Starting a Business – Register an LLC or Start Sole Proprietorship


Published -

Register an LLC or Start Sole Proprietorship

Joe Escalante, Esq. guides on starting your business as a DBA, LLC or corporation.

What factors should an entrepreneur consider when choosing between a sole proprietorship and an LLC?

Starting a Business – Register an LLC or Start Sole Proprietorship

Starting a business is an exciting journey but comes with its fair share of challenges. One crucial factor that any entrepreneur must decide early on is the legal structure for their business. Two common structures are Limited Liability Company (LLC) and sole proprietorship. This article will discuss these two options to help entrepreneurs make an informed decision.

Sole Proprietorship

A sole proprietorship is a business structure where the owner and business are considered the same legal entity. In other words, the owner is the business, and there is no distinction between personal and business assets. Sole proprietorship is the simplest business structure with minimal legal requirements. It is ideal for startups with a low risk and a single owner.

The advantages of sole proprietorship are the ease of setup and low cost of establishment. Unlike LLC, no formal registration process is necessary. An entrepreneur can begin business operations once they satisfy any relevant state and local licensing requirements.

However, a sole proprietorship has several disadvantages. The owner is personally liable for all business obligations, including debts and lawsuits. This means that if the business incurs losses or legal claims, the owner’s personal assets are at risk. Additionally, sole proprietors find it challenging to secure business loans as they lack the legal protection for lenders.


A Limited Liability Company (LLC) is a legal entity that separates the business’s liabilities and obligations from those of the owner. It protects the owner from personal financial risk in the event of lawsuits and business losses. LLCs are becoming the preferred option for most businesses as they provide legal protection, but still, maintain a simple structure ideal for small businesses.

The benefits of LLC are that the business owner enjoys personal asset protection as the company’s legal entity is separate from the owner. Additionally, LLCs can have multiple owners, making them ideal for partnerships. Additionally, LLCs can obtain additional capital through investment and lending since the liability for the business does not transfer to the owners.

On the downside, LLCs have a higher cost of registration and more stringent governance requirements than sole proprietorships. They require additional legal fees for registration, annual filings, and other legal services.


In conclusion, the choice between LLC and sole proprietorship depends on the entrepreneur’s goals, capital, and risk exposure. Each legal structure has advantages and disadvantages that entrepreneurs should weigh before making a decision. While sole proprietorship is simple and affordable, the risks are relatively high. On the other hand, LLC provides a higher level of protection from personal liabilities at a higher cost of setting up and maintaining the structure. Regardless, consulting with an experienced lawyer before making a decision is the best way to ensure you make an informed decision.

8 Total Score

User Rating: 4 (1 vote)
Read More
Filter by
Post Page
Hybrid Business Model Business Insghts Instagram Reddit Partnership Twitter Sole Proprietorship
Sort by

3 POWERFUL Ways To Profit From Your BLOG… Starting TODAY!

What’s Most Important Tool Should Every Serious Marketer Have? BLOGS! …(A.K.A. W


15 NEW “Pandemic-Created” Business Ideas in 15 Minutes

26 million Americans are without a job right now, and that’s just in the U.S. alone. It’s a


How To Run A Profitable Business & Make Money

What are clients really asking when say, “How much does this cost?” What I wished I knew when


Why I Don’t Have A Business Partner Anymore

How do you find a good business partner? What should you consider when making a formal business


Teen Millionaires | The kids running successful businesses who say you can too | Sunday Night

The million-dollar kids – Alex Cullen meets the youngsters with big dreams and even bigger success


How To Avoid Key Online Business Mistakes.

Do you have an online business that is not performing as well as you would like it too? If so, you could be


Introduction To Online Business 1-2-3

There are millions of people making a full-time income on the internet or working part-time hours from the comfort


Attracting Web Business

So you’ve finished building a great website, and you’re ready to start raking in the profits – if you c


10 Easy Steps For Getting Video On Your Business Website

I’m often asked, “I have no video training, but I want to put video on my website to help promote my


Internet Business Ideas

These are a few new internet business ideas that I won’t be trying, but I hope that someone will. The


Fastest Electric Wheel Ever!

A comprehensive review of the Veteran Sherman —the fastest electric unicycle ever! The highest performance


Electric Plane Of The Future | Archer

Electric Plane Of The Future | Archer

Electric Plane This is the Plane & Transport


10 Coolest New Methods of Transportation

New Methods of Transportation Top 10 new vehicles


Inside China’s High-Tech Dystopia

High-Tech Dystopia Inside China’s High-Tech


The ONE THING That Holds New Programmers Back

New Programmers  One skill to work on that I


Would a military Space Force accelerate space technology?

Space Force Astrophysicist Neil DeGrasse Tyson


How Microwaving Grapes Makes Plasma

A bisected grape in the microwave makes plasma. But how does it work? A grape is the right size and


DEMA SHOW 2019: The One New Scuba Gear Everyone Is Talking About!

This is the Hydroid Aquabreather. Is it a rebreather? No. Is it SCUBA? Yes, but not as you’ve ever seen it


Tesla Autopilot For 24 Hours Straight!

Tesla Autopilot Tesla Autopilot For 24 Hours


InfoSearched | Business Research & Information