C Corporation

(redirected from C-Corporations)
Also found in: Financial.
A type of business that may be created by a group of professionals wishing to become incorporated
Pros Less troublesome in daily financial management, minimises current net income—as the income is paid to the physicians as compensation—and minimises current tax liability
Cons At time of sale, up to 60% of the proceeds are paid in taxes by the corporation and by the individual shareholder
References in periodicals archive ?
Represents adjustments to reflect the income tax benefit of losses of consolidated C-corporations that under the Company's current equity structure cannot be used against the income of other consolidated subsidiaries of CWGS, LLC.
The comparatively small predicted rise in the long-run growth rate came from the cuts in business taxes, particularly those applying to C-corporations. For present purposes, we focus on business taxes.
Al Traverso, a partner at Sax LLP, discussed the entity structure by which the corporate tax rate changed: C-corporations pay 21 percent whereas S-corporations pay 37 percent.
Business people lately are eager to form or continue as C-corporations in light of lower taxes for these entities under new laws, but accountants said the devil may be in the details, potentially leading to double taxation.<br />The new tax code dropped taxes for C-corps from 35 percent to 21 percent, pleasing firms already with that structure and attracting attention from other companies.
* Marginal tax rate for C-corporations generally falls from 35 percent to 21 percent.
The new tax law has also stirred some rumblings that law firms might want to consider becoming C-corporations in order to benefit from the new, drastically lowered 21-percent corporate tax rate, according to Blais.
Significant proposals, such as lowering the tax rates for S-Corporations, C-Corporations, and strong cost-recovery provisions, will help ensure our tax system is pro-growth to benefit American consumers, manufacturers, and the economy."
The tax shall be calculated at the highest rate of tax attributable to individuals for individuals, S-Corporations, trusts, estates, disregarded entities not owned by C-Corporations, and partnerships; the highest rate of tax attributable to corporations for C-corporations and entities owned by C-corporations; and a zero rate of tax for tax-exempt or nontaxable partners.
Individuals can receive up to $5,000 in state tax credits, a married couple up to $10,000 and C-Corporations up to 75% of their state income tax liability!
They pay a 1.8 percent tax and C-corporations pay a 0.4 percent tax.
C-corporations offer a higher degree of limitation on liability, applicable to directors, officers, shareholders and employees.