Are you a writer or a photographer? Are you an individual who takes on jobs on a contract basis? Are you a freelance caterer who gets paid per booking? Or are you perhaps a salesman who relies on commissions? You may not be aware of this but you already own a sole proprietorship business. You automatically become a sole proprietor if you are not registered as a corporation or an LLC and not part of a payroll.

While it may sound like something to be really proud of, you must not forget that you have responsibilities to face. This includes registering your services, getting a business license, and avail law permit so you can operate legitimately. Keep in mind that although you will solely enjoy the benefits of your business, you will also have to endure alone whatever financial problems your business will encounter.

Below are some of the basics of sole proprietorship that you must remember.

Sole proprietorship means you have the sole liability for business debts. This means you alone will have to face the firing squad sent by the creditor if you so fail to pay a supplier, or if you fail to pay debts, or lose to litigation. You will risk losing your properties, your house, and other earthly possessions.

Other than that, in the eyes of the IRS you as the owner of your business will have to report all income and losses on Form 1040. You will have to pay a self-employment tax including contributions to Medicare and to Social Security.

Registering your business is fairly easy. You don’t have to go the long mile that LLC and corporations have to go through when filing their business. All you have to do is indicate that you’re doing this business solo and voila! You are good to go.

Related Posts
Top reasons that can severely affect your landlord business
There are mistakes that will definitely affect your landlord business and these are what you should avoid. 1.Tenant discrimination intentionally or unintentionally. This warrants a one-way ticket to a legal proceeding. ...
READ MORE
How to get workers compensation lawyer
For those of you who are in job need to have a clear idea about what you as an employee are liable for. And by this aspect it does not ...
READ MORE
Chapter 7 Bankruptcy
If you go for Chapter 7 bankruptcy, you may have a lot or all of your debts canceled. On the other hand, you might need to sell some or all ...
READ MORE
DUI:Driving under the influence
Dui (DUI), generating while intoxicated (DWI), drunk(en) generating, drink generating, working under the impact, generating under the impact, or impaired generating is the criminal activity of generating a automobile with ...
READ MORE
Real estate property purchasing option?
When you are investing on a real estate property, you can choose to buy through real estate investment trust (REIT), limited liability company (LLC) or under your own name. Choosing ...
READ MORE
How to hire a real estate attorney?
It's really a great idea to hire a real estate attorney early on because it will help you save more time and money as well as defend you from various ...
READ MORE
How a real estate attorney can help you during your home purchase
There are different kinds of real estate transactions such as commercial leases, residential rentals, single-family home, and investment property transactions. To make sure that your real estate transactions run smoothly, ...
READ MORE
How to deal with your business debts
Around 90 percent of businesses fail before they even reach ten years. And in this challenging economy, it would be normal if your business would dwindle down to failure. This ...
READ MORE
Negative consequences of getting traffic ticket
Will traffic tickets lead to imprisonment? This may be the most negative consequence for getting a traffic ticket, but usually, only those convicted with serious traffic violations have high possibility ...
READ MORE
How to get your security deposit back?
Before you can move in to a rented apartment, you have to deposit a big amount of money to the landlord first. This money is called the security deposit. This ...
READ MORE
Top reasons that can severely affect your landlord
How to get workers compensation lawyer
Chapter 7 Bankruptcy
DUI:Driving under the influence
Real estate property purchasing option?
How to hire a real estate attorney?
How a real estate attorney can help you
How to deal with your business debts
Negative consequences of getting traffic ticket
How to get your security deposit back?