LEGAL GUIDE
Written by attorney Adam Nathaniel Williams | Mar 7, 2016

Steps to Establish a Sole Proprietorship in Washington

An individual or a married couple qualifies as a Sole Proprietorship. Sole proprietorships remain the most common form of business structure because of the simplicity to form and operate.

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This entity enjoys greater flexibility of management, fewer legal controls, and fewer taxes. However, the business owner is personally liable for all debts incurred by the business. Advantages include a sole proprietor enjoys complete control and decision-making power over the business; sale or transfer can take place at the discretion of the sole proprietor; the sole proprietor makes no corporate tax payments; formation of a sole proprietorship incurs minimal legal costs; and few formal business requirements in formation and operation. Disadvantages include all creditors may hold the sole proprietor of the business personally liable for the debts and obligations of the business; all liability risks extend to acts committed by employees of the company; all responsibilities and business decisions fall on the shoulders of the sole proprietor; and investors rarely invest in sole proprietorships.

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