Tax Structure
What is the name of the tax specifically on sole proprietor's income?
Self Employment Tax
True or false, sole proprietors are the only owners of their business
True
Name 3 National Examples of Sole Proprietorships
Publix Supermarkets
C&S Wholesale Grocers
Mars, Incorporated
What are the three types of taxes Sole proprietors are subject to?
Self Employment Tax, Income Tax, and Employment Tax
How much of the profit do sole proprietors keep after taxes
100%
Name 3 local examples of Sole Proprietorships
Law Offices of Steven Rockmacher
Inovo Kitchen
The Dilly Bean
Open Door Book Store
What percent of a sole proprietor's income is subject to Self Employment Tax?
92.35%
How much protection from liabilities is offered to sole proprietors?
None. Sole proprietors assume all of the risks potentially posed on their business. (lawsuits, debts, etc.)
Name the simplest of all business structures and why.
Sole proprietorship is the simplest of all business structures because there are few government rules and regulations required to startup and run a sole proprietorship.
What are the names of the two types of Employment Taxes sole proprietors must withhold from their employees?
Federal Insurance Contributions Act (FICA) and Federal Unemployment Tax Act (FUTA) taxes
Which business responsibilities fall on the sole proprietor?
What type of legal action is required to start a sole proprietorship?
There is no legal action needed to start a sole proprietorship because there is no need to form a board of directors, and there is no requirement to open a bank account for your business.
Name 5 tax deductions sole proprietors can claim each year
Self employment taxes, Healthcare insurance, Business mileage, Business meals at restaurants, Advertising costs, Rent and leasing costs, Home office deductions, Cell phone
Who is responsible for raising capital for a business operating as a sole proprietorship?
The sole proprietor is responsible for raising all of the capital required for their business, without any help from investors.
Why do many sole proprietors do business under their own name?
Sole proprietors assume all risk and pay all taxes, so there is no need to separate the business from their own personal assets.