Are sole proprietors personally liable for business debts?

The short answer to this question is – Yes. As mentioned above, for tax purposes, a sole proprietorship is not viewed as being separate and detached from its owner. From a legal standpoint, the result is the same. Therefore, any and all liability arising out of business relationships will fall directly on YOU. That includes liability arising from any business debts, or any court orders or judgments. Thus, your personal assets, such as your home, or your cars, might be a target for creditors seeking to satisfy the debts arising out of the business, if they are not paid directly.

The Spring business attorneys at Garg & Associates will meet and consult with each client individually, discuss their business strategies, and arrive at a solution that best suits their needs. If you need a skilled business attorney, you owe it to yourself and to your business to consult with attorneys who have your best interests as their top priority. The Garg & Associates attorneys proudly serve all of North Houston and are simple a phone call away.

Please contact our office to see how we can assist you. Learn more about our Areas of Practice.