Corporation Definition – What is Corporation?

Corporation definition. Analyzing the definition of key term often provides more insight about concepts. Corporation can be defined as: Business that is a separate legal entity under state or federal laws with owners called shareholders or stockholders. A corporation basically has some rights generally only given to humans like the right to own property. One of the benefits of this right is that it results in liability protection for the owner, the owner’s personal assets having more protection under a corporation then under a sole proprietorship or general partnership. The downside is that with the right granted to the corporation of ownership comes the responsibility to pay taxes. Corporations are typically taxed at both the corporate level and at the individual level at the point of distribution, at the point of dividend.

 

C Corporation Definition – What is C Corporation?

C corporation definition. Analyzing the definition of key term often provides more insight about concepts. C Corporation can be defined as: Corporation that does not qualify for nor elect to be treated as a proprietorship or partnership for income tax purposes and therefore is subject to income taxes; also called C corp. A C Corporation is the default setting for an organization that incorporates. A C corporation can be contrasted to pass through entities like an S corporation or LLC. A C corporation has liability protect but is subject to double taxation. An S corporation or LLC is designed, in part, to keep the liability protection and eliminate the double taxation.