A legal form of business entity that may have an unlimited number of shareholders, which may include shareholders who are foreign citizens. Shareholders are protected from the corporation's liabilities. "Double taxation" frequently occurs, because the corporation is taxed on its profits, and shareholders are also taxed on the distributions they receive, such as profit sharing payments or dividends. While public C-Corporations have far more stringent reporting requirements than privately held corporations, both must have annual shareholder meetings and minutes of those meetings must be recorded
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C-Corp Filing Service
The most common type of corporation is the C-Corporation, which is a for-profit, state-incorporated business. Articles of Incorporation are filed and appropriate fees are paid to set it up. The C-Corporation is established as a unique business entity, which takes on a distinctly separate business and tax identity from that of the owners (the shareholders). Separate income taxes are filed (IRS form 1120), and corporate taxes are paid regularly for the business. In return, the business owners are removed from personal liability for debt incurred by the corporation. To establish a corporation, several requirements and formalities must be addressed. For example, a corporation must issue shares to stockholders. In addition, state requirements usually include minutes be taken at shareholder and Board of Director meetings, officer appointments, and specific records maintained, as outlined by the state in which the incorporation documents are filed.
As you can see, this requires expertise to setup which is why we depend so heavily on our partners. C-Corporations are the most common and are monitored extensively to assure compliance. Our legal team is well versed in the process so that there are no questions about what is necessary to properly setup the C-Corporation.
Advantages of the C-Corporation is a separate legal entity, and if it is adequately capitalized and proper corporate formalities are followed, the shareholders should have liability protection from its debts and obligations. Corporations can utilize corporate benefit health plans, which often offer better retirement options and benefits than those offered by noncorporate plans.
A regular corporation (also known as a C-Corporation) is taxed as a separate entity. Income earned by a corporation is normally taxed at the corporate level using the corporate income tax rates shown in the table below, and the corporation must file a Form 1120 each year to report this income. After the corporate income tax is paid on the business income, any distributions made to stockholders are taxed again at the stockholders' tax rates as dividends.