A sole proprietorship is a type of business owned and operated by a single individual. This structure is the simplest form of business organization, allowing the owner to have complete control over all decisions. Sole proprietors are personally responsible for all debts and obligations of the business, meaning their personal assets can be at risk if the business faces financial difficulties. One of the main advantages of a sole proprietorship is the ease of setup and minimal regulatory requirements. Owners can report business income on their personal tax returns, simplifying the tax process. However, this structure may limit the ability to raise capital and can pose challenges in terms of liability and business continuity.