A Pennsylvania corporation properly formed pursuant to Pennsylvania law provides its shareholders protection from personal liability and, therefore, is referred to as a limited liability entity.
A business owner may elect to form a “C” Corporation under Subchapter “C” of the Internal Revenue Code and corresponding Pennsylvania law, which provides for unlimited growth potential and is less limiting than an “S” Corporation.
- Has no limitations on the number of type of shareholders. A shareholder may be an entity or non-resident aliens.
- May take special qualifying deductions.
- Has unlimited growth potential through the sale of stocks.
- Is taxed as a separate entity and most report profits and losses on an annual corporate return.
- Pays taxes on the profits of the Corporation while individual shareholders pay taxes on what he/she is paid from the Corporation.