Description of corporations. Incorporate Delaware in 24 hours

Before deciding which type of corporation best suits your business needs, always consult with your legal or financial advisors. Global Corporate Services, Inc. is a registered agent in the State of Delaware and does not offer legal or tax advice. We are here to help you start your new business as quickly and cost effectively as possible.

For more detailed information, please be sure to speak with a qualified legal and/or financial advisor. You may address your questions to our Tax and Accounting Services at tax@delawarecorp.us.

General "C" Corporation

The general corporation is the most common corporate structure. This type of corporation is a separate legal entity that is owned by stockholders. A general corporation may have an unlimited number of stockholders that, due to the separate legal nature of the corporation, are protected from the creditors of the business. A stockholder's personal liability is usually limited to the amount of investment in the corporation and no more.

Sub-Chapter "S" Corporation

With a sub-chapter "S" corporation you can deduct the profits and losses from your corporation on your personal tax return. You will no longer be considered a "C" Corporation. Prior to March 15 you must file an IRS Form 1120-S. To qualify as a "S" corporation, you must be a US citizen or qualified resident filing a personal tax return with the IRS.

Close Corporation

There are a few minor, but significant, differences between general corporations and close corporations. In most states where they are recognized, close corporations are limited to 30 to 50 stockholders. In addition, many close corporation statutes require that the directors of a close corporation must first offer the shares to existing stockholders before selling to new shareholders.

This type of corporation is particularly well suited for a group of individuals who will own the corporation with some members actively involved in the management and other members only involved on a limited or indirect level.

Non Profit Corporation

Non-Profit Corporations are formed for charitable, scientific, religious or educational purposes, etc. If the corporation is to qualify for tax exempt status by donations then it has to qualify with the IRS. Sometimes they are referred to as 501(c)(3) corporations. Without the IRS qualification any donated funds will not be considered a tax free exemption.

Shelf Corporation

A shelf corporation is a company that has been in existence or a period of time.