C Corporation

C Corporations have been the most common form of doing business, epically big business, and companies seeking public financing. The benefits include limited liability for shareholders, a structure created for raising large amounts sums of capital, and the ability to take advantage of special tax strategies in areas including group insurance (life and health), pension/profit-sharing plans and many others fringe benefits.

Taxes:

C Corporation are taxed at the corporate level. This means all income passed on to shareholders has already been taxes as profit. Creating a situation of double taxation for shareholders/owners.

Note: amounts paid to directors, officers, and employees as salaries and bonuses are generally deductible pre-tax expenses.

Recommended in situations

• Where shareholders and officers / employees are not the same parties.
• Where the business plans to raise large amount of money from unrelated sources.

Not recommended for the following situations:

• Where entity management and maintenance expenses are a concern
• Where another entity type will meet your asset protection, tax minimization needs.

Book a consultation with an attorney to discuss your entity requirements and solutions.

C-Corp requirements

• Use your corporate name on all legal documents
• Annual tax filing – IRS form 1120S
• Record annual minutes
• Must maintain “Corporate veil”
• Separate accounts (everything)
• Bookkeeping