A corporation is treated in law as being separate and distinct from its owners. It is the US equivalent of a company in the UK. Corporations enjoy most of the rights and responsibilities of an individual possesses. A corporation has the right to enter into contracts, loan and borrow money, sue and be sued, hire employees, own assets and pay taxes.

The most important aspect of a corporation, as with a UK company, is limited liability. That is, shareholders have the right to participate in the profits, through dividends and/or the appreciation of stock, but are not held personally liable for the company's debts.
A corporation is created (incorporated) by a group of shareholders who have ownership of the corporation as represented in their ownership of common stock. A corporate charter is a written document filed with a U.S. state by the founders of a corporation detailing the major components of a company such as its objectives, its structure and its planned operations.
If the charter is approved by the state government, the company becomes a legal corporation. This is also referred to as "charter" and "articles of incorporation".

The details of a charter will vary based on specific regulations and the size of the company. At the most basic level, the charter will include the corporation's name, its purpose, the number of shares that are authorised to be issued and the names of the parties involved in the formation.

Authorised and issued shares have the same meaning as with UK companies, that is not all authorised shares need be issued. This gives the present owners (shareholders) the ability to raise new investment by exchanging authorised but not yet issued shares for investment capital.

A limited liability company (denoted by L.L.C. or LLC) is an alternative to the corporation. The law of many of the United States treats a LLC as is a legal form of business company offering limited liability to its owners. It is similar to a corporation, and is often a more flexible form of ownership, especially suitable for smaller companies with a limited number of owners.

Unlike a regular corporation, a limited liability company with one member may be treated as a 'disregarded entity'. That is, the member is often singled-out as a person performing the actions of the LLC. An LLC can elect to be either "member managed" or "manager managed."
Limited liability, meaning that the owners of the LLC, called "members," are protected from some liability for acts and debts of the LLC, but are still responsible for any debts beyond the fiscal capacity of the entity. Using default tax classification, profits are taxed personally at the member level, not at the LLC level.

Sometimes it can be more difficult to raise financial capital for an LLC than for a corporation as investors may be more comfortable investing funds in the better-understood corporate form. This also forms a basis for an eventual Initial Public Offering (IPO) when the shares are traded publicly on a stock exchange. One possible solution may be to form a new corporation and merge into it, dissolving the LLC and converting over to a corporation.
Finally, LLCs cause tax problems with intellectual property if you later need to move to a regular Corporation.