Which is typically not a characteristic of an 'S' corporation?

The correct choice highlights that an S corporation typically does not have flexibility in ownership, which is a significant aspect of its structure. S corporations are distinct from C corporations because they have specific limitations on the number of shareholders they can have, which is limited to 100 individuals. Additionally, all shareholders must be U.S. citizens or residents, and they cannot have certain types of corporate shareholders. This limitation is designed to maintain the tax benefits of being an S corporation, such as avoiding double taxation.

In contrast, characteristics like limited liability, which shields shareholders from personal liability regarding corporate debts, and the benefit of no double taxation, where income is taxed only at the individual shareholder level rather than at the corporate level, are fundamental aspects of S corporations. The restrictions on shareholder numbers enhance the specific nature of S corporations that aims to promote localized and smaller business operations. Therefore, the limited flexibility in ownership arrangements is a defining characteristic that distinguishes S corporations from other business entity types.