What are some of the differences between entity forms?What is a C Corporation?
The term C Corporation refers to the way in which the corporation is taxed. There is a corporate level income tax on the profits of a C Corporation. In addition, if a dividend is paid to shareholders from retained earnings, the dividend is included on the personal tax return of each shareholder. Thus, the profits of a C Corporation are subject to potential double taxation. Your corporation will be taxed as a C Corporation unless IRS Form 2553 to elect tax treatment as an S corporation is filed in a timely manner.
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