It’s spring, so your artistic operations team might be in the thick of drafting and sending contracts to next season’s guest artists. Regardless of your contracting cycle or when you read this article, here are four important elements of a guest artist contract that your finance team will appreciate having included.
Disclaimer: What is a blog post about a legal or financial topic without a disclaimer? This is not legal advice. You should not be getting your legal advice from a blog post. The purpose of this post is to give you things to think about before taking action. Speak to an accountant and/or a lawyer about specifics.
Who Is Receiving the Contract Payment?
Is the performance fee going to the guest artist directly? Is it going to their talent management agency? That detail should be clearly stated in the Compensation section/paragraph of the contract, since it affects what tax paperwork your finance team needs to have. Speaking of which:
If the payment is going to a “U.S. Person,” be it the individual guest artist or their talent management agency, your finance team needs a completed and current Form W-9 on file. Even if your organization has hired this guest artist before, it’s a good idea to request a completed Form W-9 every year to capture any address changes. If you send contracts for digital signature through a platform such as DocuSign, consider merging a PDF of the Form W-9 to the body of the contract so it can all be completed in one package along with the signature.
Payments to foreign persons or non-resident aliens are beyond the scope of this article, but there is some information to get you started about Form W-8 BEN and Form 8233 on the IRS website, and please consult a tax professional for further guidance when paying non-U.S. guest artists. In many cases, non-U.S. guest artists are on the rosters of U.S.-based talent management agencies, in which case you simply need the agency’s Form W-9.
Timing and Method of Payments
When and how does your finance team need to issue payment? Do they need to prepare a physical check for backstage staff to hand to the guest artist at the end of the concert? Does a check need to be mailed to the agency’s office within so many business days? Can your finance team remit payment electronically, and if so, when should funds be submitted? These details should be clearly stated in the Compensation section/paragraph of the contract, with the mailing address or bank account information captured along with the signature.
Are any of your guest artists part of a unionized workforce and as part of hiring them, do you need to remit any payments to a third-party union office or other entity? Will your guest artists be issued a per diem (and when and how do they need to receive the funds) or submitting reimbursable expenses after their service period? All of these details should be included in the contract.