A sole proprietorship is the simplest and most common structure chosen to start a business. It is an unincorporated business owned and run by one individual with no distinction between the business and you, the owner. You are entitled to all profits and are responsible for all your business’s debts, losses and liabilities.

You do not have to take any formal action to form a sole proprietorship. As long as you are the only owner, this status automatically comes from your business activities. In fact, you may already own one without knowing it. If you are a freelance writer, for example, you are a sole proprietor. But like all businesses, you need to obtain the necessary licenses and permits. Regulations vary by industry, state, and locality.

In Montana (MT), a sole proprietorship is indeed the simplest business structure and does not require formal registration with the state to be established. As a sole proprietor, the owner is personally responsible for all aspects of the business, including debts and liabilities. The business and the owner are considered a single entity for tax and liability purposes. While no action is required to form a sole proprietorship beyond engaging in business activities, the owner must still comply with all relevant licensing and permit requirements. These requirements vary depending on the type of business, the products or services offered, and the location of the business. It is important for sole proprietors in Montana to check with their local city and county government to ensure they have all necessary local business licenses and permits. Additionally, depending on the business, they may need to register a trade name (also known as a DBA - 'doing business as') with the Montana Secretary of State if they operate under a name other than their legal name.