For many authors, the writing and publishing journey begins as a bucket list item, creative pursuit, or a calling, not as a business or career. What they don’t realize is the moment they publish their work and make it a product for sale in the marketplace, they are starting a small business. If an author’s goal is to earn a profit from book sales and to continue selling long-term, there are additional steps that should be considered to present themselves professionally, protect assets, and build a sustainable business. With this new venture comes an important question: As a small business, should they register a DBA (Doing Business As), form an LLC (Limited Liability Company), or even set up a corporation?
DBA stands for “Doing Business As” and refers to the name someone assigns to a business. It’s also called a fictitious business name, assumed name, or trade name depending on the state. Registering a DBA requires minimal paperwork and only a small investment, making it a great option for authors using a pen name or brand name, or, for those wanting to create an imprint name to self-publish.
When you start selling books, freelance writing, editing, speaking, or coaching, you are automatically considered a sole proprietor. No additional action is required if you want to do business under your legal name, assuming you are the sole owner.
If you do wish to create and register a name, brand, or imprint for your business that is different from your legal name, you must file a registration form (Certificate of Assumed Business Name) with your state or county and pay a fee, typically ranging from $10 to $100. Some states require publishing a notice of your new business name in a local newspaper, and some require a renewal every 1 to 5 years. If you file a DBA for your author business, you are still structured as a sole proprietor, but now with an assigned business name.
Here are some general guidelines around creating a DBA name:
• Must be unique and distinguishable from existing registered businesses• Must avoid entity identifiers like "LLC" or "Inc." if not actually incorporated• Cannot falsely imply a connection to government agencies or use restricted banking terms• Cannot imply a different purpose than the actual business• Must comply with state-specific regulations, which can vary by location
The downsides of having a sole proprietorship with or without an assigned DBA name, and not having a more formal business structure like an LLC (Limited Liability Company) include:
• No liability protection: your personal assets are at risk if sued• You have less credibility when entering into contracts or applying for financing• There is no structural flexibility as your income grows• Owners pay personal income tax on net earnings and a 15.3% self-employment tax if net earnings are $400 or more
Registering a DBA can be a great option for authors just starting out or for those planning to publish only one book.
An LLC (Limited Liability Company) is a formal business structure that protects the owner’s personal assets from business debts and lawsuits while offering flexible tax options. Unlike corporations, LLCs avoid double taxation, and unlike sole proprietorships and DBAs, they provide liability protection. An LLC is legally separate from the individual, meaning personal assets like your home, car, or savings account are protected if your business is sued or incurs debt. For authors, an LLC can provide crucial personal liability protection and business credibility, making it ideal for more established, high-risk, or high-earning authors. Additional benefits include the ability to bring on partners and enhanced protection for intellectual property ownership.
An LLC provides superior tax flexibility compared to a sole proprietorship. While both use pass-through taxation where profits are reported on personal tax returns, LLCs can elect S-corporation status to significantly reduce self-employment taxes (15.3% tax) on profits, where sole proprietors pay on all net earnings. An LLC taxed as an S-corporation allows the owner to pay themselves a "reasonable salary" that is subject to the 15.3% tax, and take remaining profits as a distribution, which is not subject to self-employment tax. This can potentially save them thousands. In the US, most tax professionals suggest considering an S-Corporation election once your net profit (after expenses) exceeds $50,000–$75,000 per year. LLCs also allow deducting formation costs—up to $5,000 in the first year of business. You can learn more about author tax deductions here.
To set up an LLC, you must register your business with your state's secretary of state. Every state has different criteria for setting up an LLC, so research the guidelines that apply to your area. Compared to a DBA, registering an LLC is more time-consuming and requires a larger investment. Typical steps include:
Many authors will use a combined approach and form an LLC for legal protection, then file a DBA to manage multiple pen names under that single entity.
Not every author needs to take the step of setting their business up as an LLC; however, there are specific situations where forming one makes sense:
You Are Earning Significant Income: If your author income has become consistent or substantial, your financial risk increases. Higher income means higher visibility and potentially greater legal exposure.
You Have Legal Risk Exposure: Authors can face legal claims such as copyright infringement, defamation, privacy violations, contract disputes, and more. An LLC adds another layer of protection between you and your business liabilities.
You Are Signing Contracts: If you’re entering into publishing contracts, speaking agreements, licensing deals, or film or adaptation rights, an LLC allows the company to be the contracting party.
You Want to Build a Publishing Brand: If you plan to publish a large portfolio of work, launch an imprint to publish other authors, or sell courses or coaching services, an LLC provides a more scalable foundation.
You Plan to Collaborate or Add Partners: A DBA cannot create ownership shares but an LLC can. If you’re co-writing books, starting a small press, or building a joint venture, an LLC is typically the better structure.
You Want Tax Flexibility: Once profits grow beyond a certain level, electing S-corporation taxation under an LLC may reduce self-employment taxes. A DBA does not offer this option.
You Want to Apply for Financing: By establishing a formal business entity through an LLC, you can increase your credibility with lenders and open doors to business-specific loans.
You Want Clear Separation of Intellectual Property: An LLC can own your copyrights, trademarks, and publishing assets. This can simplify licensing, estate planning, or even selling your work in the future.
For the vast majority of authors, a sole proprietorship with a registered DBA or a formed LLC are enough to address their needs and concerns. A typical author business path can look like this:
• Begin writing and selling books > Sole Proprietor• Choose a pen name or business name > File a DBA• Income and risk continue to grow > Form an LLC• The business expands significantly > Consider S-Corporation tax election
Corporations are legal entities that are owned by shareholders, not by members like an LLC. They are a more formal structure designed for growth, investors, and stock issuance. There are only a few circumstances when authors might consider forming a corporation:
• They plan to seek investors• They are building a large media or production company• They are making a very significant income, so a different tax strategy makes sense• They plan to eventually sell the business
Whether you operate as a sole proprietor, register a DBA, or form an LLC for your author business depends on several factors including your income level, risk tolerance, long-term vision, and state regulations. Before making any decisions, we recommend consulting a qualified CPA or business attorney familiar with author businesses.
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