Sole proprietorship

A sole proprietorship is a form of organization for a business. In this form, the business consists of an owner-operator, who owns personally all the assets of the company, and is personally liable for all the liabilities of the business.

The main advantage of sole proprietorship is that it is extremely easy to organize; if a good is being sold, then usually the only paperwork to be done is filing for a vendor's license, and supplements to the owner's personal income tax. The main disadvantage is that the owner has unlimited liability; if the business is sued or fails, the owner's personal assets can be used to pay back any debts or other obligations.