​

C CORPORATION

• Advantages of owning a C Corporation

   

  A C Corporation is any business where the owners of the business are taxed apart from the business itself unlike the S Corporation, which is usually not taxed separately. C Corporations are the most common form of business formed under the United Stated for federal income tax purposes. This allows the owners of the business to have less accountability in the instance that an issue between the partners, taxes or otherwise were to arrive. The corporation is taxed based on its profits and shareholders are also taxed based on distributions they receive directly, also known as dividents or profit sharing disbursements. A C Corporation can eventually go public if it becomes successful enough, which will allow it to sell shares to the public or remain privately held and not sell shares to the public. Owners personal assets are protected from the business. It is easier to raise rapital through selling stocks and bonds for small business owners of a C Corporation.

• Disadvantages of owning a C Corporation

   

  Opening a C Corporation could cost up to thousands of dollars due to fees associated with making it a formal C Corporation that must be paid by the owners. Articles of incorporation are what require fees as they detail the business’ details like address, who is in charge in addition to other fees paid to the governement and attorneys when filing takes place. Often C Corporations are double taxed because the Corporation itself is taxed in addition to the business owners being taxed based on the dividends they are paid out personally. There is also more government oversight for C Corporations because of the intricate tax rules and the protection business owners receive by owning a C Corporation. This is what requires the small business owners to report directly to the state in which they are incorporated and where they conduct business. Board, shareholder meetings and issuance of stocks are required by C Corporations.

• Forming a C Corporation

   

  C Corporations are traditionally filed with the state as mentioned above, although some states require additional filings than others. All C Corporations may have different structure and subject to filing certain different articles than others.

​