What is the primary advantage of forming a partnership over a sole proprietorship?

The primary advantage of forming a partnership over a sole proprietorship is shared financial responsibility. In a partnership, the financial burdens, risks, and responsibilities are distributed among the partners, which can alleviate the pressure on any single individual. This shared approach allows for a pooling of resources and capital, which can enhance the financial stability of the business.

Additionally, partnerships can benefit from diverse skills and expertise brought by each partner, which can lead to more informed decision-making and innovative problem-solving. This collaborative nature can often make it easier to navigate the challenges of running a business compared to a sole proprietorship, where all responsibilities rest solely on one individual.

In contrast, while options like easy tax setup, simplicity of formation, and liability protection may offer some benefits, they do not directly emphasize the advantage of shared financial responsibility that partnerships uniquely provide.