Aug
11
2023
What Is A Sole Proprietorship?
A sole proprietorship is a business operated by one individual (or a couple). The business is considered an extension of the individual (or couple), not a separate entity. The business profits and losses are included on the individual's personal tax return, and the individual retains personal liability for the business debts and lawsuits.
If you want to use a trade name instead of your own name for the business, an assumed name certificate must be filed in the counties where you do business.
What Are The Benefits Of A Sole Proprietorship?
1. Startup is quick and easy.
- All you have to do is hang out your shingle. Unless you do business under an assumed trade name, you don't have to gain permission from a governmental entity to open your business. You may, however, need licenses or permits depending on the type of business.
2. Business management is easy.
- You are the boss! Doesn't that sound good? You don't have to conduct meetings or follow other legal formalities.
3. Handling your taxes is simple.
- You simply reflect profits or losses from your business on your personal tax return. You will use a Schedule C to your tax return to reflect the business profit or loss.
4. Closing your business is simple as well.
- If you decide to stop doing business, all you need to do is close up shop and do your final tax return.
What Are The Disadvantages Of A Sole Proprietorship?
1. You bear all the risk of loss.
- If the business goes under, the losses all come out of your pocket.
2. Your personal assets are not safe.
- Your personal, non-exempt assets are subject to satisfaction of any business debts or liabilities.
3. You may end up paying more in taxes.
- You personally pay all the tax on your profits at your personal income tax rate. If your business is wildly successful, corporate tax treatment may be better.
- You will also have to pay self-employment tax.
If you are looking to start a business and you need help deciding if a sole proprietorship is right for you, please call Adair M. Buckner at (806) 220-0150 to set up a free initial consultation*.
*(The free consultation does not cover actual review of documents or giving legal advice on a specific situation.)
** This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, specific tax, legal, or accounting advice. We can only give specific advice upon consulting directly with you and reviewing your exact situation.
TESTIMONIALS
I needed an attorney I could trust who could handle my legal concerns regarding my mother’s Living Trust. Adair Buckner firmly set things right. She was my voice when I had none and knew how to protect me in the midst of negative chaos. I recommend Adair to anyone seeking justice.
It was way past time to finally get our Wills completed. This was something that was extremely complicated for us, but Adair and her assistant never made us feel like we were bothering them...and we (I) bothered them...a lot! Things were explained to us in a way that we could understand easily. Extremely professional and knows her stuff!
When my husband passed away, I contacted the attorney that we had used to prepare our wills but was unhappy with his attitude of indifference. I discovered Adair Buckner and all of my issues were resolved. Adair is professional, compassionate, and extremely knowledgeable. She saved me a large amount of money by processing my will in the appropriate manner to best suit my situation.
Adair Buckner has provided me with her excellent expertise in finalizing the sale of a buy/sell agreement and preparation of my Last Will & Testament. Adair efficiently applies her knowledge to your specific needs. I highly recommend her.
Losing my Mother and being appointed as Executor of her estate was overwhelming. Adair was very professional and personable. She handled and processed the estate with ease and kindness.
Adair drew up a beautiful power of attorney and Will for my father in a timely manner. I highly recommend that you use her. She’s a wonderful lady.
Trying to get our LLC changed over after moving to Texas was complicated, but Adair Buckner made the process so simple! We just gave her the details, and she handled everything quickly and professionally. Thank you, Adair, for making this part of our move stress-free!
Mrs. Buckner did a full estate plan for me. Her work was excellent, her communication was great, and the price was reasonable. I would highly recommend her for your estate planning needs.
We appreciate Adair Buckner’s professional and personable service. Our legal needs were met promptly and succinctly. We would not hesitate (and do!) recommend her to our family and friends.
This was as painless as it gets to hire an attorney in Amarillo Texas. Handled all the estate needs and never had to appear in court. You won't find any better and I use Attorneys quite often in my line of work.