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What is a C Corporation?

A C Corporation, often shortened to C Corp, is a type of business entity that's taxed separately from its owners. Its structure provides protection to the company's owners from its debts and liabilities (limited liability), but it also leads to what's known as double taxation: the company pays taxes on profits, and shareholders pay taxes on dividends.

Forming a C Corporation

The process of forming a C Corporation begins with the filing of an Articles of Incorporation document, which legally establishes the company’s existence. This document must include the company’s name, address, purpose, registered agent’s information, and business structure information. Once the Articles of Incorporation are filed with the appropriate state, the process is complete.

Benefits and Disadvantages of a C Corporation


  • Protection from personal liability
  • Flexibility in taxation
  • Unrestricted ownership
  • Potential for growth
  • Increased credibility in the marketplace


  • Double taxation
  • Complicated filing process
  • Larger compliance costs
  • Restricted financial benefits


C Corporations offer numerous advantages to larger businesses, including liability protection and increased flexibility in taxation. While it is a more complex business structure, and may come with higher costs, it can be the right choice for companies that are looking to grow in the long-term.

Frequently Asked Questions

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