Entity Comparison

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entity-comparison

The following table provides a look at the LLC vs Corporation, and LLC vs S-Corporation.

C-Corporation
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LLC
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S-Corporation
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  Type of
 Organization
   Stock, there may
  be different classes.
  Membership interests.
  There may be different
  classes of membership.
  One class of stock.
  Which may be voting or
  non-voting.
   Eligible
  Owners
  No restrictions.   No restrictions.   100 shareholder limit.  
  No non-individual and no
  non-resident alien
  shareholders.
  Management
  Managed by director(s)
  and officer(s).
  Two Management Types
  – Managed by Manager
  – Managed by Members
  Managed by director(s)
  and officer(s).
  Ownership
  Allocations
  None. Dividends must  
  be paid based upon  
  stock ownership.
  Permitted if the
  allocations have
  substantial economic
  effect.
  None. Income, gain, 
  and loss pass-through
  to the shareholders
  based on the
  percentage of shares
  owned.
  Liability
  Protection
  There is limited liability
  for shareholders,
  officers and directors.
  There is limited liability
  for members and
  managers (if applicable)
  There is limited liability
  for shareholders,officers
  and directors.
  Duration
  Perpetual   Dissolves at the time
  specified in the
  Operating Agreement or
  upon the loss of a 
  member unless
  other members agree to
  continue.
  Perpetual
  Transfer of
  Ownership
  Shares freely
  transferred.
  There may be
  restrictions under
  certain state laws.
  Shares can be
  transferred only to
  eligible S-corporation
  shareholders