Closed Corporation

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Closed Corporation

A type of business corporation that is owned and operated by a small group of people.

A closed corporation is also known as a close corporation, a family corporation, an incorporated partnership, and a chartered partnership. In this type of corporation all of the functions are usually performed by the same parties. These individuals serve as shareholders, officers, and directors and are involved in the management and operation of the business. A closed corporation differs from a publicly held corporation since its stock is neither issued nor traded to the public at large.

References in periodicals archive ?
An unrelated person would never pay more than a discount value for a minority interest in a closely held company.
59-60(3) outlined the approaches and methods typically considered when valuing a closely held company for estate and gift tax purposes.
In a family-held or closely held company, the dominant family member or largest shareholder may want to hold the chairman's post for monitoring reasons.
If there is no obvious buyer for a closely held company, the majority shareholder can sell his or her stock to a leveraged ESOP (explained later).
The sellers asserted the term "stock," as used in the securities acts, did not include the transfer of 100% of the stock of a closely held company.