Are most businesses organized as ‘traditional’ C-corporations?

Most well-known major companies, and all publicly traded companies on U.S. stock exchanges, are a type of corporation called a C-corporation. However, in 2015, 95% of businesses were actually so-called “pass-through” entities — accounting for 63% of all business income that year. Pass-through entities include sole proprietorships, S-corporations, and partnerships. Unlike C-corporations, whose profits are taxed at the corporate tax rate, the profits of pass-through entities are “passed through” to owners and taxed as owner’s income under the personal income tax. Pass-through entities enjoy more favorable tax treatment than C-corporations and this is one major reason why they are so prevalent. One study finds that the growth in pass-through entities since the 1980s cost the federal government $100 billion in tax revenue per year (before the 2017 Tax Cuts and Jobs Act).