Why Choose a C Corporation?

C corporations provide limited liability protection to owners, who are called shareholders, meaning owners are typically not personally responsible for business debts and liabilities. C corporations may also offer greater tax advantages because of an expanded ability to deduct employee benefits, which are most often used by growing businesses.

C corp advantages

C corporations typically provide a number of advantages:

  • Limited liability protection. Owners are not typically responsible for business debts and liabilities.
  • Unlimited owners. C corps can have an unlimited number of shareholders.
  • Easy transfer of ownership. Ownership is easily transferable through the sale of stock.
  • Unlimited life. When a corporation’s owner incurs a disabling illness or dies, the corporation does not cease to exist.
  • Raise capital more easily. Additional capital can be raised by selling shares of stock.
  • Credibility. Corporations may be perceived as a more professional/legitimate entity than a sole proprietorship or general partnership.
  • Lower audit risk. Generally C corporations are audited less frequently than sole proprietorships.
  • Tax deductible expenses. Business expenses may be tax-deductible.
  • Self-employment tax savings. A C corporation can offer self-employment tax savings, since owners who work for the business are classified as employees.