Sole Proprietorship Facts

I am a sole proprietor when I file taxes. So I do understand a few of these things. All the same I made sure to look up information from different sources and bring them to you in one place. So I hope you enjoy this quick fact list and I hope it brings to light any questions you might have before you take on becoming a sole proprietor.

• If you are liable to pay self employment tax you will have to fill out a Schedule SE. Some other important forms include the 1040, and Schedule C. Those are available on the IRS website.
• The sole proprietorship is the simplest form of business although it’s not always the best one. That is something that you should determine on your own. I prefer it, but that doesn’t mean it is the right option for you.
• The financial risk is greater because if someone goes after your ‘business’ they are going after you as a person.
• When you die, the business dies. Because it is a sole proprietorship, if you are not alive anymore the business can not be passed on. It would have to be restarted by someone else.
• A sole proprietor can have employees and can carry on with most types of business.

If you’re looking for more information on filing as a sole proprietor and what that all entails, please feel free to check out the information from these websites that I used to gather the facts above.

Resources

Lawyers.com