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What are the Main Differences between an LLC and an S-Corp?

What Is a C-Corporation?

What Is an LLC?

What Is an S-Corp?

Which Type of Company Incorporation is Right for You?

 

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What Is A C-Corporation?

The business owner has a range of choices when it comes to legal structure. An individual, such as a shop owner, contractor or freelancer can create what is called a sole proprietorship. If you go into business with one or more others, you may decide to create a partnership. Should you choose to incorporate, however, you can go one of two ways: You can choose to form an S-corporation or a C-corporation.

So what is a C-corp?
A C-corporation is a structure most common to larger organizations that can also suit smaller ones. C-corp status offers tax and other advantages but also imposes a lot of administrative requirements on the business owner(s). Some states require more of the C-corporation than others. Generally speaking, however, the formulation of by-laws and articles of incorporation, the election of a board of directors, and scheduling and recordkeeping relative to directors' and shareholders' meetings are requirements.

Separate Entity
One thing that distinguishes the C-corporation from the sole proprietorship is that a C-corporation exists separately from its owners. This means that if the company is sued or goes into debt, the assets of the owner(s) will not be vulnerable. Forming a C-corporation can mean the difference between worrying about exposing your personal assets to claims from creditors, or allowing yourself to sleep peacefully at night.

Taxation
To establish that separate identity, a C-corporation is given its own tax identification number by the Internal Revenue Service. On the downside, the profits of a C-corporation are taxed twice: The corporation itself is taxed when its returns are filed. Shareholders who receive dividends are also taxed when they fill out and submit their individual returns. On the upside, C-corporations can deduct the cost of any fringe benefits they provide to employees when the corporate return is filed. This can make offering fringe benefits more affordable. A healthy program of fringe benefits may enable the business to attract more qualified employees.

Stockholder Matters
In addition, a C-corporation can raise capital by selling stock, something a sole proprietorship or partnership cannot do. In some instances, this capability may make it easier to raise financial backing. The administrative structure that accompanies C-corp status can prove to be a negative. Regular shareholder meetings must be held -- once a year at least -- and minutes must be recorded. Each corporation must have its own president, secretary and treasurer. Shareholders must elect a board of directors who are required to meet regularly and vote on major decisions. In some cases, those decisions must also be approved by the shareholders. In other words, a system of checks and balances created with an eye toward accountability must be established.

For business owners accustomed to making decisions regarding the direction of the company on the fly, this structure can seem cumbersome, if not counterproductive. Owners and employees alike may bemoan such changes, looking with nostalgia upon the days when the business was "smaller and more personal."

By-Laws and Articles
A C-corporation must file articles of incorporation with the state secretary of state's office. It must also create and record a set of by-laws. Very often, these administrative requirements require the services of one or more lawyers which can prove costly.

C-corp status offers definite positives, but its administrative requirements can prove deleterious to the entrepreneurial spirit.

Charlottesville: Blame the Incorporation Doctrine

There was plenty of blame and finger-pointing in the aftermath of the Charlottesville protests. One woman died and at least 33 people suffered injuries when right-wing and left-wing groups clashed during the Unite the Right Rally. Two state troopers also ...

Published:  Fri, 22 Sep 2017 10:30:00 GMT



Salt Spring looks to heal after rejecting incorporation

Salt Spring Island is a community divided as a result of Saturday's vote against incorporation, but it is resilient and will heal, according to one of the organizers of the campaign against the new form of governance. Patricia Lockie of Positively No ...

Published:  Sun, 10 Sep 2017 16:12:00 GMT



City, Town lock horns over incorporation

BELOIT - Beloit City Manager Lori Curtis Luther is standing by her news release offering annexation options to Town of Beloit residents despite town Administrator Ian Haas calling the release "unfortunate, misleading and incorrect." Luther released a ...

Published:  Wed, 13 Sep 2017 14:00:00 GMT



Edison: approved the project for merger by incorporation of Edison Trading

EDISON: APPROVED THE PROJECT FOR MERGER BY INCORPORATION OF EDISON TRADING. Milan, September 21, 2017 - Edison announces that the minutes of Edison's Board of Directors meeting held on September 20, 2017, which approved, pursuant to art. 2505 - second ...

Published:  Thu, 21 Sep 2017 09:53:00 GMT



West-side town of Beloit residents hear update on east-side incorporation

TOWN OF BELOIT-Residents on the town of Beloit's west side gathered in the Turner High School auditorium Wednesday night to gather details about the east side's efforts to incorporate. The meeting revealed little new information about the ongoing ...

Published:  Thu, 14 Sep 2017 04:34:00 GMT



The First Steps To Register A Company In Singapore

Enact A Secretary Your company needs to have a secretary. This secretary needs to be appointed, by law, within 6 months of incorporation. However, it's a good idea to enact a secretary as soon as possible so that they can alleviate some of the things ...

Published:  Sat, 23 Sep 2017 05:43:00 GMT



Heart of the Valley: City incorporation and Whiskey Row

Almost 122 years ago, Santa Marians went to the polls to vote either for or against the incorporation of the town. It was a hot subject because, if the town incorporated, Whiskey Row was sure to be history. The "wets" wanted things to stay the same ...

Published:  Sun, 10 Sep 2017 00:13:00 GMT



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