A sole proprietorship is owned by one person. The owner is responsible for all debts and losses. A sole proprietorship is formed automatically when you start offering goods and services. Legally, there is no separation between you and your business.
One person can have more than one sole proprietorship. Each proprietorship would need to file taxes separately. An existing business has advantages like established customers and suppliers.
Taxation and Liability
Sole proprietors only pay taxes once on income. Sole proprietorships don’t file separate tax returns from owners.
Liability and continuity are disadvantages compared to other structures.
Ownership and Partnerships
Sole proprietorships can’t have more than one owner. If a second owner joins, it becomes a general partnership.
Sole proprietors can have a separate business checking account using a Doing Business As (DBA). An Employer Identification Number (EIN) isn’t necessarily linked to one’s Social Security Number (SSN).
Can You Have Multiple DBAs?
Yes, one person can have more than one DBA under a single sole proprietorship.