BUSINESS STRUCTURE COMPARISON CHART
Formation
Requirements
Basic
Organizational
Documents
Continuity of Life
C Corporation
S Corporation
Complex with higher costs
Complex with higher costs
Charter (articles of
organization or certificate
of incorporation), Bylaws
and Incorporators,
Stockholders and
Directors consents
Charter (articles of
organization or certificate
of incorporation), Bylaws,
form 2553 filing with IRS
and Incorporators,
Stockholders and
Directors consents
Yes
Yes
Limited Liability
Company (LLC)
May be complex or simple;
higher costs.
Certificate of Formation
and optional Operating
Agreement
Limited Partnership
(LP)
May be complex or simple;
reasonable costs.
Certificate of Limited
Partnership and Limited
Partnership Agreement
General Partnership
(GP)
May be simple; lower costs.
Partnership Agreement
(optional); Business
Certificate filing with local,
county or state authority.
Declaration of Trust. SOS
filing if trust has
transferable shares. Real
estate trusts file with the
registry of deeds.
Otherwise business
certificate filing with local,
county or state authority.
Yes, unless dissolution date
is stated in the Certificate
of Formation or Operating
Agreement.
Terminates upon the death
or resignation of General
Partner or dissolution date
stated in the Limited
Partnership Agreement
Terminates upon the death
or resignation of partners or
the dissolution date stated
in Partnership Agreement.
Terminates upon the death
of beneficiary or the earlier
termination date specified
in the Declaration of Trust.
Owner Liability for
Obligations of the
Entity
Stockholders have limited
liability
Stockholders have limited
liability
Members have limited
liability
Limited Partners have
limited liability, General
Partners have joint and
several liability
Partners have joint and
several liability
Operating
Documents
Management
Charter and Bylaws
Charter and Bylaws
Stockholders elect the
Directors; Directors
manage overall strategy and
control significant
corporate events; Officers
manage day-to-day affairs
under direction of Directors
as specified in the Charter
and Bylaws.
Stockholders elect the
Directors; Directors
manage overall strategy and
control significant
corporate events; Officers
manage day-to-day affairs
under direction of Directors
as specified in the Charter
and Bylaws.
Operating Agreement (if
any)
Members may elect
Manager(s) or Managing
Member(s) to manage dayto-day affairs; officers (if
any) perform under
direction of Manager(s) as
specified in the Operating
Agreement.
Limited Partnership
Agreement
Limited Partners are
owners along with General
Partner. Limited Partners
are passive investors except
as specified in the Limited
Partnership Agreement.
General Partner(s) controls
the entity and manages day
to day affairs as defined in
the Limited Partnership
Agreement.
Partnership Agreement (if
any)
Partners own and operate
business as defined in the
Partnership Agreement (if
any).
Business Trust
Sole Proprietorship
May be simple; lower costs.
Easiest to start; no start-up
costs.
Business certificate filing
with local, county or state
authority.
Terminates upon the death
of the sole proprietor.
Owners have no liability
protection.
Declaration of Trust
Governed by Trustee(s) as
specified in the Declaration
of Trust.
None
Owned and operated by the
sole proprietor.
C Corporation
S Corporation
Type of Ownership
Interest
Stock
Stock
Business Taxed at
Federal Tax Level?
(Double Taxation)
Yes
No
Business Taxed at
State Tax Level?
Yes
No
Annual Report
Requirements
Yes
Yes
Limited Liability
Company (LLC)
Membership Interests
Limited Partnership
(LP)
Limited Partnership
Interests
General Partnership
(GP)
Partnership Interests
Business Trust
Sole Proprietorship
None Issued
No
None issued unless the trust
contains beneficial
interests.
If only one owner, trust will
be treated as sole
proprietorship; if two
owners as partnership
Depends upon how the
LLC chooses to be taxed by
IRS on form 8832. Users
should consult the tax laws
of the state of domicile and
the state of organization.
Depends upon how the
LLC chooses to be taxed by
IRS on form 8832 Users
should consult the tax laws
of the state of domicile and
the state of organization.
Yes
No
No
No
Yes
No; Owner pays state taxes
on profit/loss.
No
No
Yes
No
No; Owner pays federal
taxes on profit/loss.
