Different Types of Corporations
C Corp
 Close
Corporation or C-Corp in most states where close corporations
are recognized, they are limited 30 Stock holders. Also
when selling stock, it may have to be first offered
to existing shareholders. This type of corporation is
particularly well suited to the entrepreneur who wants
to be one person corporation, or a small group of individuals
who will all participate in running the business.
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General Corporation
This structure is most suitable to
the corporation, which plans to have more than 30 shareholders
and which plans to make large public stock offerings. |
Non-Profit Corporation
The non-profit corporation is best
suited for businesses, which plan to engage in charitable,
religious, educational, or scientific activities deemed socially
beneficial. Net-income of non-profit corporations must be
applied to the attainment of the not-for-profit purpose and
not to enrich the individual members, offers or directors.
Most non-profit corporation achieve 501 (c) (3) status, or
tax exempt status, by filling the Application for Recognition
of Exemption with the IRS. |
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S
Corporation
 Many
business owners find the S Corporation especially attractive
in that all earnings or losses are passed through directly
to their personal income tax return. As a result, it avoids
the double taxation feature of general business and close
corporations. Certain requirements must be met before qualifying
for S corporation status, and we recommended that you consult
with your tax advisor before electing S Corporation status.
To obtain the special S corporation tax status, the corporation
must have all shareholders sign IRS form 2553 and this form
must be filed with the IRS 75 days of the date of incorporation.
CHS can assist you with these filings. |
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Limited
Liability Company
 This
type of business entity has recently emerged as a superior
alternative to corporations and partnerships. The Limited
Liability Company (LLC) combines the best features of corporations
and partnerships: the corporate advantage of limited personal
liability and the taxation advantage of partnerships. The
LLC is now recognized in most states and is to traditional
forms of business. For information and costs for setting up
and LLC in Delaware please contact us at |
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