An entity created in accordance with legal rules that acts as a single (fictional) person. A corporation may sue and be sued, lend, borrow, issue stock, exist indefinitely, and act in many other ways distinct from the shareholders who own it and the managers who run it. Each U.S. state can create rules by which new corporations are formed (i.e., rules of incorporation).
See Artificial person and Natural person.
Definition from Nolo’s Plain-English Law Dictionary
A legal structure authorized by state law that allows a business to organize as a separate legal entity from its owners. A corporation is often referred to as an "artificial legal person," meaning that, like an individual, it can enter into contracts, sue and be sued, and do the many other things necessary to carry on a business. One advantage of incorporating is that a corporation's owners (shareholders) are legally shielded from personal liability for the corporation's liabilities and debts (unpaid taxes are often an exception). (See also: nonprofit corporation
, C corporation
, S corporation
Definition provided by Nolo’s Plain-English Law Dictionary.
August 19, 2010, 5:13 pm