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C Corporation

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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.

get a Free 20 minute consultation

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

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