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Trading and Investment Terms

C Corporation

A C-corporation (or C-corp) can be defined as a legal structure for an organization in which the owners, or investors, are taxed independently from the entity.

C corporations, the most common of organizations, are likewise subject to corporate income taxation.

The taxing of benefits from the organization is at both corporate as well as personal levels, making a twofold taxation circumstance.

C corporations can be contrasted with S corporations as well as Limited Liability Companies (LLCs), among others, which likewise separate an organization's assets from its proprietors, but with different law structures and tax treatment.

Enterprises pay corporate taxes on profit before circulating residual amounts to the investors as dividend payments.

Individual investors are then subject to individual personal income taxes on the dividend payments they get.

Albeit twofold tax assessment is an unfavorable result, the capacity to reinvest profits in the organization at a lower corporate tax rate is an advantage.

It is necessary for a C corporation to hold at least one gathering each year for investors as well as directors.

Minutes must be kept up to show transparency in business operations.

A C-corporation must keep voting records of the organization's executives and a list of the proprietor's names and possession percentages.

Further, the business must have organization ordinances on the basis of the primary business location.

C corporations will file yearly reports, financial disclosure reports, as well as financial statements.

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