GET LISTED | LOGIN | SIGNUP
 
Welcome to FindMyBest CPA
 
Accounting & Financial Directory
 
Find local and nationwide accounting and financial businesses. We have located the best Accountants, CPAs, Accounting Firms, Tax Consultants, Tax Return Preparers, Bookkeepers and Financial Advisors in the US.
 
Business Directory
 
Tax & Accounting Articles - Business Entity Types
 
 
 
CPA's Find New Clients Today
 
FindMyBestCPA Search
User Details
Reviews and Comments
 
Search top city
Atlanta Accountants
------------------------------------------------------
Boston Accountants
------------------------------------------------------
Chicago Accountants
------------------------------------------------------
Dallas Accountants
------------------------------------------------------
Detroit Accountants
------------------------------------------------------
Huston Accountants
------------------------------------------------------
Los Angeles Accountants
------------------------------------------------------
Miami Accountants
------------------------------------------------------
New York Accountants
------------------------------------------------------
Philadelphia Accountants
------------------------------------------------------
San Francisco Accountants
------------------------------------------------------
Washington Accountants
 
List of General Articles
 
Fortune 500 Company List
 
Accounting and Terminology
Accounting Tools
Other Types of Accounting
Governing Bodies and Regulations
Public Accounting
Cost Accounting
Financial Statements
IRS Tax Forms
Other Taxes
Business Entity Types
 
Tax & Accounting Sub Category Articles
CPA's Find New Clients For Your Firm
Accounting Information > Business Entity Types > C Corporation
C Corporation

There are many possible business entities from which you can pick to conduct your trade or business. These include sole proprietorships, general partnerships, limited partnerships, C corporations, S corporations, and limited liability companies. You must evaluate the good and bad points of each and consider how it would work with your organization and any other parties involved.. Some forms of doing business offer limited liability protection for the business owner while others don‘t, and some are only available as options if certain conditions are met.

 

A C corporation is a standard corporation. It is a taxpaying entity which is separate from its owners, meaning it is its own legal entity. To form a C corporation, the business must be incorporated in some state. The corporation does not need to be incorporated in the state in which the business is operating. Due to favorable corporate taxation laws, many businesses choose to incorporate in Delaware or Nevada. The law of the state in which the business operates may still have a requirement that the business make some sort of formal notification that it is conducting business in the state. Also, the corporation would most likely be liable for state income tax for income earned in that state.

The C corporation is required to file Form 1120, U.S. Corporation Income Tax Return to report its income or loss. If the corporation has gross receipts of less than $500,000, it would file Form 1120-A, U.S. Corporation Short-Form Income Tax Return. Any distributions made by the corporation to the shareholders are treated as personal items of the shareholders. If the shareholder receives a salary from the corporation, the salary is deducted as an expense on the corporation’s tax return, and the shareholder reports the salary as income on their income tax return.

A C corporation is subject to what is referred to as double taxation in the case of dividends to shareholders. When the corporation distributes a dividend to the shareholders, the shareholder reports it as income on their tax return. The corporation is not allowed to take a deduction for the dividend distribution. This means that the earnings of the corporation are taxed to the corporation, and when they distribute a portion of the earnings to the shareholders, they are taxed again.

When deciding on the type of business entity to use for your business, you should consider your estimated income or loss for when the business is getting started. If you anticipate a loss for the first year or two, you should consider a pass-through entity rather than a C corporation. A pass-through entity will pass the loss through to the individuals to claim on their tax returns. A C corporation would not have this benefit.

Are you looking for someone to help you with your income taxes, accounting, financial reporting, business start-up, auditing, tax accounting, or bookkeeping needs? You have come to the right place! Try the CPA search feature on this website to find a qualified professional in your area to help you with all your tax and accounting needs.

 
 
 
 
 
 
© Copyrights 2007, All Rights Reserved. FindMyBestCPA.com
Home     AboutUs     CPA Directory     List Your Firm     Links     Privacy     Contact Us