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How Do I?
Office of the Mayor
Office Of Economic Development
Maui County Business Resource Center
Starting A Business
Advantages of a Sole Proprietorship
Easiest and least expensive form of ownership to organize
Sole proprietors are in complete control, and within the parameters of the law, may make decisions as they see fit.
Sole proprietors receive all income generated by the business to keep or reinvest
Profits from the business flow-through directly to the owner's personal tax return
The business is easy to dissolve, if desired
Business registration with the State of Hawaii Department of Commerce & Consumer Affairs is not required, unless public notice of trade name is desired.
Disadvantages of Sole Proprietorship
Sole proprietors have unlimited liability and are legally responsible for all debts against the business; Their business and personal assets are at risk.
May be at a disadvantage in raising funds and are often limited to using funds from personal savings or consumer loans
May have a hard time attracting high-caliber employees, or those that are motivated by the opportunity to own a part of the business
Legal life ends with owner’s death Owner’s salary cannot be treated as expense; hence, not tax deductible
Subchapter S Corporation
Limited Liability Partnership (LLP)
Limited Liability Company (LLC)
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