The sole proprietorship is perhaps the most straight-forward option. It is a business structure where the business is owned and controlled by one person and that person is liable for any of the business' obligations.
Some aspects of a sole proprietorship include:
- You don't have to file any forms with the state, though you still need to obtain any required licenses and permits.
- Owners are personally liable for any debts incurred by the business.
- Income from the business is reported on your personal income tax return.
Per the Small Business Administration (SBA), some of the advantages of using a sole proprietorship structure are that it is low cost, owners have control, and taxes are simplified, while the disadvantages include unlimited liability and that you must pay self-employment taxes. As the owner of a virtual paralegal business, this may be an easier route to take to get your business off the ground and running.