CorpCo - Corporations & Companies, Inc.: Incorporating Services Made Easy in Delaware and Nevada

The most common choices for incorporating are General ("C") Corporation, Close Corporation and LLC. Sub Chapter “S” is a popular choice for choosing how a corporation will be taxed, and is something that is applied for AFTER a corporation is formed.

General ("C") Corporation

A general corporation provides the greatest flexibility. When initially filed, there are no restrictions on ownership and the corporation may have unlimited shareholders. This is the most popular type of filing for companies which plan to have more than 30 stockholders and/or plan to offer public stock offerings. A General Corporation is always filed as a "C" corporation initially. If you would like to change your tax status to Sub Chapter "S, the 2553 form must be filed with the IRS. CorpCo can partially prepare this form for you, for a $25 service fee. The form will then be sent to you for your signature and your forwarding on to the IRS for processing. NOTE: Some States also recognize Sub Chapter "S" filings at the State level as well. Please contact your State Department of Revenue/Taxation for State requirements, which differ. We do not handle the filing of any S Election forms.

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Close Corporation

A "close" or "closely held" corporation provides restrictions on ownership of the company and offers greater control to the shareholders. Close corporations are normally limited to 30 shareholders or less, and provide "first right of refusal" with regard to the sale of stock. (ie. If someone chooses to sell their stock, they must first offer it back to the other shareholders in the corporation, before going out side of the corporation to sell the shares.) Close corporations cannot "go public" or sell their stock on the New York Stock Exchange.

A Close Corporation is always filed as a "C" corporation initially. If you would like to change your tax status to Sub Chapter "S, the 2553 form must be filed with the IRS. CorpCo can prepare this form for you, for a $25 service fee. The form will then be sent to you for your signature and your forwarding on to the IRS for processing. NOTE: Some States also recognize Sub Chapter "S" filings at the State level as well. Please contact your State Department of Revenue/Taxation for State requirements, which differ. We do not handle the filing of any S Election forms.

Sub Chapter “S” corporation

Sub Chapter "S" is nothing more than a standard General or Close corporation that chooses to be taxed differently than standard "C" corporations and avoid the double taxation that "C" corporations are prone to. The Certificate of Incorporation will contain the same articles of incorporation regardless of whether you desire to be taxed as a "C" corporation or an "S" corporation

“S" corporations are taxed similar to the way partnerships are taxed: Taxes are paid at the personal level and "S" corporations are taxed similar to the way partnerships are taxed: Taxes are paid at the personal level and losses can be taken on the personal return. (As opposed to "C" corporations which are taxed at both the Corporate level AND the personal level for any profits earned.)

"S" corporations are more restrictive than "C" corporations. "S" corporations are limited to 75 shareholders or less, all shareholders must be U.S. citizens, and the "S" corporation cannot be "company owned", all shareholders must be individuals.

Be aware! Corporations are always filed as "C" corporations initially. If you would like to change your tax status to Sub Chapter "S, the 2553 form must be filed with the IRS. CorpCo can prepare this form for you, for a $25 service fee. The form will then be sent to you for your signature and your forwarding on to the IRS for processing. NOTE: Some States also recognize Sub Chapter "S" filings at the State level as well. Please contact your State Department of Revenue/Taxation for State requirements, which differ. We do not handle the filing of any S Election forms.
 

Limited Liability Company

LLC's have become very popular in the past few years and offer a combination of advantages. LLC's provide the liability protection of a corporation, along with the tax benefits of a partnership classification. Because there is no stock authorized in an LLC, there are no stock restrictions attached to the ownership, as there are with "S" corporations. Thus, the LLC has greater flexibility than the S Corporation in accommodating various forms of ownership, including trusts, corporations and non-resident aliens.

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