What are the advantages and disadvantages of single proprietorship?
2006-10-12 02:01:19 · 9 answers · asked by ann 1 in Social Science ➔ Economics
It's actually called a "sole" proprietorship. There are 3 main types of ownership (although, if you want to get fancy and start looking at LLCs, LLPs and FLPs, go to a lawyer).
First: sole proprietorship. You and your business are essentially one entity. You pay taxes on its income on your 1040 and if it gets sued (for whatever, a bad debt, an accident that was the fault of the business), you would be the one held liable.
Second: partnership. This is the same as the first one, except the ownership is split between or among more than one person.
Third: corporation. This is a separate legal entity. It pays its own taxes on its own tax return and has its own liability for debt, accidents, etc. It's harder to form but it offers more protection.
Recommendation: if you have a business that's pretty safe (e.g., you sell sweaters on the Internet), you need to worry less about liability and can probably be safe enough with a sole prop. On the other hand, if you (for example) run a lawn mowing service using hired help, you have a tremendous amount of exposure to liability for injury to that hired help and a corporation or other no-liability or limited-liability form of ownership is for you. Check with your friendly neighborhood lawyer. :)
Good luck!
2006-10-12 03:59:11 · answer #1 · answered by DancesWithHorses 3 · 0⤊ 0⤋
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There is no such thing as a single proprietorship. The legal forms of businesses are as follows: sole proprietorship, general partnership, limited liability partnership, limited liability corporation, Corporation (Chapter C), and Corporation (Chapter S).
2016-04-10 11:35:54 · answer #2 · answered by Anonymous · 0⤊ 0⤋
A sole proprietorship means one owner and boss; no partners. A single owner reaps all the rewards, but is also responsible for all the liabiliities, instead of spreading both around among one or more partners.
2006-10-12 02:06:06 · answer #3 · answered by The Baron 3 · 0⤊ 0⤋
A single or sole-proprietor means you have 1 owner of the business. Biggest advantage is "YOU are the 1 and only boss." It's YOUR business an nobody else's. Biggest disadvantages are that you're taxed at your personal income rate and have unlimited financial and legal liability.
2006-10-12 07:47:12 · answer #4 · answered by msoexpert 6 · 0⤊ 0⤋
Single Proprietor
2016-10-13 22:20:53 · answer #5 · answered by ? 4 · 0⤊ 0⤋
WHEN YOU ARE SUCCESSFUL IN A SINGLE PROPRIETORSHIP ONLY YOU GET RICH AND YOU PAY A LOT IN TAXES!! DISADVANTAGES IS THAT YOU PUT UP MORE OF YOUR OWN CAPITAL AND POSSIBILITY WHEN YOU GO KAPUT EVERYTHING YOU OWN WILL GO DOWN THE DRAIN AND YOU, ALONE HAVE TO WORK HARDER!!!
2006-10-12 02:06:04 · answer #6 · answered by livinhapi 6 · 0⤊ 1⤋
Single owner. Not a group or corporation.
2006-10-12 02:05:03 · answer #7 · answered by Letsee 4 · 0⤊ 0⤋
Solo Owner
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2006-10-12 02:11:19 · answer #8 · answered by SAM 5 · 0⤊ 0⤋
its also easier 2 start up and its cheaper. a corporation u need 2 incorporate and takes thousands of dollars.Also banks might not want 2 lend u money cause they think thats its 2 big a risk
2006-10-12 02:10:48 · answer #9 · answered by Anonymous · 0⤊ 0⤋