Either articles of incorporation (corporation) or articles of organization (LLC) will be filled out and submitted, along with the applicable application fee. Furthermore, both types of businesses operate as separate legal entities from its owners, thereby allowing for the liability protection.īoth the LLC and corporation must file a formal document registering the business with the Florida Secretary of State. As previously noted, both businesses provide limited liability protection for the owners and shareholders. There are both similarities and differences between the LLC and corporate business structure. There are greater state and federal regulations for corporations.
There are additional corporate formalities required for corporations.It costs more to form a corporation than a partnership, sole proprietorship, or LLC.While there are several advantages to operating a corporation in the state of Florida, there are some disadvantages to the corporate business structure as follows: Unlike the corporation, other business structures, such as the LLC and partnership, cannot sell shares. It is easier for a corporation to raise capital through selling shares and bonds. It is rather easy and straightforward for one owner to sell shares of stock to another, without having to fill out any complex paperwork. There are several tax benefits to a corporation, including insurance and retirement deductions. Furthermore, a sale of shares will not cause the business to automatically terminate. Some examples of piercing the corporate veil might include if the owner engaged in fraudulent or otherwise illegal activity, if the owner personally guarantees a loan, or if an owner holds himself out to be an extension of the corporation.Ĭorporations have an unlimited existence, as the death or illness of an owner will not cause dissolution of the business. While there are some exceptions to this rule, which are referred to as instances of piercing the corporate veil, most often, creditors cannot use the owners’ personal assets to satisfy the business debts. Similar to that of an LLC, the corporate business structure offers limited liability protection for its owners. Easier to raise money than other business structures.There are many advantages to operating a Florida corporation some of the advantages include: This means that the shareholders cannot be held personally liable for the debts of the business. Particularly, the Florida corporation operates as a separate and distinct legal entity from its shareholders, who are also the owners of the company.
Most corporations, unless they are formed as a nonprofit corporation, are established for the sole purpose of making a profit. For Profit CorporationĪ Florida profit corporation is a corporation that is established for the purpose of making a profit.
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