Corporation
Definition:
A corporation is a legal entity formed under state law that is separate and distinct from its owners, known as shareholders. It has the ability to own property, enter into contracts, sue or be sued, and conduct business in its own name. Corporations provide limited liability protection, meaning shareholders are typically not personally responsible for the company’s debts or obligations. This structure is commonly used for businesses seeking to raise capital, expand operations, or establish long-term continuity.
Corporation Information
A corporation is created by filing formal documents—typically called the Articles of Incorporation—with the state. Once established, it operates as an independent legal entity with perpetual existence, meaning it continues even if ownership changes. Corporations can issue stock to raise funds, making them an attractive choice for larger or growth-oriented businesses. They are governed by a board of directors, who oversee major decisions, and officers, who handle daily operations. Corporations must comply with state and federal laws regarding taxation, reporting, and governance.
Florida Legal Definition
Under Florida law, a corporation is defined as an entity formed under Chapter 607, Florida Statutes (Florida Business Corporation Act). To form a corporation in Florida, the incorporator must file Articles of Incorporation with the Florida Division of Corporations and pay the required fees. Corporations in Florida must maintain a registered agent, hold annual meetings, and file annual reports to remain in good standing. The law provides limited liability protection to shareholders, except in rare cases of fraud or misconduct where the corporate veil may be “pierced.” Florida statutes also recognize nonprofit corporations under Chapter 617.
How It’s Used in Practice
In practice, corporations are widely used by entrepreneurs, investors, and professionals to conduct business while protecting personal assets. Many Florida-based corporations are structured as C-corporations or S-corporations, depending on their tax preferences and shareholder arrangements. Corporations are often used for real estate development, financial services, healthcare, and retail operations. Attorneys and accountants assist in formation, drafting bylaws, maintaining corporate records, and ensuring regulatory compliance. Proper corporate governance helps avoid disputes and ensures long-term operational success.
Key Takeaways
- A corporation is a separate legal entity that can own property, enter contracts, and conduct business independently of its owners.
- Shareholders have limited liability for the corporation’s debts and obligations.
- Florida corporations are formed under Chapter 607, Florida Statutes, by filing Articles of Incorporation.
- Corporations must maintain proper governance, including a board of directors, officers, and annual filings.
- This structure offers advantages in liability protection, fundraising, and business continuity.
Disclaimer: The information and opinions provided are for general educational and informational purposes only and should not be construed as legal advice or a substitute for consultation with a qualified attorney. Reading this glossary does not create an attorney–client relationship with Barnes Walker, Goethe, Perron & Shea, PLLC, or any of its attorneys. Because laws, regulations, and court interpretations may change over time, the definitions and explanations provided here may not reflect the most current legal standards. The application of law varies depending on your particular facts and jurisdiction. For advice regarding your specific situation, please contact one of our Florida attorneys for personalized guidance.
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