How to Start a Screenwriting Business

Start a screenwriting business by following these 10 steps:

1. Plan your Screenwriting Business
2. Form your Screenwriting Business into a Legal Entity
3. Register your Screenwriting Business for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Screenwriting Business
6. Get the Necessary Permits & Licenses for your Screenwriting Business
7. Get Screenwriting Business Insurance
8. Define your Screenwriting Business Brand
9. Create your Screenwriting Business Website
10. Set up your Business Phone System

We have put together this simple guide to starting your screenwriting business. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Screenwriting Business Name Generator

If you operate a sole proprietorship, you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name, we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability.

It's very important to secure your domain name before someone else does.

What are the costs involved in opening a screenwriting business?

Screenwriters can get started with practically no tools at their disposal, all you really need is a computer and your ideas. Some screenwriters pay professionals for advice about how to alter their writing to make it more attractive to studio executives, but that is a personal choice for each writer.

What are the ongoing expenses for a screenwriting business?

Ongoing expenses are almost negligible (e.g., computer maintenance, transportation money to and from meetings, etc.) However, screenwriters generally don’t get paid until they have a completed work that’s been purchased. This means that all general living expenses from rent to food will need to be covered by the screenwriter during that time.

Who is the target market?

The target market is typically producers, or those who finance films. You're looking for someone who will read your script and then pay you for the rights. Some screenwriters may choose to get their scripts turned into films on an independent basis, though this is much more expensive and difficult to do successfully. In this case, screenwriters may be asked to star in, direct, or finance the film on their own or with the help of a small team with a limited budget.

How does a screenwriting business make money?

Screenwriters make money by selling their scripts to producers, or by producing their own films for a cut of the eventual profits.

How much can you charge customers?

Most screenwriters start out making little, or by selling their work based on eventual sales. However, top screenplays that attract millions of movie-goers can draw huge numbers. It’s not unusual for the most successful screenwriters in the business to earn up to a million dollars for each screenplay.

How much profit can a screenwriting business make?

Since upstart costs and ongoing expenses are so small, screenwriters make extreme profits. For the top sellers in Hollywood, they may be able to make up to four million a year or so.

How can you make your business more profitable?

You may want to branch out to directing your own movies to increase profitability. Screenwriters who take on fluid roles in the movie industry become that much more indispensable. It also gives you a greater degree of control over the fate of your story and vision.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your screenwriting business is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a screenwriting business.  Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

This business is excellent for someone who loves film and understands how a movie comes together on the big screen. They should love to put their own creative twist on stories, whether they're new and bold or a tale as old as time. Writers need to understand what audiences are looking for, and how to merge their creative vision with public demand.

What happens during a typical day at a screenwriting business?

Screenwriters may have the following to-do list on any given day.

• Developing outlines for scripts
• Researching/developing characters
• Finding/managing an agent
• Attending meetings with producers

What are some skills and experiences that will help you build a successful screenwriting business?

Screenwriters need to really understand what makes their audience enjoy and relate to a movie. Film school may help with this, but is by no means a requirement. Producers are going to be looking for what each target demographic wants, whether you're writing romantic comedies or hard-core horror. The quality of the writing isn’t always as important as the value of the story, though screenwriters should enjoy the act of writing as well.

Some screenwriters write for character development, some write to project action and adventure onto the big screen, and others write to tell a larger story, such as a documentary about climate change. You should have an inherent sense of how to create characters and situations that will connect with the viewer on a deeper level, or at least offer them an entertaining break from reality.

What is the growth potential for a screenwriting business?

There will always be demand for talented screenwriters who can create stories that spark audience’s emotions and imaginations. The growth potential for someone who can consistently attract audiences is practically unlimited.