Final answer:
A close corporation, also known as a C Corporation, is a business structure that is small, with under 20 owners and under $500,000 in gross annual income. It is often used by family-owned businesses or small businesses that want to limit their ownership to a select group of people.
Step-by-step explanation:
To be a close corporation, the business must be small, with under 20 owners and under $500,000 in gross annual income. This type of business structure is called a C Corporation. A close corporation is a type of corporation that is closely held and has a limited number of shareholders. It is often used by family-owned businesses or small businesses that want to limit their ownership to a select group of people. Close corporations offer limited liability protection to their shareholders and have the flexibility to operate like a traditional corporation while enjoying certain benefits of partnerships or sole proprietorships.