C Corporations and S Corporations
A C corporation is the default classification for federal tax purposes of how a corporation will be taxed. By operating as a C corporation, the corporation itself will be subject to a federal income tax and a Florida income tax. Any earnings distributed from the C corporation to the shareholders will be subject to an individual federal income tax. However, a corporation or a limited liability company may elect to be taxed as an S corporation. This election allows the corporation or the limited liability company the benefits of pass through treatment of income and avoids the double taxation of a C corporation. Although being treated as an S corporation imposes limitations on ownership by different types of shareholders and restrictions on different classes of stock.