Corporations are business entities that are separate from their owners; corporations have shareholders, and the shares may be privately or closely held, or they may be offered for sale to the public (publicly held). Corporations are formed by submitting Articles of Incorporation to the state in which the corporation is doing business. Corporations are taxed separately from their owners at the corporate tax rate.
Because corporations are separate entities, the debts and liabilities of the corporations are also separate from those of the owners. This separation is sometimes called a "corporate shield."