A C-Corporation is a business entity that is legally separate from its owners and taxed at the corporate level (21% federal rate). Profits distributed as dividends are taxed again at the shareholder level — this 'double taxation' is the main disadvantage. However, C-Corps are the preferred structure for companies seeking venture capital or planning an IPO, as they can issue multiple classes of stock. C-Corps file Form 1120. For E-2 visa businesses, C-Corps are sometimes used when outside investors are involved or when the business plans to scale significantly.
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