New freelancers always ask me for business tips and billing information. It’s complicated to answer for three main reasons. First of all, sole proprietorship DBA, LLC, B-corp, C-corp, and S-corp are confusing AF because each business structure has different taxation and benefits. Second, every production company has different policies and preferences. Third, billing processes change with every new tax code, form, and App released. There are simply too many variables.
Currently, there are plenty of business classes and advice articles for freelancers available on-line. However, there’s limited information for freelance wardrobe stylists working as independent contractors. Stylists are probably too busy, too protective, or simply too frustrated by paperwork to share business tips. In efforts to fill this information void, I’m happily sharing some of the good, the bad, and the ugly lessons I’ve learned.
Pulling from 16 years of commercial and advertising production experience, I compiled my top 6 business tips for freelance wardrobe stylist trying to navigate their way to a paycheck and tax compliance.
* I’m not a tax professional and don’t offer legal, accounting, or tax advice.
1. Find a Reputable Accountant
Hire an accountant that is familiar with the production industry and understands what a wardrobe stylist does exactly. Ask your crewmates and production peers for accountant recommendations. Before you make the final decision, ask your potential candidates about their client satisfaction and check their history on the Better Business Bureau.
Accountants are tax professionals and can properly advise you on what business entity to establish for taxation e.g., Sole Proprietorship, LLC, or S-Corp. Here are several links to small business resources:
- Business Structures: options and taxation explained at Small Business Administration Business Structure Information
- Small Business + Self Employed Tax Center
- Accounts (CPA) vs. bookkeepers: What’s the difference between a bookkeeper and an accountant?
2. Separate Business and Personal Expenses
After choosing your business structure and registering your business, open a business checking account for business transactions only. If you don’t have good credit or any credit history, start building credit and maximize buying power. American Express Business is my preferred credit card. I also have a Visa and a MasterCard in case a vendor doesn’t accept Am Ex.
★ Learn your credit card policies, penalties, interest rates, and billing cycles. Policies vary on every credit account.
3. Use Accounting Software
I’ve used QuickBooks for Mac for years. QuickBooks (QB) invoicing UI is simple, invoice layouts are editable, and invoices look professional. Online banking improvements have streamlined my bookkeeping. It takes about 45 minutes to download transactions and reconcile an account. Also, I can save and share reports and PC backups with my accountant.
★ Double entry accounting is tricky. If you don’t have accounting experience, enroll in a small business accounting workshop. SCORE offers free small business accounting workshops. If bookkeeping is still too intimidating, hire a bookkeeper.
4. Get Your Poop in a Group
Set up a digital and/or paper filing system and expense reporting method and stick to it! Consistency will help streamline record keeping and keep paperwork organized. DO NOT try to reinvent your systems every tax season.
★ For the love of all things gold foiled and crystal pleated, do not take record keeping advice from a pretty Pinterest post. I adore Pinterest, but use the IRS Recordkeeping publication for current guidelines.
★ Need help setting up a paperwork management system? Check out the National Association of Productivity and Organization (NAPO) website and find an organization expert in your area. The advanced search menu can filter by NAPO specialty e.g, paper management, office organization, bookkeeping / billing, chronic disorganization, ADD/ADHD support, hoarding tendencies.
5. Ask Production about Billing Preferences
Every production company has different billing practices and preferences. If you don’t know their billing preferences, ASK. Billing topics to consider:
- Expenses: petty cash, P-card, or out-of-pocket reimbursement to pay for wardrobe + production expenses?
- Invoice or Time card: how are fees paid? Productions may require time card through a Payroll service for insurance reasons. Other productions ask independent contractors to invoice the production or department key. Invoice fees and out-of-pocket expenses separately:
- Fees Invoice: discuss day rate before work starts. Fees include prep days, shoot days, and wrap days.
- Expenses Invoice: out-of-pocket expenses are “Due Upon Receipt” to insure reimbursement within a 30 day billing cycle.
- Receipts: are original receipts or digital scans required with billing? How are receipts presented? taped down to a page or loose grouped by transaction? taped one-sided pages or two-sided? cut or folded? straight cut or angled cut? GAH! Receipt presentation is extremely specific and tedious. I have a preferred way to handle receipts that works for both paper and digital filing, but MY way is not THE ONLY way.
- Expense Report: using production company’s expense reporting form or a PC envelope? If not, find an expense report template to help reconcile receipts. I designed my expense report spreadsheet and I wish everybody used it.
- Auxiliary Expenses:
- Kit rental: rental fee for essential department equipment; charged per day only on shoot days.
- Mileage: track production related mileage during prep, shoot and wrap days. Business mileage rates and rules change yearly in IRS publications available at IRS.gov.
- Assistants + Outside Services: invoices paid by the production company or department key?
- Trucking + Transpo: cube truck or cargo van rental and fuel expenses for wardrobe transportation. Most commercial productions don’t have wardrobe trailers and transpo departments like film + episodic productions. Trucking handled by either the department key or production.
- Travel: are travel expenses paid or expected to work as a local? Confirm rate on travel days, mileage, per diem, and hotel costs.
☞ Billing for Freelance Wardrobe Stylists follow-up blog post is coming soon!
6. Use the Cloud for Calendar and Contacts
I use iCloud to share Calendar and Contact data across all of my devices. I enter confirmed bookings, meetings, conference calls, credit card billing, and tax dates. Record your holds and second holds. Forgetting a hold is real bad. Also, I can easily share production calendars with assistants for tracking days and hours.
Most of all, use your contact management system like you never have before. Record professional contacts, product and service vendors, and collectors of the rare and unusual items. Categorize your contacts and enter detailed notes about where or how you met. You never know when you will need a wool felting expert or a 10 gallon hat collection. Trust me, it happens.
All the business tips and professional advice in the world is useless if nobody wants to work with you.
Let me know if there are other styling topics you would like me to cover. Maybe a post about organizing my war room? Love to hear your suggestions.