How to Establish an LLC in the US as a Content Creator

The content creation industry has experienced extraordinary growth over the last five years, with advertising investment increasing from $8 billion in 2019 to $15 billion in 2024. Content creators have become community leaders, fostering loyalty and emotional connections with their followers. In fact, six out of ten subscribers follow their favorite influencers' recommendations over celebrities, and 50% of customers take action after reading or hearing a positive review.

If you want to succeed as a content creator and go viral on social media, it is crucial to transform your activity into a formal business. Our recommendation is to establish a legal structure, such as an LLC (Limited Liability Company) or a corporation, to take advantage of the various strategic and tax benefits they offer.

Below, we will analyze why opting for an LLC is the best way to protect your assets and take advantage of these benefits.

Why an LLC?

One way to protect yourself and your assets is by creating a Limited Liability Company (LLC). An LLC is a business structure that combines the limited liability protection of a corporation with the flexibility and tax benefits of a partnership. When you create an LLC, you form a separate legal entity for your business, which protects your personal assets from any liability or debt that may arise in the business. This means that, in case of a lawsuit or financial difficulties, your personal assets, such as your house or car, are generally protected and cannot be used to cover those obligations.

Opting for an LLC for your social media business is a smart decision because it provides legal protection while allowing you to maintain control and flexibility over your operations. Additionally, an LLC offers significant tax benefits, as business income is typically passed through to the owners and reported on their personal tax returns, thus avoiding the possibility of double taxation that could occur with a traditional corporation.

Advantages of Having a Business in the U.S. for Influencers or Content Creators

Asset Protection and Tax Benefits

One of the main reasons to consider an LLC in the U.S. is the asset protection it offers. As the owner of an LLC, your personal assets are separated from the company's assets, meaning your personal wealth is protected in the event of lawsuits or financial problems.

Additionally, LLCs offer flexibility in terms of taxes, allowing you to choose to be treated as a single tax entity or as a corporation, depending on which option minimizes your tax burden.

Tax Savings

One of the main benefits is that if you do not reside in the United States and do not have employees there, you will not be subject to U.S. federal taxes on your LLC's earnings.

By invoicing from your LLC instead of as an independent worker or freelancer in Mexico, Argentina, Colombia, or Chile, you can reduce your contributions to social security, health, and pension payments. Additionally, in Latin America, LLCs are considered foreign entities, which can offer significant tax advantages compared to local structures.

Moreover, you only need to maintain simplified accounting for your LLC's income and expenses, avoiding the typical complexities of a corporation. Forming your LLC in U.S. states like New Mexico, which do not require annual state renewal and minimize operating costs, can be particularly beneficial.

Greater Brand Recognition

Having an LLC established in the United States gives you greater control over the commercial use of your creative content and brands. For example, if another company uses your music or video without permission, your LLC can take formal legal action.

As an individual, it is more complicated to demonstrate direct financial damage from copyright infringement. However, a U.S. LLC that owns the assets can claim economic losses.

Additionally, a U.S. LLC can register trademarks and intellectual property at the federal level, thereby strengthening your legal rights as a creator nationwide.

You can also use your LLC to officially license your content and ideas in exchange for royalties, allowing you to monetize your creative work effectively.

Faster Payment Processing

A significant advantage of establishing an LLC in the United States is the ability to open bank accounts in the company's name, which is crucial for receiving payments from platforms like YouTube, Instagram, TikTok, and other major channels.

Many of these platforms only allow income transfers to verified business accounts, not personal accounts. By having an LLC, you ensure efficient access to your funds.

Furthermore, business accounts facilitate the direct payment of operational expenses such as equipment, software, travel, and more. This enables you to effectively track your business income and expenses.

In contrast, receiving payments into your personal account can complicate your business's financial management. With an LLC, you can manage and utilize your earnings as a content creator in a professional and organized manner.

Frequently Asked Questions

1. How can I create a business in the U.S. as an influencer? Creating a business in the U.S. as an influencer involves choosing a legal structure, such as an LLC, and registering it in the appropriate state. You need to prepare the formation documents, obtain an EIN, and comply with local and tax requirements. It is advisable to seek legal and accounting advice to ensure you follow all the steps correctly.
2. What are the most beneficial states for influencers in the U.S.? States like Delaware and Florida are known for their favorable corporate laws and tax-friendly regulations for businesses. These states are popular among influencers due to their tax advantages and business-friendly environment.
3. How much money can I save by taxing in the U.S. instead of my home country? The exact amount of tax savings depends on several factors, including your income and business structure. However, savings can often be significant due to lower tax rates and available deductions in the U.S.

Establishing a business in the U.S., such as an LLC, offers foreign influencers a range of competitive and strategic advantages. From asset protection to flexible tax options and access to a global market, a U.S. LLC can be the first step toward expanding your business and maximizing your potential as an international content creator. With the right guidance and professional support, you can build a solid foundation for your business success in the U.S.

At Prodezk, we offer personalized service at every stage of the process, ensuring a hassle-free experience and successful registration of your business in the U.S.