Note: The tips here are meant to provide an overview of best practices regarding business setup for freelance medical communicators. For advice specific to your situation, seek counsel from authorized financial experts.
Starting a freelance medical writing business is an exciting step, whether you're pivoting from full-time employment, transitioning from a clinical background, or starting out in the field after education and training.
But freelancing isn’t just about writing and editing content—it’s also about running a business.From the legal paperwork to financial systems, the behind-the-scenes setup can feel overwhelming, but it's essential for long-term success. In this blog, we’ll walk through steps to get your freelance medical writing business off the ground, from choosing a business structure to managing finances and preparing for future opportunities.
Choose the Right Business Structure
Choosing an optimal business structure is key for freelance medical communicators. The three most common business structures—sole proprietorship, LLC, and S corporation—each come with pros and cons. Key points about each business type come from an article from Collective, which offers back-office solutions for solo entrepreneurs
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A sole proprietorship is what you automatically have if you begin freelancing and don’t set up an LLC or corporation. It’s easy to start but offers no liability protection, meaning your personal assets could be at risk if legal or financial issues arise.
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An LLC (limited liability company) is relatively simple to form and provides a layer of legal protection between your business and personal assets. The business exists separately and can have its own bank accounts, borrow money, and more. Setting up an LLC takes a little more work, requiring you to file articles of organization with your state and pay a state filing fee.
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An S-corporation offers additional tax advantages for those earning higher income, allowing you to pay yourself a salary and take additional profits as distributions, potentially reducing self-employment taxes. However, it involves more paperwork and stricter requirements, and you can get many of the same tax benefits more affordably with an LLC.
Tip: Consider incorporating as an LLC or S -Corp if you're consistently bringing in clients, managing risk, or planning to scale.
Understand Legal Requirements
Before launching your freelance medical writing business, it’s essential to register and legalize your business to operate professionally and stay compliant. Information services company Wolters Kluwer describes important legal elements.
Business Name
Start by choosing and registering your business name. If you’re using a name other than your legal name, you’ll need to file a DBA (doing business as) with your state or local government. Next, apply for an EIN (employer identification number) from the IRS—this is useful for tax filing, even if you don’t have employees.
Business Licenses or Permits
Depending on your location, you may also need state or local business licenses or permits. Check your city or state requirements to avoid penalties.
Contracts
Even as a solo freelancer, contracts are a must. Clear written agreements help define scope of work, deadlines, payment terms, and intellectual property rights. They also protect you in case of disputes.
Tip: Keep digital copies of all business registrations, contracts, and permits organized in a secure, backed-up folder—you’ll thank yourself later.
Set Up Business Finances
Setting up your business finances lays the foundation for staying organized and professional as a freelance medical writer.
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Start by opening a separate business bank account to keep personal and business expenses clearly divided. This makes tax time easier and improves financial clarity.
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Next, choose an accounting tool that fits your workflow. Platforms like QuickBooks, FreshBooks, or even Excel can help you track income, expenses, and invoices efficiently. Keeping accurate records not only supports better decision-making but also helps you stay compliant with tax requirements.
Tip: Scheduling regular, small blocks of time to update records is easier than trying to corral a whole year of them before tax time.
Plan for Taxes
Freelance medical writers are responsible for managing their own taxes, including setting aside money for quarterly estimated payments. You’ll need to do some figuring to calculate how much of your income to save—this could potentially range from 15% to 40%.
Working with an accountant, especially one familiar with freelancers, can help you meet the most current business requirements and take advantage of deductions. Many business expenses are tax deductible, including business-related software, home office costs, internet service, and professional memberships like AMWA.
Tip: To deduct a home office, you must have a dedicated space for your freelance medical writing business.
Consider Liability Insurance
Depending on your individual situation and freelance business structure, consider insurance coverage to protect yourself from any client claims. Professional liability insurance, also known as errors and omissions (E&O) insurance, can cover legal fees, settlements, and defense costs if a client claims your work caused financial loss or harm. Client contracts should also specify the limits of liability for your content.
Tip: Consider getting expert advice about whether your business needs professional liability insurance.
Launch Your Freelance Medical Writing Business
Starting your freelance medical writing business requires more than developing a portfolio—it’s about building a solid foundation that supports long-term success. From choosing the right business structure and understanding legal requirements to organizing your finances and protecting your business, each step plays a crucial role in turning your passion into a thriving business.
Whether you’re just starting out or refining your freelance setup, AMWA offers expert-backed resources to guide you at every stage.
AMWA acknowledges the contributions of Kathleen Labonge, MBA for peer review in the development of this AMWA resource.
