C Corporation
Content
Definition
C Corporation is a legal structure for a corporation in which the owners, or shareholders, are taxed separately from the entity.
Usage and Context
C corporations are common among businesses that plan to go public or seek investors. They offer limited liability protection to their owners.
Frequently asked questions
- What is the legal structure of a C corporation? A C corporation is a business structure where the company is seen as its own legal entity. It is separate from its owners.
- How is C corp taxed? C corps face double taxation. First, the company pays tax on its profits. Then, shareholders pay taxes on dividends they receive.
- Who is the owner of a C corporation? Shareholders own a C corporation. They elect a board of directors to oversee the company’s major decisions and policies.
Benefits
C corporations can sell stock to raise money. They also protect owners` personal assets from business debts.
Conclusion
C corporations suit businesses looking to expand or go public. They offer benefits like raising capital and protecting personal assets.
