What is a corporation?
A corporation is a legal entity established by individual(s) under the laws of a state to conduct particular types of business or transactions. The corporation exists separately from its shareholders, directors and employees. A corporation is a ‘person’ in the eyes of the law. A corporation functions in the same manner as a person and has the same rights and responsibilities as a person. The corporation may make contracts, assume liabilities, sue and be sued. The corporation and its shareholders and directors have specific duties and obligations to each other.
A corporation is business ownership structure authorized by state law that allows a business to organize as a separate legal entity from its owners. Like an individual, it can carry on business (or other activities), can sue or be sued, and (unless it is non-profit) can issue shares of stock to raise funds with which to start a business or increase its capital. A major benefit of a corporation is that it limits the personal liability of the owners for claims against the corporation, unless they commit fraud.
