C Corporation NYC
A C corporation or C-corp is a corporation where it is owned by shareholders. These shareholders select a board of directors who have to oversee all the decisions made for the business. A C corporation is an entity, which does not end if the owners die or change when it is transferred. The proprietors are taxed separately from this entity, thus separating the company’s assets from its owners.
If you are unsure whether to form an LLC or not, go through the following lists of the positive and negative aspects of it. It helps you decide what to do during LLC registration.
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- LLC FORMATION
- C CORPORATION
- S CORPORATION
- Easy to invest in: There is no limit to the number of investors for the company compared to others making it easy to invite people to invest.
- A lot of shares: A C corporation can issue as much of shares as they want but if they reach 500 or more than the company must be registered with the SEC
- No set owner: As multiple shareholders own the company, the business does not cease to exist when the first owners leave. Only when the business is wound up or dissolved does the corporation finish.
- Reliability: It is much more reliable to get investments as well as working with the traders and consumers
- Division of Income: There are lower tax rates for both the company and those who own it as the profits and losses are split between the various shareholders and the business.
- Lesser Liabilities: The owners cannot be held responsible for any losses in the business. Also, if any legal actions are being taken, the shareholders will not be held accountable nor will the petitioners be able to come after the personal assets of the shareholders. Thus in turn protecting them
- No restrictions: There are no limitations on who can own stock and who cannot work, unlike other corporations. Foreign nationals can also be shareholders unlike in S Corporations
- Easy to transfer shares: It is free and easy for a shareholder to sell his economic and management rights with the approval of other members.
- Double Taxation: The Corporation is taxed twice. First, at the corporate level where they pay at the corporate income rate. Second, at the personal income rate as the profits and losses of the company are divided and distributed between the shareholders of the business.
- Rules and Regulations: With a C corporation comes along its rules. Unlike S corporations, it is mandatory for C corporations to hold meetings after certain periods have elapsed. The meeting minutes from these also have to be kept recorded in a file.
- Expensive to Run: to start, a business has to pay a fee to incorporate, which can range from $100 to $1000. This fee range depends on the state where it is being formed.
- Government oversight: The government oversees the C corporations more compared to the S corporations as it has intricate laws and due to the limited liability of the owners
- Additional Help: Due to complex federal and state laws, the need for an attorney or an accountant is required.
- Corporate Losses: These losses are to be filed and reported on the shareholders’ tax returns and thus cannot be deducted
- Legal Requirements: Forms must be filled and filed to receive permission if a C corporation in one state wants to do business with another in a different state.
- Dividend Distribution: The corporate’s profit and losses are divided according to the number of shares one holds in a C corporation. Whereas in a partnership, one does receive more than that set amount.
HOW TO FORM A C CORPORATION IN NEW YORK CITY?
- Choose a name for your corporation: Choose a name for your company, which must include “Incorporation” “Incorporated” or “Limited.” Names must be checked with the New York registry to ensure it is different from those already registered.
- File Certificate of Incorporation: This certificate is to be filled out with the name of the company, the name of the country where it’s mainly based in and the name and address of the person who will be receiving the copy of the services
- Get a registered agent: The New York State Department must be named as the agent for the company
- Setting up of a Corporate Records Book: This must be done to keep all files and documents in one place which include the minutes of meetings, stock certificates, and others
- Prepare Corporate Bylaws: A separate document must be made to set down basic ground rules for the corporation
- Appoint Directors: The shareholders must appoint a board of directors to manage the company
- Set a Board Meeting: A meeting must be held for the directors to appoint officers, implement the bylaws and choose a bank for the company
- Issue Stock: This must be done so that each shareholder receives its stock certificate
WHERE ARE WE BASED?
We are located in the state of New York. The area includes the five boroughs of the city of New York, which are Manhattan, Bronx, Brooklyn, Queens and Staten Island.