An experienced business lawyer can assist you set up a corporation. The most popular reason for the formation of a corporation is the liability protection a corporation offers to its shareholders. Individuals who own a corporation are not liable under law for the debts and obligations of the corporation. Since a corporation is a legal "person" it has the standing to sue and can be sued, distinct from its stockholders. Since a corporation is a separate legal "person", shareholders cannot be personally liable for corporate debts. Ownership in the corporation (shares) are easily transferable. Stockholders can also sue the corporation through a derivative suit. The legal "person" status of corporations gives the business perpetual life and the deaths of officials or stockholders do not alter the corporation’s structure and the corporation continues in existence. Unlike sole proprietors and general partners in a partnership who are personally and jointly responsible for all the liabilities of a business such as loans, accounts payable, and legal judgments, in a corporation, however, the stockholders, directors and officers usually are not liable for their corporation’s debts and obligations. Their personal liability is limited by the number of shares they own. The shareholder can held liable for the debts of the corporation if a shareholder has given a personal guarantee. Corporations can posses personal assets like houses, cars or boats. The assets of the corporation are safe from the creditors of the shareholders and directors. A creditor of the owner of a corporation cannot seize the assets of the corporation, however, they can seize their ownership shares in the corporation, as that is considered a personal asset. Stockholders can transfer their ownership in a corporation easily to others, either in whole or in part. Compared to other business structures, it is much easier to set up retirement funds and qualified retirement plans with a corporation.

A corporation is capable of continuing indefinitely and has an unlimited life span. Its existence extends beyond and is not affected by the death of shareholders, directors, or officers of the corporation. Corporations have more ability to raise money. Because of its separate existence, a corporation can acquire its own credit ratings and develop its own credit history by applying for and using credit. These ratings are independent of the owner’s ratings. Corporations can borrow and incur debts. They can also sell the shares and raise equity capital which does not have to be repaid and incurs no interest. A corporate structure can give a very strong impression to customers, suppliers and other business associates. For many people, a corporation is a symbol of permanence, credibility and stature. Corporations are usually seen as being more stable than unincorporated businesses. The earnings of a corporation remain within the corporation until paid out. Profits are distributed to shareholders as dividends or through redemption of shares, or the repurchase of shares by the corporation. The board of directors has the discretion to declare dividends. Consult with an experienced business lawyer to know the advantages of a corporation