What is a sole proprietorship?
Being self-employed means you're a sole proprietor, and your business is a sole proprietorship.
Sole proprietorships:
Are owned by one person—you don't have any partners.
Are unincorporated—you haven't filed any legal forms to incorporate your business.
Have no legal distinction between the owner and the business—you are entitled to all the income, but also must pay the bills, including taxes.
A married couple can be considered sole proprietors when they elect on their 1040 to treat their jointly owned and operated business as a qualified joint venture.
Organizations that aren't sole-proprietorships:
Partnership
Corporation
S corporation
Limited Liability Company (LLC), except a single-member LLC that doesn't elect to be treated as a corporation
When you're a sole proprietor, you'll need to file Form 1040 (Individual Income Tax Return) with a Schedule C to calculate your net profit or loss.
Once we determine you have self-employment income, we create your Schedule C and also review the income and expenses associated with your business.
