Start a C-Corp — Incorporate Your Business Online
Build for growth, raise capital, and issue stock. A C-Corporation is the gold standard for startups seeking investors, hiring with equity, and scaling beyond a small business. BusinessFormations.com handles your incorporation from name search to state filing.
What Is a C-Corporation?
A C-Corporation (C-Corp) is a legal business entity that is separate from its owners in every way — legally, financially, and for tax purposes. It is the most common corporate structure in the United States and the standard entity type for venture-backed companies.
Unlike an LLC, a C-Corp has a formal governance structure with shareholders (owners), a board of directors (oversight), and officers (management). It can issue multiple classes of stock, which makes it the ideal vehicle for raising capital from angel investors and venture capital firms.
C-Corps are taxed at the entity level at the federal corporate tax rate of 21%. When profits are distributed to shareholders as dividends, they are taxed again at the individual level — this is known as “double taxation.” Despite this, C-Corps remain the preferred structure for high-growth companies because of their ability to raise capital, retain earnings, and offer equity compensation.
Some of the world’s largest companies — Apple, Google, Amazon — are C-Corporations. But you don’t need to be Fortune 500 to benefit from the C-Corp structure.
C-Corp at a Glance
- Separate legal entity from its owners
- Issue common & preferred stock
- Unlimited number of shareholders
- No restrictions on shareholder type or residency
- Perpetual existence (survives ownership changes)
- 21% flat federal corporate tax rate
- Eligible for QSBS capital gains exclusion
Benefits of Forming a C-Corporation
Why C-Corps are the standard for companies building for scale.
Raise Capital from Investors
C-Corps can issue multiple classes of stock — common shares for founders, preferred shares for investors. This is the structure VCs and angel investors expect. If you plan to raise, a C-Corp is effectively required.
Stock Options & Equity Compensation
Attract top talent with Incentive Stock Options (ISOs), Restricted Stock Units (RSUs), and equity grants. These tools are only available through C-Corps and are essential for startup hiring.
Strong Liability Protection
Shareholders’ personal assets are shielded from corporate debts and lawsuits. The corporate veil provides the strongest liability protection available under U.S. business law.
Perpetual Existence
A C-Corp exists independently of its owners. It doesn’t dissolve when founders leave, shareholders sell, or ownership changes. This continuity is essential for long-term businesses and investors.
Retain Earnings at 21%
Profits retained in the corporation are taxed at a flat 21% federal rate — often lower than individual rates. This makes C-Corps efficient for reinvesting profits back into the business.
No Ownership Restrictions
Unlike S-Corps, C-Corps have no limits on shareholder count and no restrictions on who can own shares. Foreign investors, other corporations, trusts, and institutions can all hold stock.
How to Incorporate — Step by Step
We handle every step of the incorporation process. Here’s exactly what happens.
Choose Your State of Incorporation
Delaware is the most popular state for C-Corps — especially for startups seeking investors. Its well-established corporate law, business-friendly Court of Chancery, and investor familiarity make it the default choice. However, incorporating in your home state is simpler if you’re not raising outside capital.
Name Your Corporation
Your corporate name must be unique in your state and include a designator such as “Inc.,” “Corp.,” or “Incorporated.” We check availability and suggest alternatives if needed.
Designate a Registered Agent
Every corporation needs a registered agent to receive legal and government correspondence. We provide registered agent service in all 50 states with a secure online document vault.
File Articles of Incorporation
The Articles of Incorporation (called a Certificate of Incorporation in Delaware) is the formation document filed with the state. It includes your company name, registered agent, share structure, and incorporator information. We prepare and file this on your behalf.
Create Corporate Bylaws
Bylaws are the internal rules governing your corporation — board meeting requirements, officer roles, voting procedures, and record-keeping obligations. They’re not filed with the state but are legally required.
Appoint Directors & Officers
Your board of directors provides oversight; your officers (CEO, Secretary, Treasurer) handle daily management. Initial appointments are documented in your organizational board resolution.
Issue Stock
After incorporation, you must formally issue shares to the founders. This includes setting the authorized share count, par value, vesting schedules (if applicable), and recording the issuance in the corporate minute book.
Obtain Your EIN
Your Employer Identification Number (EIN) is required to open bank accounts, hire employees, set up payroll, and file taxes. We obtain it from the IRS — usually same-day.
Open a Business Bank Account
With your Articles of Incorporation, EIN, bylaws, and our banking resolution, you’re ready to open corporate bank accounts and begin operating.
Maintain Corporate Compliance
C-Corps have ongoing obligations: annual reports, franchise taxes, board meetings, meeting minutes, and stock ledger maintenance. Our compliance alert system keeps you on track.
Why Delaware? The Gold Standard for Incorporation
More than 60% of Fortune 500 companies are incorporated in Delaware — and there are very specific reasons why.
🏛️ Court of Chancery
Delaware’s dedicated business court has no jury trials — cases are decided by expert judges. This produces faster, more predictable outcomes for corporate disputes. Investors and attorneys know the case law well.
📚 Mature Corporate Law
The Delaware General Corporation Law (DGCL) is the most developed body of corporate law in the country. Decades of case law provide clarity on governance issues that other states haven’t resolved.
🤝 Investor Expectation
VCs, angel investors, and accelerators overwhelmingly expect Delaware C-Corps. Standard investment documents (SAFEs, convertible notes, Series A docs) are all drafted for Delaware law. Using another state creates friction.
📈 Stock Flexibility
Delaware allows multiple classes of stock with customizable rights, preferences, and restrictions. This is essential for structuring preferred stock rounds, anti-dilution protections, and liquidation preferences.
🔒 Privacy & Director Protection
Delaware doesn’t require directors or officers to be listed in formation documents. It also allows strong indemnification provisions that protect directors from personal liability for good-faith decisions.
💡 No State Income Tax on Holdcos
Corporations incorporated in Delaware but operating elsewhere don’t pay Delaware corporate income tax. You only pay the annual franchise tax — which starts at $400 per year for small companies.
Do you need Delaware? If you plan to raise venture capital, definitely yes. If you’re bootstrapping a small business, incorporating in your home state is usually simpler and cheaper. Our free assessment will recommend the right state for your situation.
C-Corp Formation Packages
Every package includes state filing. Choose the level of support your corporation needs.
Starter
Basic incorporation filing
- ✓Name availability check
- ✓Articles of Incorporation
- ✓Bylaws template
- ✓Organizational minutes
Growth
Ready to operate & bank
- ✓Everything in Starter
- ✓EIN registration
- ✓Banking resolution
- ✓Registered agent (1 year)
- ✓Compliance reminders
Venture
Investor-ready corporate structure
- ✓Everything in Growth
- ✓Board resolutions & minutes
- ✓Stock certificates & ledger
- ✓Equity documentation
- ✓Expedited filing
- ✓Dedicated specialist
For startups raising capital: The Venture package gives you the complete corporate structure investors expect — Articles of Incorporation, bylaws, board resolutions, stock issuance, and equity documentation. Your attorneys will thank you.
How C-Corps Are Taxed
C-Corp taxation works differently from LLCs and S-Corps. Here’s what you need to know.
Corporate-Level Tax (21%)
A C-Corp pays federal income tax at a flat 21% rate on its profits