Disclaimer: This blog post is for informational purposes only. We, at Authors On A Dime, are not lawyers or accountants and are not giving legal or financial advice. Consult with a tax professional and lawyer before making decisions regarding your business.
Indie authors, have you considered starting your own self-publishing company?
What does that mean?
No, we do not mean that you are starting a business like a small press where you publish other authors (yet). In this case, we mean starting a company under which you would publish your own self-published novels.
Why would I do that?
This is a route many self-published authors are taking for several reasons. Let’s explore a few:
1. Professional Appearance
When you start an independent publishing company, you can then register your ISBN with your company name as the publisher. This will show up on your book sales page and looks more professional than “Createspace” or “your name” as the publisher.
2. Control & Autonomy
You are still self-publishing, and therefore, you still have the control and autonomy that comes with that. You are making the decisions about covers, editing, pricing, etc. You are just doing it as a company rather than as an individual.
This is the biggest reason to consider this route. Self-publishing under your company’s name separates your personal income and assets from your book publishing activities.
This can be helpful for tax purposes (and possibly even give you some tax breaks). In addition, when you form a LLC or S-corp, it shields your personal income and assets from lawsuits that may occur. Lawsuits are very rare in our type of business, but some people prefer to have this extra layer of protection in place.
Also, there are possibly some benefits in terms of easier legal transfer of ownership and royalties if you were to die. We have heard of complications involving self-published authors royalties not being able to go to their spouses or next-of-kin for long periods of time, as it’s personally paid to that author only. Setting up royalties through your self-publishing company may help with that. PLEASE NOTE: In our simple research of the legalities online, the is NOT clear. This area seems very muddy, from a legal standpoint. So ASK A LAWYER. We are including it here as just one more aspect to consider.
4. A Publisher KDP Account
The terms of service state that you can only have one KDP account. However, a benefit of owning your own publishing company is that your company has its own EIN and bank account, which allows it to open its own KDP account. So now you can have two KDP accounts, and the second one is a publishing account, which comes with added benefits, such as the ability to have more author pages, as well as use more pen names.
5. Options for Later
If, at a later date, you did wish to start publishing other authors, moving your business to that of a small press, already having your business set up will be a big step toward realizing that dream.
How do I get started?
As we mentioned before, we aren’t lawyers or accountants. Plus, the process to set up a business differs from state to state.
If you decide this is the right path for you, we recommend you do your research and, even better, hire a competent lawyer and/or accountant to help you set everything up.
Things you will need to consider:
- The type of business to set up (LLC, sole proprietorship, C-corp, etc.)
- The legalities of setting up the business (including location)
- The name of your publishing business
- Set up of a separate bank account
- Set up of an accounting system (for ease with taxes, even if it’s just you you’re publishing)
- Registration of a domain name & creation of a website (even just one page listing your own books)
- Creation of your publisher accounts with KDP and other outlets through whom you’ll be publishing
What else should I consider?
In making your decision, please also consider the Cons. Setting up a business can be time consuming, mind-numbing with paperwork, and a royal pain. Don’t forget, you’ll also have to pay taxes separately on the business. It can also be expensive depending on which state you live in, as well as the need to hire professionals (those lawyers and accountants again) to help you do it right.
You may have already self-published a book, or many books, under your name. Research how difficult it will be to move those titles under your publisher name. Research the steps and legalities associated with that move.
In addition, if, down the road you decide to publish other authors under your company, there are more hoops to jump through including, but not limited to: arranging commissions, writing contracts, hiring editors, hiring cover designers, hiring a marketing team, paying your employees, additional tax-related things associated with having employees, and so forth. And again, those lawyers and accountants and the expenses involved to help you do all that right.
We hope we’ve given you some food for thought. Again, we are not lawyers or accountants to be giving you legal, financial, or business advice. The information on this page is what we have found doing limited research online ourselves. We encourage you to do your own thorough research and consult with the professionals to make the right decision for you and to take the appropriate steps based on that decision. Best of luck!