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There is a high degree of danger involved in running a small company. The easiest approach to protect yourself from personal liability is to form a corporation. As a result, you will be shielded from personal responsibility for the company's debts because the company and you are now two distinct legal entities. The company will be responsible for paying off its own obligations. For privacy reasons, incorporation is also helpful.
Issuance of share is possible for corporations which can create quick capital
After incorporation the legal status of companies increases which will gain you credibility
Corporations survive even after the death of the owners
In a limited liability company (LLC), the owners are protected from personal responsibility for the business' debts. Many experts consider it to be the best corporate structures for medium- to small-sized enterprises. The formation and ongoing maintenance costs of an LLC are often lower than those of other organizational arrangements.
By filing Form S-Corporation with the Internal Revenue Service, a company can elect to be taxed in pass-through form (IRS). Companies in this category are eligible for corporate-level income, losses, and deductions. When it comes time to sell your business or wind it down, a S corporation can be helpful too.
When it comes to taxes, a C corporation's owners and the entity itself are considered to be two independent entities. The profits of a C corporation are subject to taxes at both the corporate and individual levels, which results in a situation where the gains are taxed twice.
Organizations that are not for profit do not have the goal of making a profit. It is different from an LLC, S-Corp, or C-Corp in that the profits of the business are distributed among the employees. The investors are not compensated in any way.
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