{"id":4908,"date":"2021-09-08T17:31:08","date_gmt":"2021-09-08T22:31:08","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/smallbusiness\/incorporation-and-legal-structures\/what-is-a-sole-proprietor.html"},"modified":"2025-11-05T00:33:00","modified_gmt":"2025-11-05T05:33:00","slug":"what-is-a-sole-proprietor","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/what-is-a-sole-proprietor.html","title":{"rendered":"What Is a Sole Proprietor?"},"content":{"rendered":"\n
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What Is a Sole Proprietor?<\/h1>\n\n
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\n By Tim Kelly, J.D.<\/a> | Legally reviewed by Catherine Hodder, Esq.<\/a>\n | Last updated\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

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A sole proprietor<\/span> is an unincorporated business<\/span> owned and managed by one person. However, since there is no legal difference between the owner and the business, the owner has unlimited liability<\/span> for the business\u2019s debts and obligations.<\/p>\n\n <\/div>\n\n\n\n

Sole proprietors<\/span> own their own unincorporated business<\/span>. Businesses are unincorporated when they have not been registered with the state. This business type differs from legal entities<\/span> like\u00a0limited liability companies<\/span> (LLCs)<\/a>\u00a0and\u00a0corporations<\/a>.<\/p>\n

Sole proprietorships<\/span> appeal to self-employed<\/span> freelancers<\/span> and independent contractors because they are low-cost and easy to set up. Still, small <\/span>business<\/span> owners<\/span> should be aware of some risks before they start.<\/p>\n

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Key Takeaways<\/h3>\n