A Sole Proprietorship (SP) is an individual owning and operating a business in his or her own name without partner(s). In a SP:
- All liabilities and debts of the business are the personal debts and liabilities of the owner.
- Business income is reported and taxed through the owner’s personal tax return.
- All assets of the business are assets of the owner, subject to all debts of the owner.
- The business exists only as long as the owner does not die or retire; however it may be sold, or transferred by gift or will, to another individual or legal entity.
- If you do business as a SP under your name, no formation document is necessary; however if you operate the business under another name, you must register an Assumed Name Certificate
(“d/b/a”, or doing business as) by filing with the Clerk of the county(ies) in which the business operates.