Forms and Fees for Registering a Sole Proprietorship in Mississippi

By Jeff Franco J.D./M.A./M.B.A.

Starting a sole proprietorship in Mississippi is an easy way to get your business operations underway since it isn’t necessary for you to register with the Secretary of State’s office. However, there are additional Mississippi government agencies that require the filing of other forms and the payment of fees by sole proprietors.

Forming a Mississippi Sole Proprietorship

In Mississippi, as in all other states, sole proprietorships are not recognized as entities that are separate and distinct from their owners like corporations and limited liability companies. However, despite the fact that your business isn’t subject to the same registration requirements as other business entities, a significant disadvantage to operating a sole proprietorship is that you’re personally liable for all debts and obligations you incur through your business. This means that everything you own, such as your house and personal bank accounts, are vulnerable to business creditors and any lawsuit judgments resulting from your business activities.

Doing Business As

It is very common for sole proprietors to operate their businesses under a name different than their own. In most states, sole proprietors must register any trade name they use. This is commonly known as “doing business as” or “DBA” for short. However, one advantage you have as a Mississippi sole proprietor is that the state allows you to operate under a DBA name without having to register it with the state – which in other states can require the payment of fees as well as the filing of forms.

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Business Licenses and Permits

One thing you can’t avoid as a sole proprietor in Mississippi is the requirement to obtain a business license or permit if your operations warrant it, such as if you sell alcohol or operate a construction business. Moreover, it also depends on the area of Mississippi in which your business operates, since many licenses and permits are issued by local governments. For example, if you operate a construction business in the city of Starksville, you need to submit an application form and pay a $50 fee to the city each time you want to place a trailer on a construction site. The application form itself isn’t lengthy or complex, but you need to report the location of the construction site, the length of time the trailer will remain there and the utility services it requires.

Mississippi Tax Registration

There are a number of situations when sole proprietors must register with the Mississippi Department of Revenue prior to commencing business operations. If you operate a business that sells tangible goods that are subject to state sales taxes, you must obtain a separate permit for each location where you operate and file periodic returns with the state to remit the sales taxes you collect from customers. If you hire employees who reside within the state, you also need to register for a withholding tax account and periodically remit the income taxes you withhold from your employees’ paychecks. It isn’t necessary to pay any fees when completing your registrations and you can even register for both taxes on a single Form 70-001.

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How to Set Up a New Sole Proprietorship in Indiana

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What Do You Need to File as a Sole Proprietor?

For entrepreneurs who want to operate a business without a legal entity, they can do so and operate as a sole proprietor. An advantage to operating as a sole proprietor is that you can start your business operations immediately rather than having to go through the process and expense of creating a corporation or a limited liability company. However, sole proprietors are personally liable for all debts and obligations of their business, unlike business entities.

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