A corporation is a business, whereas the term “incorporated” is an adjective used to describe a business. Businesses become incorporated by filing articles of incorporation. Many Fortune 500 companies are corporations.
Although many Fortune 500 companies are corporations, the size of the business does not determine whether it is a corporation. One individual can also own and manage a corporation. They must file articles of incorporation with their state, just as other big businesses. Additionally, they have to maintain financial documents and submit them quarterly.
Many people incorporate their business because they like the protections the law affords them. When someone sues a corporation, they cannot sue the owner or board members because they are not responsible. Corporate liabilities limit legal actions because a corporation is separate from the board members or owners.
Another benefit to becoming a corporation is reduced taxes. When people incorporate a business, they pay taxes on their business profits. For many corporations, the ability to pay taxes on a smaller portion of revenue saves tax dollars. They are still responsible for paying individual taxes from each check, but the savings are significant if the corporation has a lot of revenue coming into the business and a lot of expenses.