Why should you work hard for someone else and get paid what that individual wants to pay you rather than work hard for your own business and decide how much of the company’s profits should go into your own pocket?

The answer to the above question is a good reason to become a sole proprietor.

The decision to try to become a sole proprietor seems like a good one in the aftermath of The Great Recession. From 2009 to 2012, the wealthiest one percent of American families received 95 percent of the nation’s income gains, according to the Washington Center for Equitable Growth. The stark truth is that companies haven’t been giving most of their employees significant wage increases for many years and about 90 percent of Americans have become poorer since 2009, reports Oxfam International.

The government doesn’t seem eager to help either. There have been a paucity of jobs programs for a long time and just today the U.S. Senate rejected a plan to increase the minimum wage from $7.25 per hour to $10.10 per hour by the end of 2016. The minimum wage in today’s dollars was $10.86 per hour in 1968, according to an April 30, 2014, report by the Associated Press.

Becoming a sole proprietor can be rewarding, but the following factors should be considered first.

* WHAT KINDS OF LICENSES AND PERMITS YOU NEED:
A Small Business Administration (SBA) online report "Find Business Licenses & Permits" provides information on what businesses from all over the USA, including sole proprietorships, need to do to get local business licenses and permits. The SBA website "Filing & Paying Taxes" contains articles that advise prospective entrepreneurs on their tax obligations.

* TAX CONSIDERATIONS:
Sole proprietors can deduct the cost of their health insurance from their taxable income regardless of whether they’re itemizing deductions, home office expenses if they work at home, and the cost of entertainment, equipment, meals and travel. However, they also have to pay double the self-employment tax that employers and employees pay because they’re both.

* THE DISADVANTAGES OF A SOLE PROPRIETORSHIP:
The New York Times points out in "Advantages and Disadvantages of Sole Proprietorship" that sole proprietors must pay for the damages caused by their employees and investors are reluctant to invest in sole proprietorships. Banks are also reluctant to lend money to sole proprietorships because of "a perceived lack of credibility when it comes to repayment if the business fails," the SBA reports.

* A SUCCESSFUL SOLE PROPRIETOR’S QUALITIES:
Sole proprietors should be self-starters who don’t need employers to tell them when to work and how to get their work done. They should also have the desire, work ethic, and persistence to work way more than eight hours daily and should find businesspeople and mentors to help them. Most importantly, sole proprietors must be willing to take risks even if it means failing or struggling financially until the risk pays off. The SBA's "Is Entrepreneurship For You?" has additional advice.