A creditor of a sole proprietorship may seek recovery only from business assets of the sole proprietorship,not from personal assets of the sole proprietor.

Question

Quizplus · Accepted Answer

As a sole proprietorship, there is no legal distinction between the business and personal assets of the owner. Therefore, creditors may seek recovery from both the business assets and personal assets of the sole proprietor.

A Creditor of a Sole Proprietorship May Seek Recovery Only