When a corporation enters into a transaction, it is the corporation and not the shareholders who is responsible. When starting up, a bank may require a personal guaranty since your company doesn't yet have a credit history but, as a rule, a shareholder's liability is limited to the amount invested into the company. Creditors cannot reach beyond the assets of the company in normal circumstances. The same is true with lawsuits. It is the corporation not you who will be sued (assuming the lack of unusual circumstances such as fraudulent undercapitalization.)
Tax Considerations! It's true that the potential exists for double taxation (see What is "pass-through taxation?) However, you can avoid this with the use of a LLC or by electing to be treated as an S Corporation. With the corporate form of ownership, you can usually elect to implement various tax-free benefits such as life and health insurace and retirement plans
Transfering ownership and raising capital are usually easier through the use of stock. Corporations usually have a perpetual life as well, distinct from that of the shareholders.
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