Essaminc — What an incorporated company is and how one | essaminc.com
Three suffixes decide who owns the company, who pays the tax and what the public can see.
An Inc — formally a C-corporation — is owned by shareholders. The company pays tax on its profit and the owners pay tax again on dividends, so the same money is taxed twice. Profit reaches the owners as dividends, and the corporation registers with its state's Secretary of State.
An LLC is owned by members. Profit passes through to their personal returns and is taxed once; a single-member LLC is disregarded by default and files one Form 1040 with a Schedule C. It registers with the state through its formation filing and can later elect to be taxed as a corporation.
A UK Ltd is a separate legal person limited by shares, and since 2008 a £1 nominal share has been allowed. It registers at Companies House, files accounts every year and a confirmation statement once every 12 months — a public paper trail no US LLC matches.
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A US LLC generally files a state annual report but has no equivalent public accounts filing unless it is a corporation. So the Ltd is the most public of the three, the LLC the most private, and the Inc the most heavily taxed at the federal level.
All three make the company a separate person, which is what limits the owners' liability; a sole proprietorship has no separate person at all and the business sits on the owner's personal return. An LLP is a partnership form outside the verified figures in this guide, so it is noted here but not priced.
For what each form costs to create and to keep, see /incorporation-cost-and-fees; for the filings that keep each one in good standing, see /registered-agent-and-annual-report.
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