What is a sole proprietorship?

The sole proprietorship involves a single, individual owner who is liable for all of the debts, obligations, and liabilities of the business. Business may be conducted under a trade name providing compliance with North Carolina law which entails the filing of an assumed name certificate. With respect to federal income taxes, income of the owner is reported on Schedule C, Business or Profession, and attached to the owner’s tax return setting forth the income or loss of the business. A disadvantage of the sole proprietorship is that it offers no protection of your personal assets from creditors of the business.