Many business owners use the sole proprietorship because it is easy to set up, maintain, and take deductions. Unfortunately, this is where the benefits end.

Basically, if you do not choose a business entity then by default you become a sole proprietor and are limited by the number of deductions you can take. In other words, it is the "bottom of the barrell, " for deductions. At least take a look at other entities like the LLC or Corporation. You might find that you have been missing out on some great tax deductions.

Statistically, by using a sole proprietorship you are ten times more likely to be audited by the IRS. Most likely this is because there are so many more sole proprietors than any other business entity.

At the very least you should step back and take a look at your current business structure to make sure you are getting the most benefit from it. Many advisers should be able to give you a good idea of what you might be missing out on.

(Remember, this only discusses the management entity of the business and not asset protection. Other entities should be used in conjunction with your management entity to protect your assets.)

For more information on properly drafted Limited Partnerships see our website at http://www.protectwealth.org/