What is a "sole proprietorship" and what are its tax implications?

What is a "sole proprietorship" and what are its tax implications?

Gregg Wind (Partner, Wind Bermer Hockenberg, LLP) gives expert video advice on: Can starting a business decrease my taxes? and more...

A sole proprietorship is a business, that's usually owned by a single individual, that isn't incorporated, and sole proprietorships usually report their income and their expenses on Schedule C, which is part of the federal 14, the personal tax return. Sole proprietors generally have to deposit their taxes on a quarterly basis, and the onus is on the business owner to figure out what they actually owe. Generally, if you're a sole proprietor, you may not enjoy the same liability protection you would if you were incorporated. Corporations, for the most part, and I'm not a lawyer, but for the most part corporations protect you or limit your liability to the assets inside of the corporation. Sole proprietors sometimes have personal or unlimited liability, but you should check with your attorney to find out for sure.