The Florida business formation attorneys at KALIS, KLEIMAN & WOLFE help clients with the many aspects of forming a business including which entity is the best choice for the individual business, whether it is forming a C corporation verses an S corporation, or converting from a C corporation to an S corporation or vice versa. And, should the corporation stay private or go public with an initial public offering (IPO), etc.
A Subchapter C Corporation (C Corporation or C Corp) is an independent legal entity owned by shareholders and overseen by an appointed board of directors. A C Corporation is financed by its shareholders and/or outside investors, and has the potential to be a publicly traded company. Corporations are held legally liable for the actions and debts the business incurs, not its shareholders. C Corps are often established, larger companies with many employees.
One of the advantages of forming a C Corporation are that shareholders have limited liability for business debts and actions of the corporation. Shareholders are impacted only by the amount of investment in stock they have made into the company. C Corps also have the ability to raise capital through the sale of stock (common stock and preferred stock). C Corps file their taxes separately from their owners. Owners pay taxes on corporate profits paid to them (salaries, bonuses, dividends, etc.). Corporations also are often able to attract and higher high-quality staff due to competitive benefits (offering higher salaries and stock options).
There are also disadvantages to forming a C Corporation. Corporations are often more costly and time consuming to start up and then to operate going forward. Corporations could also face double taxation – once when the company makes a profit and again when dividends are distributed to the shareholders. Also, due to high regulation by local, state, and federal agencies, record keeping and paperwork can be cumbersome.
There are many different ways a business can become a Subchapter C Corporation and the process can be complex. There are also many liabilities, financial risks, and tax implications, which can impact your decision or become potentially costly litigation matters in the future. It is very important to seek the advice of a trusted Florida business formation lawyer to help ensure you make informed decisions that best fits your needs and protects your business interests.
KALIS, KLEIMAN & WOLFE attorneys have more than 80 years of combined experience in helping South Florida businesses. We assist clients in a variety of business formations and help prepare and file necessary documents like articles of incorporation, shareholders agreements, and corporate bylaws. We can assist with taxes, licensing, permits, stock purchases and more. We can also assist with the dissolution or sale of the corporation.
If you need help with starting or managing a Subchapter C Corporation, contact the experienced Corporate Law Attorneys at KALIS, KLEIMAN & WOLFE, P.A., the South Florida-based corporate and commercial litigation law firm today at (954) 791-0477.