If you’re talented and skilled with a guitar, you might think of teaching others how to play this fantastic instrument for fair compensation for your time and knowledge. Many people make their livelihood by teaching others to play an instrument, so why shouldn’t you?
In the end, the cost of guitar lessons can range from $30 up to $100 or even more per hour. This isn’t really an issue if you’re having one student per day, but having several students daily can quickly increase your income, and all income you earn is taxable. Once you start taking on more students and making more money, taxes become a part of the equation.
This is why starting a guitar teaching business is a good idea; it’s much easier to handle taxation, your business expenses are deductible, and if you open an LLC, you get additional taxation benefits on top of liability protections the LLC structure has to offer. Not to mention the staggering number of tax tools free tax tools that make things significantly easier.
In this guide, we’ll go over how to start a guitar teaching business, why you should structure your business as an LLC, and what some of the requirements and benefits of doing so are.
How to Start a Guitar Teaching Business
In order to transition your guitar teaching from a side hustle into a successful business, you need to come up with a business plan. Fortunately, this isn’t such an abstract thing to do as you might think; in fact, there’s a structured methodology that lays the foundations for formulating a business plan.
A Business Plan
You don’t really have to write a full-blown business plan with expenses and profit projections, marketing expenditures, but it pays to know some of these things going in. What you’ll need initially is a business name, location, and mission statement, followed by your target market and business goals.
As for a business name, you can easily use your own name or something unique and catchy that you’ll put down when filing a Public Records Filing for a New Business Entity. You need to search for the name of the business in your state’s registry because two businesses in the same state can’t have the same name.
You can use your home as your business location, at least until your student body becomes too big to accommodate. There are some implications regarding personal addresses being used for businesses, such as local zoning laws and homeowners’ associations, as well as some privacy concerns—the latter of which is easily solvable through alternative address options.
Once you grow your business, you can try to find a different location, in which case you also need to consider things such as target market proximity, accessibility, competition, location type, and so on. Lastly, you need to figure out your target audience, whether it’s school students, business professionals, young children, or the retired.
This is really important, primarily because it helps you refine and focus your marketing efforts. Social media is every marketer’s dream; you can use Instagram to market to younger audiences, email or even Facebook to market to adult and business professionals, and radio or newspapers to advertise to the elderly.
File for a Business Entity
We previously mentioned opening a limited liability company (LLC) for your business due to the many benefits such a structure has to offer, which we’ll discuss in the later section of this guide. One of their biggest benefits is that they’re relatively easy to set up, relatively inexpensive, and take five to seven days when done via mail or one business day when filed online.
You need to search for an adequate, valid, and available name for your LLC, followed by a registered agent for your LLC, which is a person or a business entity designed to receive legal documents and other notices on behalf of your LLC. You can act as your own registered agent or a registered agent service. The latter is a great option if you’re looking for more privacy.
Next, you want to file a Public Records Filing for a New Business Entity. This filing comes with a filing fee, which is state-specific. For example, Colorado charges a $50 filing fee plus a $10 recurring fee, while Massachusetts charges a $500 fee plus a $500 recurring annual fee. New Jersey LLC requirements, at least when it comes to fees, are $125 one-time plus a $75 recurring annual fee.
While both filing and recurring fees are state-specific, there are also some other, more tangential fees associated with the formation of the LLC. These include the operating agreement, which describes the operation of your LLC, and getting an EIN from the IRS.
It’s important to note that you don’t need legal representation to file articles of organization to form an LLC. However, hiring LLC filing services can reduce the risk of incorrectly filed paperwork, which can lead to additional work and fees necessary to fix the application or completely reapply. To learn more about forming an LLC, visit LLC University.
Marketing and Promoting Your Business
Once you’ve started your guitar teaching business, you might want to consider advertising to attract more students. There are many different ways you can advertise and promote your guitar lessons, and some methods work better than others.
Social media is a great way to promote your business, and you can do it for free, at least initially. However, if you want more enhanced exposure, paying for social media ads allows you to tweak your “reach;” you can set your target demographics, target location and area, etc. Depending on different options, social media advertisements offer scalable pricing tiers, so you can choose a pricing range that fits your finances the best.
Social media advertising also provides you with the opportunity to connect with potential students and answer any inquiries they might have about the lessons you offer, which isn’t really available with other advertising methods. It’s important to note that with the rise of social media, other advertising methods, such as radio and newspapers, aren’t economically viable anymore.
Use High-Quality Guitar Teaching Materials
After you’ve got your guitar teaching business up and running, you need to provide high-quality lessons to your students, and using the right teaching materials can make a massive difference. Of course, students are expected to bring their own guitars, but you might have to provide them with a few accessories, at least during the lesson.
This could potentially include a guitar finger training tool, finger caps, picks, a silencer mute pad, perhaps a de-rusting brush pen, or a capo. All of these can be obtained at Guitarmetrics, your one-stop online shop for all things guitar-related.
Structure Your Pricing
This is a rather important step because it includes several different factors you have to consider. As previously mentioned, guitar lessons go from $30 to $100, or even higher, depending on multiple factors.
In-person lessons tend to be pricier compared to online lessons, and if you’re located in an expensive neighborhood or you live in a larger city, the price of lessons is likely to tip more towards the pricier end of the scale. This can offer a slight discount on group lessons, which would allow you to save time for pricier one-on-one lessons.
Online lessons are typically more affordable, and you can easily bundle them into package deals. Whatever route you choose, it’s important to remember that not all work environments work for everyone, and some students might need individualized plans.
Why Start an LLC Guitar Teaching Business
One of the greatest benefits of forming an LLC is liability protection, which protects your personal assets, such as your home, car, and personal bank account, in case your guitar teaching business incurs debt or faces legal issues.
As your business grows and you take on more students and possibly expand, the risk or potential legal issues also grow. An LLC disassociates your private assets from those of your business, shielding the private ones from any risks associated with legal issues.
There are also tax benefits since a single-member LLC is taxed as sole-proprietorship, meaning that you report your business income on your personal tax return. However, you might reconsider this once your business grows past a certain point.
Business growth is also much more manageable in terms of complexity, especially if you plan on growing your business further, hiring other music teachers and instructors, and perhaps even expanding to multiple locations.
Additionally, the LLC structure can provide more credibility and professionalism to your expanding business, especially since most parents and adult students feel more comfortable working with an established legal entity rather than an individual.
Summary
Opening your guitar teaching business and forming an LLC isn’t as complicated as it used to be, especially since the barrier to entry for startups and entrepreneurs is now lower than it ever was. All it takes to open an LLC is a good idea and some due diligence. However, if you’re looking for counsel or support with opening an LLC, don’t hesitate to contact LLC University.
