I had seen a post on LinkedIn celebrating a bill establishing Artist Corporations passing out of committee in Colorado. Since I had never heard of that before, I did some additional research.
It is no wonder I hadn’t heard the term before. If it passes the full legislature, Colorado will be the first state to offer this corporate structure. Artists living anywhere would be able to incorporate themselves in Colorado.
According to Colorado Public Radio the goal is to make it easier for artists to incorporate versus a traditional LLC. Though the A-Corp website has a tool to help people determine whether an A-Corp or LLC would be better financially.
The A-Corp structure ensures artists maintain at least 51% ownership in order to protect their interests and the work they produce.
It also provides an option that falls between a traditional LLC and the reporting burden of a 501 (c) (3) non-profit structure:
“Structurally, we are forced into a binary. Either operate as a traditional for-profit business, which doesn’t account for our public impact or protect us fully, or form a nonprofit, which often comes with administrative burdens that are not feasible for individual artists or small teams.”
This feature appealed to a senator representing a rural district as enabling creatives to thrive while offering programs and opportunities to smaller communities.
Another possible benefit providing leverage in negotiating health insurance.
“It allows there to be more of a collective power where, for example, we can go to insurance companies and argue, ‘Hey, there should be a group plan for artists corporations. This is a great customer base for you to introduce a specific plan for,’” he said. “Whereas right now, artists have nothing like that.”
