Why choose a C corporation? When registering a company, C corporation is most common, but it isn’t always the top choice for small business owners. C corporations provide limited liability protection to owners, who are called shareholders, meaning owners are typically not personally responsible for business debts and liabilities. C corporations may also offer greater tax advantages because of an expanded ability to deduct employee benefits, which are most often used by growing businesses.

Key Benefits C corporations are more flexible than S corporations in terms of the number of owners (shareholders) they can have and who can be an owner. That is one reason why C corporations are the business type of choice for venture capitalists when they provide funding to a business.

Keep in Mind Corporations face the most extensive ongoing formalities of any business type. Corporations must adopt and regularly update bylaws, hold and properly document annual meetings of directors and shareholders and more.