Well, you have C Corps, S Corps, and LLCs. Do these differ, and if so, does the form of entity in which you invest even matter?
You bet it does. The differences in taxation, the flexibility in ownership, and the capital structuring among these three company structures can be significant.
C Corporation (C Corp.): Owners of a C Corp. are called “shareholders” or “stockholders.” As an investor, you’re a part-owner and are given stock certificates to evidence that ownership.
Additionally, from a legal perspective, a C Corp. is treated as a separate entity from its owners/shareholders. This separation shields you from debts or obligations the company may incur.
S Corporation (S Corp.): Like a C Corp., owners of an S Corp. are also called “shareholders” or “stockholders.” You, as a part-owner, are given stock certificates as proof of that ownership.
An S Corp. is also a separate entity from its shareholders, shielding you from debts or obligations the company may incur.
The main difference between a C Corp. and an S Corp. is how the income is taxed. We’ll expand the discussion of taxation later on in Part 3, “Company Structures and Your Tax Money.”
Limited Liability Company (LLC): Owners of an LLC are called “members.” Instead of stocks, you (as a member/part-owner of the LLC) receive “membership interest.”
This membership interest is usually expressed in percentages (e.g., a 10% membership interest) or in units (e.g., 10 units), which generally correspond to your percentage in ownership. 
Unlike shareholders of a C Corp. and an S Corp., who receive stock certificates to evidence ownership, LLC members receive charter documents, e.g., “Articles of Organization” and “Operating Agreement.”
An LLC also protects members from debts or obligations the company may incur.
Note: Although all three entities intend to shield members and shareholders from obligations incurred by the company, there’s no absolute guarantee that they will be shielded. Please consult with your lawyer.
When you invest in this report, you’ll also receive a quick, easy-to-read 5-page report called “5 Reasons Seasoned Investors Prefer Companies Incorporated in This State” – a must-read for new angels and first-time entrepreneurs who are planning to raise money from professional investors.
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