Business Entity Comparison Table

S Corporations are not a special business entity. They are general corporation that have adopted a special
tax treatment. Note that only LLCs and Corporations are chartered entities.

Characteristics General Partnership LLC S Corp Corporation

Agreement of parties File with

File with state for File with state for
Formation involved. No permission state for
permission permission
required permission
Dissolved by death of Typically limited to a
Duration Perpetual Perpetual
partner or bankruptcy fixed amount of time
Shareholders
are typically
Shareholders are
Members not typically not
Partners have unlimited typically not personally
Liability liable for the debts of personably
liability liable for the debts of
the LLC liable for the
the corporation
debts of the
corporation
Formality of
board of
Some formal Formality of board of directors,
Simplicity of Relatively few legal requirements but less directors, officers, officers,
Operation requirements formal than annual meetings and annual
corporations annual reporting meetings
and annual
reporting
The
corporation
The corporation is is managed
Typically each partner Members have
managed by the board by the board
has an equal voice operating agreement
Management of directors who are of directors
unless otherwise that outlines
elected by the who are
arranged management
shareholders elected by
the
shareholders
If properly structured
Each partner pays tax
there is no tax at the No tax at entity level.
on his/her share of the Corporation
entity level. Income / loss is passed
Taxation income and can deduct is a taxable
Income/loss is passed through to the
losses against other entity.
through to members of shareholders
sources of income
the LLC
No,
corporate
Pass Through losses can't
Yes Yes Yes
Income/Loss be deducted
by
shareholder
Double
No No No Yes
Taxation
Filing fee
Cost of
None Filing fee with the state Filing fee with the state with the
Creation
state
Possible to sell
Contributions from Sell shares
interests. Subject to Sell shares of stock to
Raising Capital partners or an addition of stock to
operating agreement raise capital
of more partners raise capital
restrictions
Shares of
stock in a
Transferability
No Possibly Yes, subject to consent corporation
of Interest
are easily
transferable