A C Corporation is a legal entity that is separated from its owners (shareholders). It can own property, enter into contracts, and is responsible for its own debts and liabilities. C Corporations have double taxation. This means that the corporation pays taxes on its profits at the corporate level, and then shareholders pay taxes again on dividends they receive from those profits at their individual tax rates. They are subject to the corporate income tax rate, which is set by federal law. The current federal corporate tax rate was a flat 21%. State corporate tax rates vary by state. There are no restrictions on the number or type of shareholders in a C Corporation, unlike S Corporations. C Corps can also have multiple classes of stock, which can include different voting and dividend rights.