What is a corporation?

A corporation is a separate legal entity that provides limited protection from liability. A corporation can be owned by one person or a group of people. When you structure a corporation, there are two types to choose from: a C-Corporation and an S-Corporation. The differences between the two involve tax issues and shareholder restrictions. There are state laws that govern the formation of a corporation. In general, to establish a corporation, you will need to prepare Articles of Incorporation and Bylaws and issue stock. As a corporation, there are business formalities that you will need to follow such as board of director and shareholder meetings.