Entity comparison chart
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FAQs Corporate Library Entity comparison chart
Entity comparison chart
2009.04.09
| C Corporation | S Corporation | Limited Liability | Limited Partnership | |
| Personal liability for business debts | No personal liability of shareholders | No personal liability of shareholders | No personal liability of members | General partner(s) are personally liable; limited |
| Who legally obligates the business? | Officers and directors | Officers and directors | In member managed, any member; in manager managed, any manager | Any general partner, not limited partners |
| Who is responsible for management decisions? | Board of directors, and officers | Board of directors, and officers | Same as above | Same as above |
| Restrictions of Ownership | Most states allow one-shareholder corporations;some require at least two | No more than 75 share-holders allowed; no foreign entities or Individuals or domestic entities allowed | Most all states allow one-member LLC's | At least one general partner and at least one limited partner is required |
| Formation and ongoing formalities | Articles filed with state; bylaws and annual meetings required | Articles are filed with state; form 2553 filed with IRS; bylaws and annual meetings required | Articles are filed with state;operating agreement and annual meetings not required but recommended | LP-1 filed with state,partnership agreement annual meeting not required but recommended |
| Limitations on transfer-ability of interest | Transfers may be limited by agreement or by securities law | Transfers may be limited by agreement or by securities laws; transfers to non qualified persons may cause loss of S corporation status | Majority consent may be required by non transferring members | Consent of all partners may be required |
| Business status after death or departure of owner | Corporation continues | Corporation continues | In some states, dissolution unless members vote to continue | Automatic dissolution unless provided in partnership agreement |
| Taxation of business profits | Corporate profits taxed at corporate rates; dividends taxed at individual rates of shareholders | Individual tax rates of shareholders | Individual tax rates of members unless LLC elects corporate taxation | Individual tax rates of general and limited partners |
| Double taxation | C corporations are double taxed only when earnings are distributed to share- holders as dividends | No | No | No |
