Business Organization as a Corporation
A corporation is a legal entity owned by shareholders. It can enter contracts, own assets, pay taxes, and borrow money. Corporations have a complex structure with different management levels and departments to efficiently coordinate various functions. They are owned by shareholders who hold ownership shares.
Corporations are separate legal entities from proprietors or shareholders, providing limited liability protection. Shareholders’ personal assets are usually protected from company debts and liabilities. Corporations possess many legal rights and responsibilities like individuals. They can hire employees, loan and borrow money, sue and be sued, and pay taxes.
Most large companies like Microsoft and Coca-Cola are corporations. A corporation can be dissolved when relationships prevent operation. There are modified corporate forms like Limited Liability Companies and S corporations. The business structure affects taxes, money raising, paperwork and liability.
Business as a Corporation
A corporation is a type of business that the law treats like a single person. This means a corporation can do things like buy a car, sign a deal with a supplier, or borrow money to rent office space. While a corporation is treated as an individual, it can be owned by multiple shareholders. Shareholders are served by an elected board of directors, who oversee officers that handle the day-to-day running of the company.
A corporate business is recognized as a separate legal entity from its proprietors or shareholders. This separation provides limited liability protection to shareholders, meaning their personal assets are usually protected from the corporation’s debts and liabilities. Corporations typically have a complex organizational structure with different levels of management, departments, and divisions. This structure enables efficient coordination and management of various business functions. Corporations are owned by shareholders who hold ownership shares.
The S-Corp and C-Corp tax elections can benefit different types of businesses in different ways. A corporation can choose either tax election based on which structure benefits the company the most. Some states allow businesses to form a Public Benefit Corporation (PBC) which has a bigger purpose than just maximizing profits and practices social-responsibility.