I'm getting to the point that I will need a business license soon and I was thinking of forming a Sole Proprietorship for my business but I'm not fully sure if I should form a Sole Proprietorship or an LLC. Apparently you can't incorporate a Sole Proprietorship into an LLC: you must pick one or the other! Which one should I get? My situation I'm in the USA in the state of Virginia. I am not married and have no kids. I may marry someday but plan on never having kids (I hate kids). I live in an apartment and have no outside investments past my business stuff. Currently most of my business' money is made selling digital items on Ebay, but I do make some in cryptocurrency as well. Laws out here see cryptocurrency as "personal property" for tax purposes so (as I understand it anyway) it's sort of like reselling antiques in the eyes of the law. My profit margin on sales is usually 25-30%. I keep track of general sales and losses in a spreadsheet done up in chunks like in the example below. Example of how I keep records: Net profit: 17.95 Current Spent: 57.55 Gross earnings: 75.50 12/19/2014 | Coinbase | -50 | bought BTC 12/20/2014 | Ebay | +75.50 | daily sales 12/20/2014 | Ebay | -7.55 | Ebay fees General goals I'd like to hire on family members to help with order fulfilment, but I'm not sure I'll need the help any time soon. I plan on expanding the cryptocurrency side greatly in the coming year. I know I won't need help with the cryptocurrency things. I'm currently planning on putting 30% of profit away for taxes, 50% back into the business, and will take no more than 20% for myself. Things On My Mind I know LLCs can do nifty tricks like paying myself in order to be taxed based on my "income" or an LLC can give some protection if I ever get sued, however, they are a lot more expensive all around. They cost more to start, cost more to file taxes, cost more in tax rates, and are more time-consuming to both start and run due to requiring a lot more detailed paperwork and a lot more red tape. Chances are my record keeping is not detailed enough for an LLC. I know that Sole Proprietorships don't have as many tax-lowering tricks and I won't be able to write off investments in the company like with an LLC (Or can I? It was unclear!), but a Sole Proprietorship is a lot simpler to run with less detail required in everything. Should things go wrong or I decide to do something else, it's much easier to end a Sole Proprietorship than an LLC as well. So, what do you think, guys? Which one should I go with?