Presentation on theme: "Michael Vanacore, Max Keenan, Alex Green. Corporation- created by a group of shareholders in the business that have ownership in the business. In a C."— Presentation transcript:
Corporation- created by a group of shareholders in the business that have ownership in the business. In a C Corporation, the business is taxed separately from its owners.
1.Limited Liability- for directors, shareholders, and employees 2.Perpetual Existence- shareholders keep business alive even if owner/founder leaves 3.Enhanced Credibility- suppliers and lenders 4.Unlimited Potential Growth- stock is sold with no limit with unlimited amount of shareholders 5.Tax Benefits- taxed separately of corporation, not taxed on income, therefore you can receive employee benefits
1.Cost to set up- costs money to establish business, fees that owner has to pay to establish corporation 2.Double Taxation- income that shareholders get from company is taxed more than once 3.Regulations and Formalities- has to reach standards to be considered ex. Regular board meetings, and shareholder meetings. 4.Record Keeping- record all fees and income to report to IRS 5.Intricate Laws- statutes on the federal and state level
1.Select a name- make sure it is available 2.Select a state- be familiar with its laws for a c corporation 3.Publish a notice of incorporation 4.File articles of incorporation (aka Certificate of Incorporation)- signed by officers
5. Write corporate bylaws- rules and regulations governing corporation, information for shareholders is included 6. Select officers and directors- manages daily activities, the board creates budgets and allocates resources 7. Apply for EIN (Employer Identification Number)- IRS identifies business for taxing purposes
Pay taxes at a corporate level Shareholders pay taxes on dividends received The C-Corp deducts expenses from their revenues and the remaining becomes the taxable income Ex. business brings in $150,000 in revenue and $80,000 is spent on operating expenses. Only the remaining $70,000 is taxable income. This is better than an S-Corp since the shareholders pay taxes regardless
Most big companies are C Corporations Ex. Microsoft, Expedia, Fed Ex, UPS, General Electric, Caterpillar etc…