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A corporation is a business entity created by filing formation documents with the state, a process also known as incorporation.
Just like an LLC, a corporation is a legal entity that is separate from its owners, which can protect you from any business liabilities or debts. However, corporations offer other important benefits, like shareholders and the ability to seek outside investors.
Raise funds by appealing to investors who may prefer corporations for the ability to offer stock.
Attract and keep top talent by offering competitive benefits packages that include shares of your company.
Corporations are often seen as more credible, which can make it easier to do business with other companies.
There are several advantages of forming a corporation. Incorporating offers liability protection, which means that owners of a corporation are generally not personally responsible for business obligations like debts or lawsuits. Incorporation also allows you to add shareholders and raise money from outside investors.
Corporations are typically required to adopt by-laws, hold annual shareholder meetings, issue written corporate resolutions for significant decisions, and file annual reports. Our service allows you to efficiently form your corporation the right way. We also have packages with essential documents and services to meet these corporation requirements and keep you in compliance.
S corporation and C corporation designations are both valid choices when incorporating a business—and whichever you choose, we can help make it happen. Before you make your decision, make sure you understand the pros and cons of each.
Shareholders only pay taxes on profits received. Income gets passed through to the owners instead of being taxed at the corporate and shareholder level, so you avoid double taxation.
The maximum number of shareholders is 100, and they all must be U.S. citizens or residents.
S corporation owners can only get common stock, which comes with voting rights.
Income is taxed twice—the business pays taxes on its net income, and then the shareholders also pay taxes on the profits they receive.
There are no limits on who and how many people can own shares.
Owners may get preferred stock, which usually comes with no voting rights but priority to dividends before common shareholders.
The catchier and more memorable your business name, the more likely it is that consumers will choose you over your competitors. We include a name check with our formation services and can reserve names for you, if possible in your state.
Most states will require you to appoint a person or entity as a registered agent (also called an agent for service of process or statutory agent). A registered agent agrees to receive lawsuits, subpoenas, and other official documents on behalf of your business. You can appoint us as your registered agent to make things easier for you.
Although requirements differ by state, corporations generally must file articles of incorporation. These constitute the charter and legal framework for the business and may contain key information such as the principal location where business will be conducted. When we file these articles for you, it's typically sent to the Secretary of State.
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