Choosing a business structure is a critical step every business owner must take into consideration when going through the incorporation process. The following chart provides a high-level comparison of the most popular forms of business structure and their attributes:

Sole
Proprietor
General
Partership
C-Corp S-CorpProfessional CorporationNonprofit CorpLimited Liability Company
FormationNo filing requiredNo filing requiredState filing requiredState filing requiredState filing requiredState and federal filings requiredState filing required
Limited personal liabilityNoNoYesYesYes, except for
own malpractice
YesYes
Transferability of interestNoNoYesGenerally LimitedGenerally LimitedN/AYes, Often Limited
DurationUntil withdrawal or death of ownerUnlimitedUnlimitedUnlimitedUnlimitedUnlimitedUnlimited
Pass-through taxationYesYesNoYesNoTax ExemptYes, upon election
Ability to raise capitalNot as separate entityYesYesYes, but shareholder limitsYesYes, through donations and grantsYes
Limitations on number of ownersYesNoNoYesNo, but all owners must be part of same professionN/ANo