What Is A Sole Proprietorship_

If you're the only owner in your business, and haven't formed a business entity, then you are a sole proprietor. What this means is that there is no legal distinction between you and your business; you are one and the same. Not only are you your own boss, but there is no fee or process to form a sole proprietorship. All you have to do is start making sales. One thing that you will need, however, is a DBA; "doing business as" if you want to use a trade name. This usually ranges between ten dollars and a hundred dollars depending on the county your business is located in. When it comes to tax responsibilities if your business ends up owing more than a thousand dollars at years end the IRS requires you to make estimated quarterly tax payments in addition to your annual income tax return. Another nice aspect of sole proprietorships is that they don't have any ongoing maintenance implications or responsibilities to worry about. That said, one of the drawbacks to being a sole proprietor is that you have no protection you are held personally liable for any debts and obligations your business should incur. This means your personal bank accounts, and even your home residence, can be used to satisfy these debts. But hey, at least you get to be your own boss right?