A sole proprietorship is the simplest US business structure, where a single owner operates a business without forming a separate legal entity. The status is automatic by default whenever one person does business in their own name without incorporating. All business profits and losses are reported on the owner's personal tax return (Schedule C), and the owner has full personal liability for all business debts and obligations. It is the default starting point for freelancers, consultants, and side-business operators, and the wrong structure for any business with meaningful liability exposure or growth ambition.
The advantages: no formation required (you're a sole proprietor automatically when you start doing business; no f...