A business where one person owns the entire business and reports all profits and losses on his or her personal income tax return.

• Control - complete control of the business
• Liability - owner is personally responsible for the debts and liabilities of the business
• Taxes - all income and expenses of operation will be reported using supplemental forms on the owners tax return.
• Administrative obligations - three categories: support income and expenses show on tax return, ensure business is running efficiently, and establish that the business follows licensing rules.