LLC for up and coming game dev

I was hoping for some insight into the topic of LLC’s and game development. I know that to get legal advice I should speak to a lawyer but just hoping for some general feedback and thoughts from other indie devs who may have some insight into this topic. I have participated in many game jams or been a part of games developed for platforms including web, mobile, and pc however I am now in the final stretch of development for my first indie title. I plan on continuing to make my own games throughout my life whether it be my full time occupation as an indie dev or as a side job while I work at a game studio. My first game will be free as will my next release which I have already started development on. I obviously hope for large profits from my games in the future, however for now profits from my games will likely be minimal. I know it is generally recommended to open an LLC for the sake of separating business and personal entities in a legal sense however paying for and maintaining an LLC is still an expense that I am not sure I should be making right now when I am most likely 2-3 years away from starting to make any sort of notable profits.

My main questions are: Is there a most appropriate time to open an LLC? Should I just continue to deploy the games I am developing for free on itch.io/mobile/steam the way I know how and only open the LLC when I plan on releasing a paid game with the potential for more commercial profit? Can I release games for free now and then have them transferred to the LLC for liability purposes?

I just think that when it comes to the reason of opening an LLC (liability) a free game is most likely not going to be a target or bother to any company and maybe it is more worthwhile to open once I actually plan on a significant commercial release.

I'll echo "legal advice --> speak to a lawyer" to get that out of the way.

If you're releasing free games, don't bother incorporating. You can file a doing-business-as name with your state or county if you really want to. It's cheap. But for now just release games and keep improving.

Once you start making significant money, talk to an accountant about your incorporation options. In the USA, LLCs are usually pass-through, so you'll end up paying a lot more in taxes than if you incorporate as an S-corp for example. The USA has a lot of Small Business Administration offices around the country that provide free business info and contacts to reliable providers.

Also, Thomas Brush has some good, practical videos on LLCs and related subjects:


And, again, legal advice -> speak to a lawyer; financial advice -> speak to an accountant.

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I will also add, who ever ask the lawyer about advice, please post the answer on a forum :).

The other circumstance where it might be worth incorporating is if you’re working with other people, to neatly handle intellectual property and such.

Incorporating may not be necessary, but it might be useful. Almost certainly necessary is having a clear, written, signed agreement outlining the terms of your work together, ie: a contract. And since that’s a legal document, I too will echo the “talk to a lawyer” thing, and they can tell you if incorporating would be useful or not in your case.

Unfortunately there’s not much benefit to that. Either it’ll be circumstantial advice which wouldn’t apply to others, or it’ll be generic stuff which you could already get from local business startup agencies / websites / etc.

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