALLY make that money back (especially as you release more and more), but that money can be better used elsewhere in my opinion. It was only $50 for me, and I had already made that much money in pre-order pledges for my novel.

Aside: Are you talking about your novel or your short story though? I thought you were going traditional for your novel?

 

[BWFoster78]

Aside: Are you talking about your novel or your short story though? I thought you were going traditional for your novel?

My short story, I'm just going to give away on my website. No Amazon or anything.

For the novel, I entered it into Amazon's contest, but I don't hold out a lot of hope of winning. If I do win a publishing deal, I'll obviously go traditional. Otherwise, I'm self pubbing.

 

[BWFoster78]

For reasons totally personal (I've always wanted to own a business), I've decided to start an LLC.

A couple of quick questions:

Which sounds better:

A. "Insert Company Name" Press
B. "Insert Company Name" Publishing

I'm leaning toward A.

If anyone has knowledge of establishing LLCs, my understanding is that I can establish anywhere that I can come up with an address for. Since CA charges $800/yr for the priviledge, I'm going with my parent's address in LA. Though I don't live there, can I still be my own registered agent or should I choose one of my parents?

Thanks!

Brian