Top Legal Mistakes Creative Entrepreneurs Make

Top Legal Mistakes Creative Entrepreneurs Make

We know that owning a business can be hard, especially when you are new to the world of business & entrepreneurship. Thankfully, we’ve been there and now we’re sharing advice on how to avoid some of the most common mistakes creative entrepreneurs make.

Not Using Lawyer-Composed Contracts

When you run a business in the service industry, contracts aren’t just a good idea – they’re essential. Not only do they protect you, but a thoughtfully composed contract makes expectations, services, and deliverables clear from the get go. This means your client knows exactly what they’re signing up for and can communicate any questions, concerns, or priorities before officially enlisting your services. Sounds ideal, right? Happy clients are good for business.

But hiring an attorney to create a custom set of contracts for your business can be extremely cost-prohibitive for a small business owner, especially when you’re just starting out. It feels like a catch 22, but there is a solution – contract templates. Whether you need an NDA, a release form, terms and conditions, a GDPR-compliant privacy policies, an independent contractor agreement, a full service contract, or an individual clause, a quick Google search will instantly populate a plethora of template options to purchase and download. 

When choosing a legal template to purchase for your business, make sure it is written in easy to understand language and presented in an organized fashion. Remember, these contracts aren’t just fail safes for your business – your client needs to be able to understand the terms so they can enter into the agreement with confidence. Additionally, make sure it is comprehensive for your industry. For example, a contract to enlist the services of a wedding photographer should include detailed policies that cover location limitations, cancellations, rescheduling, weather, harassment, safety, force majeure and other emergencies. 

You also need to consider your source. It is never acceptable for a layman to provide legal counsel. You wouldn’t go to the owner of a clothing boutique and ask him to give you a medical treatment plan for your high blood pressure…even if his mother is a pediatrician. That seems obvious, right? Likewise, you shouldn’t purchase contracts from anyone other than a licensed attorney; bonus points if their expertise is on creative, small businesses (let’s chat!). Why? Laws and regulations are ever-changing and require a full time professional to stay up to date on them, and contracts require specific language and meticulous composition. Not only will the document leave you and your business at risk, but creating and selling a legal template as a layman is a massive liability for their own business. My advice is to steer clear. 

Instead of using an unqualified source for your legal contracts, purchase one from a currently practicing lawyer who understands the needs of creative business owners. Because it was so hard to find comprehensive, affordable, legitimate contract templates, I decided to fill the gap and create some myself, which are available at But whether you use mine or someone else’s make sure you review any customizations, additions, or alterations with an attorney practicing in your state for local compliance, and revisit them yearly to make sure they stay up to date with current legal best practices, as well as your most up to date policies.

Not Making It Official

You have your website ready to go, a shiny new logo, a branded Gmail account, and you’re ready to get started. But before you do, don’t forget to make it official. There are a few different ways to create a legal business entity – a sole proprietorship, a limited liability company (LLC), or a corporation, to name a few. For most creative, small business owners – especially those in service industries – forming an LLC typically makes the most sense. Essentially, an LLC keeps your personal assets protected (for example, if your business gets sued, they can’t come after your home to satisfy the lawsuit when you have an LLC but they can in a sole proprietorship), and you don’t have to maintain as many complicated, and often expensive, formalities of a corporation (i.e. annual report and shareholder requirements). 

Creating an LLC is super easy, and is one of the first steps you should take when forming your business. Search for “register a business” on your state’s website, and you should be directed to an online application. They might require rules, bylaws, or operating agreements and you will have to pay a filing fee, but the process is straightforward and can easily be completed in an afternoon. If you need any help with the filing process, feel free to reach out and we will guide you through the steps in a 1-1 consultation. 

Spending Too Much On Your Education

Now don’t get me wrong; I am a firm believer that we should always be challenging ourselves to learn more, whether that be through going back to school, identifying a mentor, listening to industry-specific podcasts, reading books, attending workshops, participating in incubators, or enrolling in online courses from industry professionals. These can all be invaluable tools in growing yourself and your business. However, I want you to keep these two very important tips in mind: 

First, do not use continuing education as a distraction from making what matters happen. It’s easy to fall into the trap of feeling productive and having all of your time, money, and energy consumed by these learning ventures leaving you with nothing left to actually invest in your business, your clients, your creativity, your work. (I’ve seen people do this subconsciously out of fear of actually starting more times than I can count!) So find that balance of learning as you go, prioritizing the education that will add the most immediate value to your business and enhance the parts that only you can do. Instead of spending time and money on a class to learn how to do the bookkeeping and accounting yourself, outsource it! But definitely take that AutoCAD course to enhance your technical expertise for your interior design business. 

Second, choose reputable sources. In this digital age, it’s easier than ever for someone to label themselves as an expert and market a course. Do the research before clicking that sign up button to make sure you’re taking a course from someone who has actual, proven experience in their field and positive reviews from former students to testify to their teaching abilities. Your time, energy, and money are valuable, so ensure that each course or educational opportunity you pursue brings you a return on your investment.

Forgetting About Taxes

I know – taxes are confusing and scary, but pretending they don’t exist won’t make them actually disappear (although I wish it worked that way). So let’s make them as simple and straightforward as possible. Set aside about ⅓ of your profits (your net income minus your business expenses) in a separate bank account for federal and state taxes. If you have a solid projection of your annual or monthly income, you can set up regular, automatic transfers from your business checking account to your business savings account for this purpose. You need to pay your taxes four times a year – typically on the 15th of April, June, September, and January – and it’s important to be on time with payments, as you will likely get charged a fee if you’re late or miss a quarter. Because taxes can be so complex, and their are tons of deduction opportunities for small business owners, I highly recommend working with a CPA who specializes in small businesses and can guide you through your business finances and taxes.

Being Underinsured

There are three types of insurance your business needs (especially if you’re a service provider) – liability, professional liability, and equipment. Here’s a quick breakdown of what these mean: General liability insurance covers bodily injury and property damage (i.e. a client sues you because they slipped on the step of your studio and broke their ankle during your consultation session), professional liability insurance covers against financial loss (i.e. a client sues you because they’re unhappy with the services you rendered), and equipment insurance protects the gear essential to doing your job (i.e. you’re a wedding photographer, and your camera lens gets scratched by a rogue branch in the way of a golf cart incident during an event). 

Many venues require photographers to carry a certain threshold insurance policy to work at their property, however, even if you haven’t come across this yet, it’s a good idea to start your business off on the right foot by carrying business insurance. Try reaching out to the company that provides your personal homeowner’s, renter’s, or auto insurance as a first quote or reach out to a trusted insurance agent who can help point you in the direction of a company that specializes in policies for small business owners. There are also a few insurance companies that specialize in insurance for photographers! You can surely find a company where all three types of insurance are wrapped up into one.

Trying To Do It All

I’ll keep singing this from the rooftops: Outsourcing is one of the best investments you can make in your business. Not only does it free up your time and energy – because let’s face it, what will take you 1 hour to figure out and will probably give you a headache will take a professional bookkeeper 10 minutes – so you can focus on what you do best, it’ll actually protect you in the long run because it will be done correctly the first time. No mess cleaning up down the road. I recommend every business owner budget to work with a CPA, a lawyer, and a trustworthy insurance agent from day one to make sure your business is legit and safe. Look for people who specialize in small businesses and offer flexibility in packages or an hourly rate rather than a retainer fee (Oh, hello there! I’m available on an hourly basis to help with your creative business legal needs.). And as you scale your business and your team, outsourcing payroll, human resources, and benefits is a smart move.

Keeping It Risky

Shooting on private property, not obtaining permits, and shooting in risky locations (railroads, assumption of risk, etc.)

Mixing Business & Pleasure

This one is pretty straight forward – and it’s actually really easy to do! Keep your business accounts separate from your personal, even if you don’t have a single employee. Why? Mixing your expenses is not only a bookkeeping nightmare (was that gas line on the debit card in April for my personal use or for traveling to the Smiths’ wedding?), but it also puts you at risk for losing the liability protections of your LLC. And I’m talking ALL your accounts – checking, savings, credit cards, Paypal, Square, etc. All you need is an EIN (employer identification number), which you’ll receive when you create your official legal entity with your state. You’ll want to make sure you’re keeping track of all business income as well as any business-related expenses for tax purposes. One of my favorite things I use is Bench Accounting, which takes care of categorizing and tracking all of my income and expenses, and then delivering that information to my accountant at the end of the year! Bottom line, always keep your business and personal accounts and funds separate, and keep track of it all for tax purposes.


Feeling stressed about all the different aspects of running your business? Our free resources are here to help! Check out our blog for more!


Hi there! Welcome to my free resources page, where I share all kinds of freebies, templates and guides for creative business owners, artists, and entrepreneurs.

If we haven't met yet, hi! I'm Magi. I'm lawyer, educator, photographer, storyteller, traveler, and entrepreneur. My journey has taken her from photographing professional surfers while swimming in some of the world's most epic waves to receiving a Juris Doctorate from Rutgers Law.

If I'm not photographing a wedding with my husband, Scott, in a remote locale, managing our team of Associate Photographers, or providing legal counsel to creative business owners, then you can probably find me eating an açai bowl, chasing my pup, Arti, around the beach, or watching SVU reruns in our bungalow.

I hope you find these intentionally-crafted resources useful, and if there's anything else I can do for you and your business, please reach out!

Shop Templates


This information is made available for educational and general informational purposes only; it is not legal advice for an individual case nor does it guarantee any future result. This material may be improved upon or updated without notice, and The Artists’ Lawyer will not be held responsible for any outcomes as a result of this education. Do not act upon this information without seeking individual advice from a lawyer licensed in your state. You understand that viewing this information does not establish an attorney-client relationship between you and The Artists’ Lawyer, or the founding attorney, Magi Fisher.

Use coupon code WELCOME10 for 10% off your first order.


No more products available for purchase