A corporation is a legal entity that is separate from its owners, known as shareholders. It can own property, enter contracts, and be sued or sue in its own name. Corporations are created under state laws and can be either for-profit or non-profit, depending on their purpose. One key feature of a corporation is limited liability, which means that shareholders are not personally responsible for the corporation's debts. This structure allows individuals to invest in a business without risking their personal assets. Corporations are often managed by a board of directors, who make major decisions on behalf of the company.