A sole proprietorship is the simplest and most common form of business. It’s easy to set up, there are minimal paperwork and fees, and you are in complete control. Let us look at the four steps required to start a sole proprietorship in Pennsylvania ("How to Establish Sole Proprietorship in Pennsylvania").
1. Choose a Business Name
You may use your own given name or use a fictitious business name. For example, if you are Joe Greene, you can do business as Joe Greene, sole proprietor. Alternatively, you can create a fictitious business name like “Mean Greene Landscaping.”
2. File a Fictitious Business Name (Doing Business As)
If Joe uses “Mean Greene Landscaping,” he must register it with the PA Department of State to be sure this name is not being used by another business. There is a $70 fee. Joe must also publish an advertisement in a newspaper and a legal publication.
3. Obtain Licenses, Permits, and Zoning Clearance
No license is required to cut grass. However, if Joe decides to apply pesticides, he will need a commercial pesticide applicator license from the Pennsylvania Department of Agriculture.
4. Obtain an Employer Identification Number (EIN)
There are two reasons to get an EIN. First, if Joe hires employees, he must have an EIN. Second, banks usually require an EIN to open a business bank account. EINs are able to be obtained from the IRS online at no cost.
Once Joe completes these four steps, Mean Greene Landscaping will be in business as a sole proprietor.
Our consultants at the Duquesne University SBDC can walk you through all of the steps to establish a sole proprietorship and start your new business. Contact us for help today!
The Duquesne University SBDC provides free business consulting for entrepreneurs in the Greater Pittsburgh area. Click here to request free consulting, or contact the SBDC for additional help and information.
Don Lodge is a Business Consultant at the Duquesne University Small Business Development Center (DUSBDC). He is also a certified business coach who has worked with over 100 small business clients since 2002. His areas of expertise include profitability improvement, effective sales techniques, and employee relations.