How is a corporation defined legally?

A corporation is legally defined as a legal entity separate from its owners. This distinction is crucial because it means that a corporation has its own rights and obligations, separate from those of the individuals who own or control it. This separation allows a corporation to enter into contracts, sue or be sued, and own property independently of its shareholders.

The concept of limited liability is also a key aspect of this definition; shareholders are typically not personally responsible for the debts and liabilities of the corporation beyond their investment in shares. This legal structure provides protection to its owners, which is one of the primary reasons why individuals choose to incorporate their businesses.

In contrast, a partnership is a different legal structure where two or more individuals share ownership and responsibilities, and there is usually no separation of legal identity. A non-profit organization, while a type of corporation, is defined by its purpose to serve the public good rather than to generate profit for owners or shareholders. The term "group of shareholders" does describe a collection of individuals who may own a corporation, but it does not encompass the legal entity itself or address the implications of legal separation of the corporation.