corporation

noun
cor·​po·​ra·​tion | \ ˌkȯr-pə-ˈrā-shən How to pronounce corporation (audio) \

Definition of corporation

1a : a group of merchants or traders united in a trade guild (see guild sense 1)
b : the municipal authorities of a town or city
2 : a body formed and authorized by law to act as a single person although constituted by one or more persons and legally endowed with various rights and duties including the capacity of succession
3 : an association of employers and employees in a basic industry or of members of a profession organized as an organ of political representation in a corporative state

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Examples of corporation in a Sentence

He works as a consultant for several large corporations. a substantial corporation that showed that he was a sucker for all-you-can-eat buffets

Recent Examples on the Web

Chip Somodevilla/Getty Images Right after the Republican tax cut bill passed a year ago, corporations made a slew of announcements pegged to the legislation, including some that gave workers one-time bonuses. Emily Stewart, Vox, "Companies who donated to Republicans made sure the tax cuts looked helpful for workers," 17 Dec. 2018 At the time, corporations and planners thought innovation happened in manicured, modernist, suburban campuses—like the 326-acre Warren Tech Center General Motors opened in Michigan—not cities. Patrick Sisson, Curbed, "As top innovation hub expands, can straining local infrastructure keep pace?," 6 Nov. 2018 In the 1960s, corporations were making tons of money, just like now. Eric Johnson, Recode, "Silicon Valley has been treating workers ‘miserably’ since the 1970s," 29 Aug. 2018 The firm works with political campaigns, private corporations and nonprofits. Daniel Bice, Milwaukee Journal Sentinel, "Bice: Ironworker Randy Bryce being paid undisclosed amount by Democratic firm," 11 July 2018 Kids In Need of Defense partners with major law firms, corporations and bar associations to create a nationwide pro bono network to represent unaccompanied children through their immigration proceedings. Alex Samuels, star-telegram, "These organizations are mobilizing to help immigrant children separated from their families," 23 June 2018 Alderman Scott Waguespack, a member of the City Council's progressive caucus, said Emanuel was again putting the interests of billionaires and big corporations ahead of the needs of neighborhoods and taxpayers. Sara Burnett, The Christian Science Monitor, "Elon Musk to build high-speed transportation system in Chicago," 15 June 2018 Many Alaskans are most familiar with village public safety officers, or VPSOs, who must complete 240 hours of training and generally work for regional nonprofit corporations. Anchorage Daily News, "From criminal to cop, and back again, in Alaska’s most vulnerable villages," 9 June 2018 Anyone can publish open source code to GitHub for free; the platform makes money by charging individuals and corporations to keep their code private. Louise Matsakis, WIRED, "How Will Microsoft Handle GitHub's Controversial Code?," 5 June 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'corporation.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of corporation

15th century, in the meaning defined at sense 1b

History and Etymology for corporation

Middle English corporacion "organization into a body politic, an organized body of people," borrowed from Anglo-French & Late Latin; Anglo-French corporacion, borrowed from Late Latin corporātiōn-, corporātiō (Latin, "physical makeup"), from Latin corporāre "to form into a body" + -tiōn-, -tiō, suffix of action nouns — more at corporate

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Last Updated

26 Mar 2019

Look-up Popularity

Time Traveler for corporation

The first known use of corporation was in the 15th century

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More Definitions for corporation

corporation

noun

Financial Definition of corporation

What It Is

A corporation is one of many ways to formally organize a business. Structuring a business as a corporation has a number of important legal requirements and consequences that impact investors.

How It Works

A corporation is also sometimes referred to as a "C Corp." The "C" refers to the section of the IRS code that governs corporate taxes. Corporations have several distinguishing characteristics:

1. A corporation is owned by shareholders, and their ownership is represented by shares of stock.
2. A corporation has a board of directors, which is a group of people elected by the shareholders to oversee the corporation's management. The board of directors is elected to make decisions that are in the best interest of the shareholders.
3. A corporation has an unlimited life; that is, corporations don't die or expire unless a) the shareholders decide to intentionally dissolve the corporation or b) a corporation is unable to pay its debts and is forced into bankruptcy.
4. Shareholders have limited liability. That is, the liabilities of the corporation do not extend to the shareholders. If the corporation goes bankrupt or defaults on a loan, lenders cannot repossess shareholders' personal assets or try to force shareholders to repay the company's debts.
5. Corporations pay taxes on their income, even if they distribute some of that income directly to the shareholders via dividend payments. This leads to the controversial "double taxation."
6. Corporations are legal entities that exist separate and apart from their shareholders. In fact, they are usually afforded the legal rights of an individual person. That is, they can own assets, borrow money and sue or be sued.

Why It Matters

It's important to understand the characteristics of corporations because if you have money in the stock market, you are a shareholder and part owner of the corporations whose stock you own.

Corporations are the most popular form of business structure in the U.S. because of the limited liability protection. If the corporation can't pay back its loans, your shares will lose value (perhaps 100% of their value), but you as a shareholder are not responsible for paying back the debts. A shareholder cannot lose more than 100% of his or her investment.

If the corporation makes a profit, your shares in that company will become more valuable because as a shareholder, you're entitled to your portion of the net income. In fact, one of the main goals of a corporation's employees is to maximize shareholder value; that is, to work on behalf of the owners in order to enrich them as much as possible.

The corporate structure is not appropriate for every business. Corporations are highly governed, regulated and taxed when compared to other business forms (sole proprietorships or partnerships). This makes them more expensive to operate and conduct business. One of the largest complaints about the corporate structure is that profits are taxed twice: the corporation must pay income taxes and shareholders must pay income taxes on that same income if they receive a dividend payout (double taxation).

Source: Investing Answers

corporation

noun

English Language Learners Definition of corporation

: a large business or organization that under the law has the rights and duties of an individual and follows a specific purpose

corporation

noun
cor·​po·​ra·​tion | \ ˌkȯr-pə-ˈrā-shən How to pronounce corporation (audio) \

Kids Definition of corporation

: a business or organization authorized by law to carry on an activity with the rights and duties of a single person

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corporation

noun
cor·​po·​ra·​tion | \ ˌkȯr-pə-ˈrā-shən How to pronounce corporation (audio) \

Legal Definition of corporation

: an invisible, intangible, artificial creation of the law existing as a voluntary chartered association of individuals that has most of the rights and duties of natural persons but with perpetual existence and limited liability — see also pierce — compare association, partnership, sole proprietorship
benefit corporation
: a for-profit corporation whose purpose is to provide a benefit to society (such as improving the environment or promoting good health) in addition to making a profit for shareholders

called also B corporation, public benefit corporation

C corporation
: a corporation that pays taxes as a corporate entity — compare S corporation in this entry

Note: A corporation that does not choose to be an S corporation under the Internal Revenue Code is a C corporation.

close corporation \ ˈklōs-​ \
: a corporation whose shares are held by a small number of individuals (as management) and not publicly traded specifically : small business corporation in this entry

called also closely held corporation

— compare public corporation in this entry
foreign corporation
: a corporation organized under the laws of a state or government other than that in which it is doing business
government corporation
: public corporation in this entry
moneyed corporation
: a corporation (as a bank) authorized to engage in the investment, exchange, or lending of moneyed capital
municipal corporation
: a political unit created or otherwise given corporate status (as by a charter) by a superior governing authority (as a state) and endowed with powers of local self-government (as eminent domain) broadly : a public corporation (as a utility) created to act as an agency of administration and local self-government

Note: As a result of its incorporation, a municipal corporation has the capacity to sue and be sued. Citizens as well as officials are usually considered part of a municipal corporation.

professional corporation
: a corporation organized by one or more licensed individuals (as a doctor or lawyer) to provide professional services and obtain tax advantages
public corporation
1 : a government-owned corporation (as a utility or railroad) engaged in a profit-making enterprise that may require the exercise of powers unique to government (as eminent domain)

called also government corporation, publicly held corporation

2 : a business corporation whose stocks are publicly traded

called also publicly held corporation

— compare close corporation in this entry
S corporation
: a small business corporation that is treated for federal tax purposes as a partnership

called also subchapter S corporation

— compare c corporation in this entry
shell corporation
1 : a corporation that exists as a legal entity without independent assets or operations as an instrument by which another company or corporation can carry out dealings usually unrelated to its primary business
2 : a corporation formed for purposes of tax evasion or acquisition or merger rather than for a legitimate business purpose
small business corporation
: a corporation described in section 1361 of the Internal Revenue Code that has 35 shareholders or less and only one class of stock and that may if eligible elect to be an S corporation and taxed accordingly
subchapter S corporation
: s corporation in this entry

History and Etymology for corporation

Late Latin corporatio, from Latin corporare to form into a body, from corpor-, corpus body

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