Most small businesses that have one owner start out as a sole proprietorship--some without even realizing that's what they are. If you start a one-person business and don't form a corporation or limited liability company, you have created a sole proprietorship. You don't need to file any papers or go through any approval process, other than the usual permit and licensing requirements that would apply to any business. Because it's so simple, it's often how small businesses start out. If your business grows and you want to add more owners, you will need to change from a sole proprietorship to a partnership, limited liability company, or corporation because a sole proprietorship is by definition a single-owner business.
If you have a solo proprietorship, you'll want to understand the basics about that type of business entity, including the tax implications, personal liability issues, and formation questions. You'll find all that information and more in this section.