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 Utah, a sole proprietorship is indeed the simplest business form and is automatically established when an individual begins business activities on their own. There is no need to register a sole proprietorship with the state, unlike corporations or limited liability companies. However, the owner must comply with licensing and permit requirements which vary depending on the type of business, location, and industry. This may include obtaining a local business license, a sales tax permit, or specific industry-related licenses. The owner of a sole proprietorship is personally liable for all debts and obligations of the business, meaning personal assets can be at risk if the business incurs debt or is sued. It's important for sole proprietors in Utah to maintain proper records and consider obtaining insurance to protect against business liabilities.