| A
sole proprietorship is an unincorporated
businessthat is owned
by one individual. It is the simplest form of businessorganization
to start and maintain. The businesshas no existence apart from you,
the owner. Its liabilities are your personal liabilities and you
undertake the risks of the businessfor all assets owned, whether
used in the businessor personally owned. You include the income and
expenses of the businesson your own tax return.
 | TIP: Use a separate Form 1040, Schedule
C, Profit
or Loss From Business (PDF), to report the profit or loss from
each business(except farming) you operate as a sole
proprietorship. If you have only one business , you may be able to
use Schedule C-EZ, Net
Profit From Business (PDF). |
| TIP: If you are the sole proprietor of a
farming business , use Schedule F (Form 1040),
Profit or
Loss From Farming (PDF), to report your profit or loss.
|
| TIP: For more information on sole
proprietorships, refer to Publication 334, Tax
Guide for Small Business. If you are a farmer, refer to
Publication 225, Farmer's
Tax Guide. |
| TIP: If you and your spouse both participate
in a business , refer to our information for a husband
and wife business . |
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