The marketing chapter built something that earns. This one is about everything around the money, and it starts with the least glamorous and most foundational piece: the legal shape of your business. How you structure it decides how much of your personal life is exposed if the business is sued, how much of your legal identity shows up on contracts and payouts, and how you are taxed. None of this is legal advice, the rules differ by where you live, and a professional who actually understands adult work is worth what they cost, but knowing the map is what lets you have that conversation instead of nodding along to it.
If you are earning money from your content and have not registered anything, you are already a sole proprietor, which is the default the moment you start. It is free, takes no paperwork, and is genuinely fine while you are small and still testing whether this is a business at all. The catch is that a sole proprietorship draws no line between you and the business. There is no separation, so a lawsuit or a debt against the business is a lawsuit or a debt against you personally, with your savings, your home, and your other assets exposed to it. And you operate under your own legal name, which for this work is its own problem, since your legal identity ends up on the things a sole proprietor signs and gets paid through.
The common step up is the LLC, a limited liability company you register with your state. The point is in the name. An LLC creates a legal entity separate from you, so the business’s liabilities mostly stay with the business: if a copyright claim, a contract dispute, a falling-out with a collaborator, or a chargeback fight turns into a legal problem, it is generally the company on the hook rather than your personal home and retirement. It also comes with an EIN, a tax ID you can use in place of your Social Security number on contracts, signups, and payout setups, which keeps a piece of your legal identity off all of it. As a solo creator you want the simple single-member version, and a multi-member LLC only makes sense if you genuinely have co-owners, which the collaboration articles get into. The costs are a setup fee and an annual state fee or franchise tax that varies enormously by state, steep in some and minimal in others, so check what yours charges before you choose where to form.
One thing an LLC does not do is save you tax by itself. By default it is a pass-through, meaning the income lands on your personal return the same way a sole proprietor’s does, and the business expenses the taxes article covers are deductible whether you have an LLC or not. What the LLC gives you on the tax side is the option to change how you are taxed later, which is where the S-corp comes in.
The privacy benefit of an LLC has a catch worth knowing before you file. The formation paperwork is usually public record, and done naively, under your own name in your home state, it can link your legal identity to your business and from there to your persona, which is the exact opposite of what you wanted. Keeping your legal name off the public filing is a normal and legal thing to arrange, through a registered agent service and the formation rules of certain states. Arranging that keeps the privacy benefit real, while filing carelessly under your own name can expose the identity you were trying to protect. Set it up deliberately with someone who knows how, and the identity-protection article later in this chapter goes deeper into keeping your legal self and your public work apart.
The S-corp is a tax election rather than a different kind of company you form from scratch, something an LLC can elect once it makes sense. Past a certain income it can lower your self-employment tax by letting you split your earnings into a reasonable salary, taxed the usual way, and remaining profit that is not subject to the same self-employment tax. The cost of that saving is real complexity: you have to run payroll, pay yourself that defensible salary, and file more, so it only pays off once your income is high enough to clear the added overhead, and a professional should run your actual numbers before you elect it. The C-corp, the other structure you will hear about, exists mainly for businesses raising outside investment and brings double taxation with it, so it rarely fits a solo creator.
The sensible path is to start simple and formalize as you grow, rather than over-engineering on day one or putting it off until a problem forces it. A sole proprietorship is fine while the income is small and you are still finding your footing. An LLC earns its cost once the money is real, once you have personal assets worth shielding, once your privacy genuinely matters, or once you are signing contracts and working with collaborators. The S-corp election waits until your income is high enough to justify the overhead. The trigger for each step is your own situation rather than a fixed number on a chart, so the honest answer to which structure you need is that it depends, and that is what the professional is for.
Find an advisor who understands adult work, because a generic accountant or lawyer may not grasp the payment processors, the banking refusals, the privacy stakes, and the platform realities that shape this business. Someone who has worked with sex workers or adult creators is worth seeking out over a cheaper option who treats your situation like any other small business and misses what is specific to it. Treat everything here as the map for that conversation and not a substitute for it, and verify the rules for your own state and country, since structures and their names differ across borders and the working-across-borders article covers operating internationally.
Once you have a structure, even just a deliberate sole proprietorship, the first practical thing it calls for is separating your money from your personal finances. A dedicated business bank account is what makes that separation real, keeps your bookkeeping clean for tax time, and, if you formed an LLC, is part of maintaining the very liability protection you set it up for. That account is the next article, on setting up business banking as an adult creator, where the harder problem is often finding a bank that will keep you.