(208) 415-1850 contact@cdaaccounting.com

Forming an Idaho C-Corporation Pros and Cons

by | Jul 15, 2020 | Business

Are you looking for a business entity that will save you thousands of dollars of taxes for your Coeur d’Alene Idaho company?

This type of Idaho business structure is considered the most formalized and complex form of an Idaho business organization. It is costlier, more complicated, and requires more paperwork. However, many advantages would make the Idaho C-corporation an ideal business structure for many new Coeur d’Alene businesses.  Ownership of an Idaho corporation is divided into shares of stock. The Idaho business activities are dictated by a charter stating the powers and limitations of the particular Idaho business. Idaho corporations that do business in more than one state must comply with the Federal laws regarding interstate commerce and with the state laws.

Advantages of an Idaho C-corporation for your Coeur d’Alene business

  • Liability is limited.

Stockholders in an Idaho corporation are not personally liable for claims against the corporation.

  • Life of the business is unaffected by death or transfer of shares by and of its owners.

The business will continue as a corporation indefinitely. 

  • Easier to raise capital in larger amounts and from many investors.

in an Idaho c-corporation, it can be significantly easier to raise capital and to do it in more significant amounts and the best part you can do it from multiple Idaho investors

  • Delegated authority.

Centralized control is secured when owners delegate authority to hired managers.

  • Cash to grow.

An Idaho corporation can set aside untaxed money for specified future growth costs. 

Disadvantages of an Idaho c-corporations

  • More expensive to form.

There are many forms to file, such as articles of incorporation charters, permits. The fees for filing these forms can be substantial.

  • Power limited by charter and various laws.

Once established, the charter dictates all decisions and activities of the Idaho corporation.

  • Extensive record keeping.

 Because of the various forms involved with a corporation and continuous filing schedules with the government, both state and federal, ongoing bookkeeping and accurate record-keeping is essential.

  • Double taxation.

Taxes on profits of the business and taxes on dividends are paid to the owners.