Should I set up a C corporation or an S corporation?
The major difference between a corporation being a C corporation or an S corporation is that S corporations use the pass-through taxation that partnerships use, while C corporations are subject to double taxation. If this is an issue you are considering, you should meet with an attorney and/or a tax advisor so that you can figure out what works best for your situation. Also, you should remember that this decision is not a permanent one, so if you initially elect to set your corporation up as an S corporation, you can always change it over to a C corporation later. In addition, if you are giving serious consideration to an S corporation because of the pass-through taxation, you should also consider setting up your business as an LLC, which also generally has pass-through taxation.