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Sole Proprietorship - DOC

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									Sole Proprietorship

Sole Proprietorships are types of a business entity in which case has no isolated
existence from its owner. The barriers of liability by a corporation and its
constrained liability partnerships do not employ to the sole. The debts of the
business are debts of the owner itself. A sole proprietor essentially means, “an
individual performs business in their own name and there is one single owner".

Advantages of a Commercial Sole Proprietorship:

    A sole proprietor has direct control as well as any decision making authority
      over the business
    A small number of recognized business requirements
    No corporate tax expenses
    Any sale or alteration can take place at any giving time at he discretion of
      the sole proprietor

In contrast, an indistinguishable small business operation as a corporation or
partnership would be required to arrange and submit a tax return several pages in
length plus quarterly as well as annual payroll tax returns. In addition, all of the
profits from the law firm go right to the owner. A sole proprietorship often has a
lot of freedom from the government regulations. Every form of commercial
ownership has several types of government regulation, but in general, the
commercial sole proprietorship has the least.

A commercial law firm structured as for a sole proprietorship will apt to have a hard
time raising capital since shares of the law firm cannot be sold, and there is a
slighter sense of authenticity relative to a business organized as a corporation or
limited liability company (LLC). Hiring employees may also be difficult. This type
of business will have unconstrained liability and, as a result, the proprietor is
personally liable if the law firm is sued. The life span of the law firm is also
tentative. As soon as the owner decides not to have the law firm anymore, or the
insurance, and may come across complexity finding any if, one of the family
members to be covered has a previous health issue. Another shortcoming of a sole
proprietorship is that as the law firm becomes successful, the risks accompanying
the law firm have a propensity to grow. To reduce those risks, a sole proprietor
has the choice of forming a limited liability company (LLC). Note down that such
an LLC would still be treated as a sole proprietorship for income tax accounting

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