Accounting & Tax

C Corporation (C Corp)

A C corporation is a legal business entity structure commonly chosen by startup founders. It provides limited liability protection to shareholders and allows for unlimited growth potential by issuing multiple classes of stock. C corps are subject to corporate taxation, and profits and losses are separate from the owner's personal tax returns.

Arbo Team
Jul 19, 2023

What it is: A C corporation is a legal business entity structure commonly chosen by startup founders, providing limited liability protection to shareholders and allowing for unlimited growth potential through multiple classes of stock.

Why it is essential: C corps separate the personal liability of owners from the corporation's liabilities, protecting shareholders' personal assets. They also facilitate fundraising by issuing different classes of stock to attract investors.

How to use it in startups: By establishing a C corp, startups can enhance their credibility, attract investors, and pursue significant growth opportunities. It is important to adhere to corporate taxation requirements and maintain proper records to benefit from limited liability protection.
Accounting & Tax

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