Ohio Sole Proprietorships
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Persons conducting a social enterprise alone in Ohio without the protections afforded by incorporation are called sole proprietors. A sole proprietorship has no legal existence apart from its owner and may be formed without any expense or formality. Profits and losses are borne directly by the proprietor. The proprietor may operate under a trade name that is registered. In Ohio, a proprietor may register with the Secretary of State the trade name under which he or she operates the sole proprietorship. The Secretary of State charges $50 for registration. Registration may provide limited protection for the proprietorís exclusive use of the trade name.
The following information is required for registration:
- The proprietorís name and business address;
- The trade name to be registered;
- The general nature of the proprietorís business;
- The length of time during which the proprietor used the trade name for business operations in Ohio;
- The signature of the proprietor or his or her authorized representative.
Such registration provides limited protection for exclusive use of the name, absent trademark or service mark registrations.
The main disadvantage of forming a sole proprietorship is that the owner is wholly liable for all debts and obligations of the enterprise. All of the personal assets and assets devoted to the social enterprise can be seized to make payments. A sole proprietorship itself cannot be sold since there is complete unity between the enterprise and its owner, but the assets used in the enterprise can be sold. A sole proprietorship terminates upon the death of its owner.
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