Question: Can a sole proprietor have more than one business?
Answer: Yes. Next question.
Easy peasy.
Seriously, as a sole proprietor, you may have one (1) business or several businesses. There is no limit to the number of businesses in which you may engage.
The Internal Revenue Service says you must report your income and your expenses from any endeavor entered into with a profit motive. That can be one or a dozen or even more.
When reporting your business on a Schedule C, you must enter a Business Code. Therefore, if each of your businesses is in a field unrelated to the other–say, if you own/operate the following: Fine Leather Shoe Shop, K-9 Kennels: Prime Pups, AAA Accounting–you will need a separate Schedule C to report each business.
Then, all Schedule C’s will be totaled together and the final number will be carried to the front of the Form 1040.
See? It really was easy.
Helpful links for sole proprietors:
- Checklists for starting your first business
- Simplified accounting for side businesses
- Simplified business plans for the real world
- Simplify your small business marketing plan
- About the Author
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Glenna Mae Hendricks. She is an entrepreneur and income tax consultant, so we get lots of good tax tips from her. She is an oenophile (“look that up in your Funk and Wagnall’s,” she says), and a wine enjoyment teacher/guide who also writes wine notes at the Allen’s Retail Liquors site. Her political thoughts (and occasional outbursts of domesticity) appear at Old Feminist and Wild-eyed Liberal.
omg- i’ve been looking to the answer to this question for days. thank you!
Walter shared this question by email:
“Thank you for the answer, as a follow up question, If I have an EIN for one business that I run/operate as a sole prop, can I request and obtain another EIN for a second or third business that will also be run/operate as a sole prop? if they are unrelated to each other?”
The answer we received was that you can have multiple EINs for multiple unrelated businesses. All the EINs will be associated to your social security number.