An open or general corporation provides stock that the general public can easily purchase. The general corporation can have from one shareholder to more than 30. The shareholders owning more than 50 percent of the shares control corporate policy and activities through their presence or representation, through proxies, or by being on the board of directors. Non-profit organizations do not issue stock. They use membership certificates.
Some small businesses use non-profit corporations as a tax shelter.
The C-corporation pays taxes on its own income, called corporate taxes. The shareholders then pay taxes on the money they receive. The business usually continues after the death of any owner. A limited liability company or LLC, is a new type of business operating entity with legal status in most states. It resembles a combination of an S-corporation and a partnership, in that it combines the tax advantages of a partnership by avoiding a corporate income tax, with the legal safeguards of a corporation.