The law treats a corporation as a legal "person" that has standing to sue and be sued, distinct from its stockholders. The legal independence of a corporation prevents shareholders from being personally liable for corporate debts. It also allows stockholders to sue the corporation through a derivative suit and makes ownership in the company (shares) easily transferable. The legal "person" status of corporations gives the business perpetual life; deaths of officials or stockholders do not alter the corporation's structure.
Corporations are taxable entities that fall under a different scheme from individuals. Although corporations have a "double tax" problem -- both corporate profits and shareholder dividends are taxed -- corporate profits are taxed at a lower rate than the rates for individuals.
Corporations | LII / Legal Information Institute