Can you sell art without an LLC?
Asked by: Santos Hodkiewicz | Last update: January 31, 2026Score: 5/5 (1 votes)
Yes, you can absolutely sell art without an LLC by operating as a sole proprietorship, which is the simplest way to start, treating your art sales as personal income reported on Schedule C of your taxes; however, an LLC offers liability protection, separating personal and business assets, which becomes more important as your business grows and takes on more financial risk, according to Artwork Archive, doola.
Do you need an LLC as an artist?
As an artist, you don't need an LLC when starting out, but it becomes highly beneficial as your business grows by separating personal and business assets for liability protection (like from lawsuits) and offering potential tax advantages (especially if electing S-corp status), though it adds costs and paperwork; most beginners start as a sole proprietor and consider an LLC when taking on larger commissions, running workshops, or facing significant financial/legal exposure.
Can I legally sell my handmade products without an LLC?
Yes, you can legally sell handmade products without an LLC, typically operating as a sole proprietorship, which is the simplest setup, but you'll need to handle business licenses, tax permits (like sales tax permits), and potentially register a business name (DBA) depending on your location and branding. While an LLC offers liability protection (separating personal and business assets), it's not legally required to start selling, though it's recommended as your business grows or involves higher risks.
Can you sell things without an LLC?
You do not need to have an LLC to do business... You can do it as a sole proprietor. Many people start this way. However, you will still need to get a business license with your city and register with the state to collect and pay sales tax. (Every state has slightly different rules and processes).
Do I need an LLC for a hobby?
Forming an LLC is not necessary, it won't change your tax liability. An LLC protects your personal assets if you are sued. Crafters who sell items like candles, soaps, toys, etc should form an LLC. Otherwise, liability insurance is enough, which is probably already required to sell at craft shows and fairs.
How to Sell Art (WITHOUT social media)
What is the 3 year hobby rule?
The "3-year hobby rule," or the IRS hobby loss rule, is a presumption that an activity is a business (not a hobby) if it makes a profit in at least three of the last five consecutive years, allowing you to deduct losses; if it fails this test, the IRS may classify it as a hobby, limiting deductions to only certain expenses like mortgage interest or property taxes on the home used for the activity, and requiring you to report all income.
At what point do I need an LLC?
An LLC offers limited liability protection, meaning personal assets are not at risk for business debts. It's ideal to form an LLC when your business income increases, you have multiple partners, or you want to separate personal and business finances.
Can you write off stuff without an LLC?
Can I write off business expenses if I don't have an LLC or an S-Corp? Yes, even when filing as an individual, you can still write off business expenses. All businesses can deduct ordinary and necessary expenses from their revenue. The IRS will tax you as a sole proprietor if you are the only owner.
Can I sell things without being a business?
Whether you're selling through a marketplace like Etsy or operating an independent website, you're required to abide by your local laws. This often means getting a business license. Depending on what you're selling, you might also need to obtain additional licensing.
Can you sell on Etsy without an LLC?
No, you do not need an LLC to sell on Etsy, as most sellers start as default sole proprietors using their SSN for taxes. An LLC becomes beneficial as your business grows by offering personal liability protection, separating personal and business assets, and is a good idea for more serious income, but it's not a legal requirement to open the shop itself.
Is it legal to sell art without a license?
Yes, you can sell your own original art without a specific "art license," but you often need a general business license, must collect sales tax, and must avoid infringing on others' copyrights, which requires a license for branded or recognizable elements. The main legal requirements involve standard business operations (local/state permits, taxes) rather than a unique art-specific one, but using trademarked characters (like Disney) or famous logos without permission is illegal.
Is it illegal to sell homemade crafts?
If you're selling your crafts to the public — either at craft fairs or on websites like Etsy, Facebook or Amazon Handmade — you'll need to officially register your crafting business. It's easy to get caught up in the fun of creating something and finding out people want to pay you for your craft.
Do I need insurance to sell handmade crafts?
Public liability insurance is not a legal requirement, however, some craft fair organisers will want to see evidence of the craft sellers' insurance. This is because during the craft fair, you will be interacting heavily with the public.
How do I legally sell my art?
If you are selling any artwork yourself, it is a legal requirement to have a business license. It allows you to file for a DBA (Doing Business As) so that you can operate under the business name of your choice. You can also operate a business under your own name.
What is the 80 20 rule for artists?
The 80/20 rule (Pareto Principle) in art means that 80% of significant results come from 20% of effort, applicable to both creative process and business, suggesting artists should identify the most impactful 20%—like core skills (perspective, anatomy) or crucial marketing efforts—to focus on, while recognizing that 80% of a painting's success might hinge on 20% of focused detail work, often the final touches that bring it to life.
Do artists have to file taxes?
If you are self-employed, you may receive Form 1099-MISC, Miscellaneous Income, showing amounts you were paid. If you are self-employed and your net earnings are $400 or more, you must file a tax return and pay self-employment tax on the income you report on Schedule C.
Can I sell items without an LLC?
No, an LLC is not required to sell online. Many ecommerce sellers operate as sole proprietors without forming a business entity. However, an LLC can offer liability protection, tax benefits, and increased credibility. Whether you need one depends on your business size, risk level, and long-term goals.
What is the 50 30 10 rule for selling?
The "50/30/10 rule" in selling is a pricing guideline for garage or yard sales, suggesting you price new items at 50% of retail, slightly used at 30%, and used items at 10%, aiming to move inventory quickly by making prices attractive, with variations like the "50/30/20 rule" being common in personal finance, not sales, though the pricing idea shares a percentage structure.
How much does Etsy take from a $100 sale?
From a $100 sale on Etsy (including $100 item + $0 shipping), Etsy takes roughly $9.95 to $10.00 in standard fees (listing, 6.5% transaction, payment processing), but this can jump to $20-$25 or more with Offsite Ads (12-15% mandatory for top sellers) or currency conversion, making total fees around 20-25% of the total sale price.
Is it illegal to run a business without an LLC?
An LLC isn't required to start a small business. If you're mowing lawns for money or selling carrots at your local farmer's market, you're already in business as a sole proprietor. If you bring on a business partner, you're doing business as a general partnership.
What are the biggest tax mistakes people make?
The biggest tax mistakes people make include simple errors like wrong Social Security numbers, names, or math; failing to file on time or at all; missing out on eligible deductions and credits (like education or retirement); not keeping good records (W-2s, receipts); incorrect filing status; and poor record-keeping for business expenses, leading to potential audits or processing delays. Using IRS.gov resources and tax software helps avoid these common pitfalls.
What is the $2500 expense rule?
The $2,500 expense rule refers to the IRS's De Minimis Safe Harbor Election, allowing businesses (without a formal financial statement) to immediately deduct the full cost of tangible property costing up to $2,500 per item or invoice, rather than depreciating it over years. This simplifies taxes for small businesses, letting them expense items like computers or small furniture in one year if they follow consistent accounting practices and make the annual election by attaching a statement to their tax return.
How much money can you make before you need an LLC?
There is no exact income threshold for forming an LLC. However, experts recommend registering side businesses as LLCs when they've earned substantial income.
What is the downside to an LLC?
Disadvantages of an LLC include self-employment taxes on all profits (unless taxed as a corporation), higher costs and paperwork than sole proprietorships, difficulty attracting outside investors (like VCs), limited life (can dissolve with member changes), potential for personal liability if formalities aren't followed, complex ownership transfers, and state-specific rules that can add fees (like franchise taxes in California).
What happens if you start an LLC and do nothing?
If you start an LLC and do nothing, it can remain inactive, but you'll likely face state requirements like annual fees and reports, potentially leading to suspension or penalties, and still need to handle federal taxes (like reporting expenses on Schedule C for single-member LLCs) or file corporate returns (if elected as C or S corp), even with no income, while risking loss of liability protection and business credit if you ignore compliance, says LegalZoom, BetterLegal, Law 4 Small Business, Imani Law, and Northwest Registered Agent.