2. 
A
sole
proprietorship
is
a
business
established, owned, and controlled by a single person.

Sole proprietorships come in all shapes and sizes.

The owner realizes all the profits and assumes
responsibility for all losses.

4. 
Of the four forms of ownership, the
proprietorship is by far the easiest to form.
sole

The government exercises very little control over the
establishment of new sole proprietorships.

Start-up can be immediate and simple.

You may need to obtain licenses or permits for your
particular type of business.

5. 
Sole proprietorships are simple to start. No formal
action is required.

A sole proprietorship may be started immediately.

The owner has total control of all aspects of the
business.

The owner receives all the profits.

The business itself pays no income tax; the owner
pays income tax as an individual.

6. 
The owner has unlimited responsibility for
losses, debts, and other liabilities the business might
develop.

The owner must make all the decisions.

The owner is the only person who can arrange
financing or capitalization.

The existence of the business ends upon the owner’s
death.

7. 
Sole proprietors make all the decisions regarding the
operation of the business.

The assets of sole proprietors are not considered legally
separate from the assets of the business.

Owners of sole proprietorships report business income
and expenses on their personal income tax returns.

8. Partial list of tax forms
 Form 1040: Individual Income Tax Return
 Schedule C: Profit or Loss from Business
(or Schedule C-EZ)
 Schedule SE: Self-Employment Tax
 Form 1040-ES: Estimated Tax for Individuals
 Form 4562: Depreciation and Amortization
 Form 8829: Expenses for Business Use of Your
Home
 Employment Tax Forms