Q:

What is a corporation license?

A:

Quick Answer

A corporation license is essentially a business license for an incorporated business, allowing the business to act as a business entity, such as an LLC or full corporation. This license provides some legal protections to the owners, but it has limits to how extensively this protection applies.

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Full Answer

A corporation is a business that acts like a legal entity. This entity can file suits, buy and sell property and even commit crimes, making it inherently separate from its owners in some ways. In the same vein, a corporation is also considered open to legal action taken against it. Corporations are legally considered people, with many similar legal considerations applying to them the same as they do to any other person.

A corporation license is paperwork that tells the government that a business is certified to be considered a corporation or LLC. This means the business is no longer dependent entirely on its current owners to continue existing, and can exist well beyond the lifespan of the people that founded it. While a business license is filed in order to do business, such as selling goods and other merchant practices, corporation licenses exist for the sake of the long-term legal benefits they grant a business.

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