The main differences between an S-Corporation and a C-Corporation are found in the taxes paid and on the number of owners allowed in the corporation. Under a C-Corporation the company pays corporate income tax and the shareholders pay federal income taxes through dividends. S-Corporations on the other hand have pass-through taxation where they record their business income and losses on their personal tax returns. As far as ownership is considered C-Corps have no restrictions on the number of owners, but S-Corps can only have up to 100 shareholders that must reside in the United States.