TRUTH 19 Choosing a form of business ownership

When you launch a business, you need to choose a form of legal entity. Sole proprietorship, partnerships, corporations, and limited liability companies are the most common. There is no single form of business ownership that works best in all situations.

Sole proprietorship—The simplest form of business ownership is the sole proprietorship,[1] which involves one person. The person and the business are essentially the same. The biggest advantage of the sole proprietorship is that the owner maintains complete control over the business. The biggest disadvantage is that the sole proprietor is responsible for all the liabilities of the business. If a sole proprietor’s business is sued, the owner ...

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