Corporation (C-Corp) by State
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A C corporation is a separate taxpaying entity, the standard choice for venture-backed startups and companies that will issue stock. The table shows what each state charges to file.
What a C corporation is
A C corporation is a legal entity owned by shareholders, run by a board of directors, and managed day to day by officers. It is taxed on its own profit at the corporate rate, and shareholders are taxed again when they receive dividends. In return, it offers the ownership structure investors expect: multiple share classes, stock options, and easy transfer of shares.
Who it suits
- Startups planning to raise venture capital or angel funding
- Companies that will grant stock options to employees
- Businesses planning an acquisition or public offering
- Companies with foreign or institutional shareholders
Costs and formalities
Forming a corporation means filing Articles of Incorporation and adopting bylaws, then holding director and shareholder meetings and keeping minutes. Annual reports and, in many states, franchise taxes apply. Expect higher legal and accounting costs than for an LLC.
Taxes at a glance
Federal corporate tax is a flat 21 percent under current law, with a second layer of tax on dividends. Salary paid to owner-employees is deductible to the corporation and taxed to the employee. See LLC vs corporation and C-corp vs S-corp for detail.
Corporation filing fees by state
Filing fees for Articles of Incorporation vary by state. Ongoing fees and franchise taxes are separate, so check the state's filing office for the full cost.
Corporation (C-Corp) fees by state
Frequently asked questions
When should I choose a C corporation over an LLC?
When you plan to raise venture capital, issue preferred stock, or grant stock options broadly.
What is double taxation?
The corporation pays tax on its profit and shareholders pay tax again on dividends.
Where should I incorporate?
Delaware is common for venture-backed companies. Otherwise incorporate in the state where you operate.
Disclaimer: Legal information, not legal advice. Fees change, so confirm with the state filing office. See our full disclaimer.