{ "metadata": { "reviewed": "2026-10-11", "scope": "50-state selected statutory provisions for a small private domestic stock C corporation; described alternative forms are not separately scored. Primary-source tax profiles and qualified recurring minima, not a full case-law, charter, operating-tax or election-law audit.", "groupingRule": "Only the named normalized attribute is shared. No group claims identical statutes, exceptions, vote denominators, remedies or whole-state law. Unknowns are never evidence of equality.", "scoreRule": "Weighted preference index, not legal strength, investment value or lawsuit probability. Unknown inputs yield ranges. Sorted by confirmed lower score; rank bands account for overlapping ranges. Source dates and enactment-versus-compilation distinctions remain in individual records.", "weights": { "form": 20, "guards": 25, "reporting": 20, "fees": 15, "exit": 10, "accountability": 10 }, "exclusions": "Cost score includes the identified minimum tax/license scenario plus registry reports. Variable taxes, local costs, agents, one-time formation, court outcomes, insurance pricing and investor acceptance are not assigned fictional universal points.", "scoreVersion": "2026-10-11-recurring-tax-entry", "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "baselineCounts": { "benefitStates": 41, "annual": 38, "outsideStandard": 31, "noStateBenefitFiling": 28, "directorOnly": 34, "optIn": 42, "twoThirdsExit": 33 }, "costScenario": "A small, active, private stock C corporation, after its first tax year, using the lowest capital/receipts/share-count tier, no taxable income or taxable alternative-minimum base, and ordinary online filings where available. It operates in the state being compared. Yearly costs include registry reports and the identified minimum state tax/license charge; multi-year charges are annualized. Variable income, receipts, sales, payroll and local taxes, agents and one-time formation costs are additional.", "areas": { "form": "Benefit company option", "guards": "Personal protections", "reporting": "Less paperwork", "fees": "Yearly state costs and taxes", "exit": "Becoming a benefit company and changing back", "accountability": "Public transparency" } }, "states": [ { "state": "Alabama", "abbreviation": "AL", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "Responsible-and-sustainable statutory model", "features": { "purpose": { "summary": "Whole-society and environmental impact is required through the responsible-and-sustainable duty; identified charter public benefits are optional.", "generalRequired": null, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a7\u00a710A-2A-17.01(b),17.04(a)" } ] }, "board": { "summary": "Directors must act responsibly and sustainably, consider shareholders and known affected stakeholders, and pursue any identified charter benefit. No duty is owed solely to benefit beneficiaries.", "mode": "mandatory_responsible_sustainable_consider", "benefitDirectorRequired": "No separate benefit director required", "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.04(a)-(c)" } ] }, "standard": { "summary": "A third-party standard can be required by charter/bylaws or adopted by the board; it is optional by default. No statutory third-party certification requirement.", "thirdPartyRequired": false, "certificationRequired": false, "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.05(a)-(b)" } ] }, "report": { "summary": "Annual objectives, standards, facts and assessment; shareholders receive it or access notice by earlier of 120 days after fiscal year or ordinary annual reporting. All annual reports are public online; free latest copy on written request if no website. No state benefit-report filing in Article 17.", "cadence": "annual", "shareholders": true, "publicWebsite": "all annual reports", "stateFiling": false, "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.05" } ], "public": true }, "enforcement": { "summary": "Corporation or qualifying shareholder derivative suit: 5% of a class at the challenged act, or $5 million listed shares alternative; continued-ownership rules apply. Any shareholder may seek a missing report through expedited court relief.", "shareholderThreshold": "5% of a class; listed-company $5 million alternative", "directorStanding": false, "parentThreshold": null, "otherStanding": "Missing-report action available to any shareholder", "corporationStanding": true, "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a7\u00a717.05(e)-(f),17.06" } ] }, "benefitLiability": { "summary": "No standalone mission-failure damages bar in Article 17. Unless charter overrides, benefit-duty violation does not itself count as intentional harm for ordinary director exculpation/indemnification.", "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false, "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.04(d)" } ] }, "ordinaryExculpation": { "summary": "Effective August 1, 2026, charter may exculpate directors and covered officers against corporation/shareholder monetary claims except unentitled financial benefit, intentional harm and intentional criminal-law violation. Directors also retain unlawful-distribution liability; officers retain ALL claims by/in right of corporation. Covered senior officers and board-designated officers are defined.", "director": true, "officer": true, "automatic": false, "officerScope": "covered officers; claims by/in right of corporation excluded", "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2026RS/HB248-enr.pdf", "section": "Act 2026-495 \u00a71 amending \u00a710A-2A-2.02(b)(4),(h)-(i); effective \u00a78 August 1, 2026" }, { "url": "https://arc-sos.state.al.us/cgi/actdetail.mbr/detail?year=2026&act=495&page=year", "section": "Official signed-act registry: HB248; signed April 14, 2026; Act 2026-495" }, { "url": "https://arc-sos.state.al.us/ucp/L2121562.AI1.pdf", "section": "Signed Act 2026-495" } ] }, "statusChange": { "summary": "Entry and exit require at least two-thirds of votes entitled to be cast and each separately entitled voting group; affected-group transaction qualifications and higher charter votes apply.", "entryVote": "two-thirds; entitled voting groups", "exitVote": "two-thirds; entitled voting groups", "optionalLock": false, "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.03" } ] } }, "costs": { "regularReport": { "amount": 0, "currency": "USD", "cadence": "none", "conditions": "SOS annual-report requirement repealed effective October 1, 2024.", "summary": "SOS annual-report requirement repealed effective October 1, 2024.", "sources": [ { "url": "https://www.sos.alabama.gov/newsroom/secretary-state-wes-allen-applauds-final-passage-legislation-cutting-red-tape-alabama", "section": "HB230 annual-report repeal" } ] }, "benefitReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No state benefit-report filing imposed.", "summary": "No state benefit-report filing imposed.", "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.05" } ] }, "minimumTax": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "For 2026, calculated privilege tax of $100 or less is exempt with no BPT return. Above that threshold, adjusted/apportioned Alabama taxable net worth is multiplied by 0.025%\u20130.175%, selected by apportioned federal taxable income; credits and deductions affect the result. Ordinary C-corporation maximum is $15,000; financial/insurance rules differ.", "summary": "For 2026, calculated privilege tax of $100 or less is exempt with no BPT return. Above that threshold, adjusted/apportioned Alabama taxable net worth is multiplied by 0.025%\u20130.175%, selected by apportioned federal taxable income; credits and deductions affect the result. Ordinary C-corporation maximum is $15,000; financial/insurance rules differ.", "sources": [ { "url": "https://www.revenue.alabama.gov/notice-important-changes-to-the-2024-business-privilege-tax-filing-requirements/", "section": "2024 BPT exemption notice" }, { "url": "https://www.revenue.alabama.gov/wp-content/uploads/2026/01/26fcptblk.pdf", "section": "2026 Form CPT page 2, net-worth computation, apportionment, deductions and line 20 exemption" }, { "url": "https://www.revenue.alabama.gov/wp-content/uploads/2026/01/26fcptinstr.pdf", "section": "2026 Form CPT instructions pages 3\u20134: taxable-net-worth rate table, $100 exemption, ordinary corporation $15,000 maximum" }, { "label": "Alabama Department of Revenue: corporate income tax", "url": "https://www.revenue.alabama.gov/tax-types/corporate-income-tax/", "checked": "2026-10-11", "section": "Alabama Department of Revenue: corporate income tax" }, { "label": "Alabama Department of Revenue: 2026 CPT instructions and exemption", "url": "https://www.revenue.alabama.gov/wp-content/uploads/2026/01/26fcptinstr.pdf", "checked": "2026-10-11", "section": "Alabama Department of Revenue: 2026 CPT instructions and exemption" } ] } }, "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a7\u00a710A-2A-17.01(b),17.04(a)" }, { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.04(a)-(c)" }, { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.05(a)-(b)" }, { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.05" }, { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a7\u00a717.05(e)-(f),17.06" }, { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.04(d)" }, { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2026RS/HB248-enr.pdf", "section": "Act 2026-495 \u00a71 amending \u00a710A-2A-2.02(b)(4),(h)-(i); effective \u00a78 August 1, 2026" }, { "url": "https://arc-sos.state.al.us/cgi/actdetail.mbr/detail?year=2026&act=495&page=year", "section": "Official signed-act registry: HB248; signed April 14, 2026; Act 2026-495" }, { "url": "https://arc-sos.state.al.us/ucp/L2121562.AI1.pdf", "section": "Signed Act 2026-495" }, { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.03" }, { "url": "https://www.sos.alabama.gov/newsroom/secretary-state-wes-allen-applauds-final-passage-legislation-cutting-red-tape-alabama", "section": "HB230 annual-report repeal" }, { "url": "https://www.revenue.alabama.gov/notice-important-changes-to-the-2024-business-privilege-tax-filing-requirements/", "section": "2024 BPT exemption notice" }, { "url": "https://www.revenue.alabama.gov/wp-content/uploads/2026/01/26fcptblk.pdf", "section": "2026 Form CPT page 2, net-worth computation, apportionment, deductions and line 20 exemption" }, { "url": "https://www.revenue.alabama.gov/wp-content/uploads/2026/01/26fcptinstr.pdf", "section": "2026 Form CPT instructions pages 3\u20134: taxable-net-worth rate table, $100 exemption, ordinary corporation $15,000 maximum" }, { "label": "Alabama Department of Revenue: corporate income tax", "url": "https://www.revenue.alabama.gov/tax-types/corporate-income-tax/", "checked": "2026-10-11", "section": "Alabama Department of Revenue: corporate income tax" }, { "label": "Alabama Department of Revenue: 2026 CPT instructions and exemption", "url": "https://www.revenue.alabama.gov/wp-content/uploads/2026/01/26fcptinstr.pdf", "checked": "2026-10-11", "section": "Alabama Department of Revenue: 2026 CPT instructions and exemption" } ], "differences": [ "Optional external standard, but mandatory public annual reports.", "5% enforcement threshold is higher than the 2% model in several states.", "Annual SOS report eliminated; many older fee lists remain obsolete.", "2026 officer charter exculpation excludes corporation/derivative claims; broader director protection must be distinguished." ], "gaps": [], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "Benefit duties, reporting and status votes are sourced to the enacted 2020 Article 17 text. Ordinary charter exculpation uses signed Act 2026-495, effective August 1, 2026. Cost notes include the 2024 annual-report repeal and the Department of Revenue\u2019s 2026 CPT form and instructions.", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Alabama offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 12, 12 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Alabama has an identified director monetary-protection provision in the compared scope, which earns this credit. Effective August 1, 2026, charter may exculpate directors and covered officers against corporation/shareholder monetary claims except unentitled financial benefit, intentional harm and intentional criminal-law violation. Directors also retain unlawful-distribution liability; officers retain ALL claims by/in right of corporation. Covered senior officers and board-designated officers are defined.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 4, 4 ], "reason": "The model assigns 4 points to this designated eligible-officer provision; officer eligibility and excluded claims remain in the legal record.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Alabama extends ordinary protection to officers in a limited eligible-officer scope, so it receives less credit than the broader officer category. Effective August 1, 2026, charter may exculpate directors and covered officers against corporation/shareholder monetary claims except unentitled financial benefit, intentional harm and intentional criminal-law violation. Directors also retain unlawful-distribution liability; officers retain ALL claims by/in right of corporation. Covered senior officers and board-designated officers are defined.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Alabama requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit decision / classification safe harbor", "range": [ 2, 2 ], "reason": "2 points instead of the separate company/director/officer outcome-bar credits. The cited safe harbor is not treated as a blanket mission-failure damages bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection for benefit decisions", "why": "Alabama protects certain properly made or classified benefit decisions. This is narrower than an express company/director/officer bar on damages merely for missing the mission, so only the narrower safe-harbor credit applies. No standalone mission-failure damages bar in Article 17. Unless charter overrides, benefit-duty violation does not itself count as intentional harm for ordinary director exculpation/indemnification.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Alabama: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Alabama: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Alabama: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Alabama has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $0 = $0 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Alabama has a compared recurring floor of $0 per year, including $0 in identified minimum tax/license charges. Regular full year after formation, ordinary small domestic C corporation, no taxable profit, and adjusted/apportioned net worth low enough that privilege tax calculates to $100 or less. This is the express exemption scenario, not an assumption that all loss-making companies owe $0. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry and exit require at least two-thirds of votes entitled to be cast and each separately entitled voting group; affected-group transaction qualifications and higher charter votes apply.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Alabama: becoming a benefit company requires two-thirds; entitled voting groups. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Alabama: changing back requires two-thirds; entitled voting groups. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 17, 17 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Alabama requires report access for people outside the company, so it earns public-access credit. Annual objectives, standards, facts and assessment; shareholders receive it or access notice by earlier of 120 days after fiscal year or ordinary annual reporting. All annual reports are public online; free latest copy on written request if no website. No state benefit-report filing in Article 17.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Alabama: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Alabama: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Alabama makes a mission duty mandatory, so it earns this credit. Directors must act responsibly and sustainably, consider shareholders and known affected stakeholders, and pursue any identified charter benefit. No duty is owed solely to benefit beneficiaries.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 0, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 0, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 78, 78 ], "tax": { "code": "AL", "incomeSummary": "Ordinary C corporations pay 6.5% of Alabama net taxable income, with a deduction for federal income tax paid or accrued. Alabama has used single-sales-factor income apportionment since tax years beginning in 2021.", "recurringSummary": "Business privilege tax is based on adjusted Alabama-apportioned net worth, at $0.25\u2013$1.75 per $1,000 depending on apportioned federal taxable income. For 2026, calculated tax of $100 or less is exempt and no privilege-tax return is required; ordinary C corporations otherwise have a $15,000 maximum. Activity-specific business licenses may also apply.", "formationAnnualTaxFloor": null, "floorBasis": "No unconditional dollar floor is recorded: the former minimum has an exemption when calculated privilege tax is $100 or less. Exemption eligibility depends on the company's net-worth computation; formation alone does not establish a $0 total annual obligation. Registry fees, local licenses, property, sales and payroll taxes are outside this figure.", "scenarioMinimum": 0, "scenarioBasis": "Regular full year after formation, ordinary small domestic C corporation, no taxable profit, and adjusted/apportioned net worth low enough that privilege tax calculates to $100 or less. This is the express exemption scenario, not an assumption that all loss-making companies owe $0.", "operatingTaxCaution": "The 2026 CPT instructions use prior-year balance-sheet net worth and generally the income-tax apportionment factor. Nonresident activity can establish substantial nexus at the stated property, payroll, sales or 25% factor thresholds. Incorporating elsewhere does not remove Alabama obligations from Alabama operations.", "sources": [ { "label": "Alabama Department of Revenue: corporate income tax", "url": "https://www.revenue.alabama.gov/tax-types/corporate-income-tax/", "checked": "2026-10-11", "section": "Alabama Department of Revenue: corporate income tax" }, { "label": "Alabama Department of Revenue: 2026 CPT instructions and exemption", "url": "https://www.revenue.alabama.gov/wp-content/uploads/2026/01/26fcptinstr.pdf", "checked": "2026-10-11", "section": "Alabama Department of Revenue: 2026 CPT instructions and exemption" } ] }, "conversion": { "state": "Alabama", "code": "AL", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds; entitled voting groups", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry and exit require at least two-thirds of votes entitled to be cast and each separately entitled voting group; affected-group transaction qualifications and higher charter votes apply.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://alison.legislature.state.al.us/files/pdf/SearchableInstruments/2020RS/PrintFiles/HB202-Enr.pdf", "section": "\u00a717.03" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Whole-society and environmental impact is required through the responsible-and-sustainable duty; identified charter public benefits are optional.", "difference": "Alabama offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Effective August 1, 2026, charter may exculpate directors and covered officers against corporation/shareholder monetary claims except unentitled financial benefit, intentional harm and intentional criminal-law violation. Directors also retain unlawful-distribution liability; officers retain ALL claims by/in right of corporation. Covered senior officers and board-designated officers are defined. Benefit-specific rule: No standalone mission-failure damages bar in Article 17. Unless charter overrides, benefit-duty violation does not itself count as intentional harm for ordinary director exculpation/indemnification.", "difference": "Alabama adds ordinary officer coverage; the charter must elect the ordinary protection. 2026 officer charter exculpation excludes corporation/derivative claims; broader director protection must be distinguished." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual objectives, standards, facts and assessment; shareholders receive it or access notice by earlier of 120 days after fiscal year or ordinary annual reporting. All annual reports are public online; free latest copy on written request if no website. No state benefit-report filing in Article 17. Assessment rule: A third-party standard can be required by charter/bylaws or adopted by the board; it is optional by default. No statutory third-party certification requirement.", "difference": "Alabama: Annual; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $0 per year on an annualized basis. Minimum tax/license used here: $0. Regular full year after formation, ordinary small domestic C corporation, no taxable profit, and adjusted/apportioned net worth low enough that privilege tax calculates to $100 or less. This is the express exemption scenario, not an assumption that all loss-making companies owe $0.", "difference": "Alabama has a compared recurring floor of $0 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds; entitled voting groups. Entry and exit require at least two-thirds of votes entitled to be cast and each separately entitled voting group; affected-group transaction qualifications and higher charter votes apply. Changing back: two-thirds; entitled voting groups", "difference": "Alabama entry uses two-thirds; entitled voting groups; exit uses two-thirds; entitled voting groups. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must act responsibly and sustainably, consider shareholders and known affected stakeholders, and pursue any identified charter benefit. No duty is owed solely to benefit beneficiaries. Disclosure: Annual objectives, standards, facts and assessment; shareholders receive it or access notice by earlier of 120 days after fiscal year or ordinary annual reporting. All annual reports are public online; free latest copy on written request if no website. No state benefit-report filing in Article 17. Enforcement: Corporation or qualifying shareholder derivative suit: 5% of a class at the challenged act, or $5 million listed shares alternative; continued-ownership rules apply. Any shareholder may seek a missing report through expedited court relief.", "difference": "Alabama requires public access to the report. Optional external standard, but mandatory public annual reports. 5% enforcement threshold is higher than the 2% model in several states. Annual SOS report eliminated; many older fee lists remain obsolete." } } }, "guideUrl": "/assets/state-guides/AL.md" }, { "state": "Alaska", "abbreviation": "AK", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "reviewed": "2026-10-11", "family": "no dedicated form identified", "features": { "purpose": { "summary": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ], "generalRequired": null, "specificRequired": null, "specificOptional": null }, "board": { "summary": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ], "mode": "ordinary_corporation" }, "standard": { "summary": "No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ], "thirdPartyRequired": null, "certificationRequired": null }, "report": { "summary": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ], "cadence": "not_applicable", "shareholders": null, "publicWebsite": null, "stateFiling": null, "public": null }, "enforcement": { "summary": "No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ], "shareholderThreshold": "No dedicated benefit proceeding" }, "benefitLiability": { "summary": "No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "Director-only opt-in charter limitation; exceptions include loyalty, bad faith, intentional misconduct, knowing illegality, negligent/wilful unlawful dividends or repurchases and improper benefit.", "sources": [ { "url": "https://www.akleg.gov/statutesPDF/Title-10.pdf", "section": "AS 10.06.210(1)(M)" } ], "director": true, "officer": false, "automatic": false }, "statusChange": { "summary": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ], "entryVote": "not_applicable", "exitVote": "not_applicable", "optionalLock": false } }, "costs": { "regularReport": { "amount": 100, "cadence": "biennial", "conditions": "Domestic $100 biennial = $50 annualized; business license is additional.", "summary": "Domestic $100 biennial = $50 annualized; business license is additional.", "sources": [ { "url": "https://www.commerce.alaska.gov/web/cbpl/Corporations/BiennialReportsFAQs", "section": "Corporate report fees" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate statutory benefit form/report identified.", "summary": "No separate statutory benefit form/report identified.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ] }, "minimumTax": { "amount": 50, "conditions": "General Alaska business-license fee is $50 per year ($100 for two years), separate from the $100 biennial corporation report. Entity corporations do not qualify for sole-proprietor senior/veteran discounts. Income, sales/use and local obligations depend on the activity and location.", "summary": "General Alaska business-license fee is $50 per year ($100 for two years), separate from the $100 biennial corporation report. Entity corporations do not qualify for sole-proprietor senior/veteran discounts. Income, sales/use and local obligations depend on the activity and location.", "sources": [ { "url": "https://www.commerce.alaska.gov/web/cbpl/BusinessLicensing/BusinessLicensingFormsFees", "section": "Business license renewal fee" }, { "label": "Alaska DOR, 2025 Form 6000 instructions, revised January 1, 2026: rate table and multistate rules", "url": "https://tax.alaska.gov/programs/documentviewer/viewer.aspx?7531f", "checked": "2026-10-11", "section": "Alaska DOR, 2025 Form 6000 instructions, revised January 1, 2026: rate table and multistate rules" }, { "label": "Alaska Legislature, AS 43.20.011: corporate income rate schedule", "url": "https://www.akleg.gov/basis/statutes.asp?media=print&secStart=43.20.011&secEnd=43.20.011", "checked": "2026-10-11", "section": "Alaska Legislature, AS 43.20.011: corporate income rate schedule" }, { "label": "Alaska Commerce, business license application and renewal fees", "url": "https://www.commerce.alaska.gov/web/cbpl/BusinessLicensing/BusinessLicensingFormsFees", "checked": "2026-10-11", "section": "Alaska Commerce, business license application and renewal fees" }, { "label": "Alaska Commerce, business licensing statutes and regulations: ordinary fee and exceptions", "url": "https://www.commerce.alaska.gov/web/portals/5/pub/BusinessLicenseStatutes.pdf", "checked": "2026-10-11", "section": "Alaska Commerce, business licensing statutes and regulations: ordinary fee and exceptions" } ] } }, "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" }, { "url": "https://www.akleg.gov/statutesPDF/Title-10.pdf", "section": "AS 10.06.210(1)(M)" }, { "url": "https://www.commerce.alaska.gov/web/cbpl/Corporations/BiennialReportsFAQs", "section": "Corporate report fees" }, { "url": "https://www.commerce.alaska.gov/web/cbpl/BusinessLicensing/BusinessLicensingFormsFees", "section": "Business license renewal fee" }, { "label": "Alaska DOR, 2025 Form 6000 instructions, revised January 1, 2026: rate table and multistate rules", "url": "https://tax.alaska.gov/programs/documentviewer/viewer.aspx?7531f", "checked": "2026-10-11", "section": "Alaska DOR, 2025 Form 6000 instructions, revised January 1, 2026: rate table and multistate rules" }, { "label": "Alaska Legislature, AS 43.20.011: corporate income rate schedule", "url": "https://www.akleg.gov/basis/statutes.asp?media=print&secStart=43.20.011&secEnd=43.20.011", "checked": "2026-10-11", "section": "Alaska Legislature, AS 43.20.011: corporate income rate schedule" }, { "label": "Alaska Commerce, business license application and renewal fees", "url": "https://www.commerce.alaska.gov/web/cbpl/BusinessLicensing/BusinessLicensingFormsFees", "checked": "2026-10-11", "section": "Alaska Commerce, business license application and renewal fees" }, { "label": "Alaska Commerce, business licensing statutes and regulations: ordinary fee and exceptions", "url": "https://www.commerce.alaska.gov/web/portals/5/pub/BusinessLicenseStatutes.pdf", "checked": "2026-10-11", "section": "Alaska Commerce, business licensing statutes and regulations: ordinary fee and exceptions" } ], "differences": [ "Director-only opt-in charter limitation; exceptions include loyalty, bad faith, intentional misconduct, knowing illegality, negligent/wilful unlawful dividends or repurchases and improper benefit.", "Domestic $100 biennial = $50 annualized; business license is additional.", "The form-availability gap is the only shared grouping; ordinary protections and charges differ." ], "gaps": [ "Ordinary charter protections concern specified internal monetary claims; personally committed wrongs and liabilities imposed by other statutes remain separate." ], "confidence": "Current fee source; official ordinary-code verification where stated", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 0, 0 ], "reason": "No dedicated for-profit benefit form identified. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Alaska has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason. A nonprofit public-benefit corporation is a different entity and does not fill this for-profit gap.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 6, 6 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Alaska has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only opt-in charter limitation; exceptions include loyalty, bad faith, intentional misconduct, knowing illegality, negligent/wilful unlawful dividends or repurchases and improper benefit.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Alaska does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Alaska requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Alaska has no separately credited benefit-specific monetary shield for company. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Alaska has no separately credited benefit-specific monetary shield for directors. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Alaska has no separately credited benefit-specific monetary shield for officers. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 0, 0 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Alaska: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Alaska: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Alaska: No dedicated form. No dedicated benefit form means this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Alaska has no dedicated benefit form, so this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $50 + benefit filing $0 = $50 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Alaska has a compared recurring floor of $100 per year, including $50 in identified minimum tax/license charges. Ordinary domestic C corporation operating a general business in Alaska, one business name, regular license renewal year. Includes $50 state business license only; excludes registry charges and income, alternative minimum, payroll, property and local taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Alaska: becoming a benefit company requires No dedicated for-profit benefit election applies. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Alaska: changing back requires not_applicable. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Alaska has no dedicated benefit-report rule in this ordinary form, so it receives no benefit-publication credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Alaska: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Alaska: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Alaska has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 50.0, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "not_applicable", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 100.0, "minimumTaxAnnualized": 50, "entryCategory": "not_applicable" }, "grouping": { "assessment": "No dedicated form", "cadence": "No dedicated form", "filing": "No dedicated form", "ordinaryScope": "Director scope only", "exit": "No dedicated form" }, "scoreRange": [ 18, 18 ], "tax": { "code": "AK", "incomeSummary": "Corporate net income tax uses graduated marginal rates from 0% to 9.4% on Alaska taxable income: no regular tax below $25,000 and 9.4% on income above $222,000. Alternative minimum tax and special industry rules can apply.", "recurringSummary": "An ordinary business operating in Alaska needs a $50 annual state business license ($100 for two years), separate from the corporation's biennial registry report. License exemptions are activity-specific; sole-proprietor senior/veteran discounts do not establish a corporate discount.", "formationAnnualTaxFloor": null, "floorBasis": "Formation alone is not treated as proof of licensable Alaska business activity. The $50 operating license is sourced; registry fees and variable taxes are excluded.", "scenarioMinimum": 50, "scenarioBasis": "Ordinary domestic C corporation operating a general business in Alaska, one business name, regular license renewal year. Includes $50 state business license only; excludes registry charges and income, alternative minimum, payroll, property and local taxes.", "operatingTaxCaution": "Alaska-source income and nexus matter. Multistate corporations allocate/apportion income; incorporation elsewhere does not remove Alaska operating taxes. Other operating states can also impose taxes.", "sources": [ { "label": "Alaska DOR, 2025 Form 6000 instructions, revised January 1, 2026: rate table and multistate rules", "url": "https://tax.alaska.gov/programs/documentviewer/viewer.aspx?7531f", "checked": "2026-10-11", "section": "Alaska DOR, 2025 Form 6000 instructions, revised January 1, 2026: rate table and multistate rules" }, { "label": "Alaska Legislature, AS 43.20.011: corporate income rate schedule", "url": "https://www.akleg.gov/basis/statutes.asp?media=print&secStart=43.20.011&secEnd=43.20.011", "checked": "2026-10-11", "section": "Alaska Legislature, AS 43.20.011: corporate income rate schedule" }, { "label": "Alaska Commerce, business license application and renewal fees", "url": "https://www.commerce.alaska.gov/web/cbpl/BusinessLicensing/BusinessLicensingFormsFees", "checked": "2026-10-11", "section": "Alaska Commerce, business license application and renewal fees" }, { "label": "Alaska Commerce, business licensing statutes and regulations: ordinary fee and exceptions", "url": "https://www.commerce.alaska.gov/web/portals/5/pub/BusinessLicenseStatutes.pdf", "checked": "2026-10-11", "section": "Alaska Commerce, business licensing statutes and regulations: ordinary fee and exceptions" } ] }, "conversion": { "state": "Alaska", "code": "AK", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "group": "gap", "groupLabel": "Enact a benefit option", "entryVote": "No dedicated for-profit benefit election applies", "route": "No same-state benefit-status amendment route identified; a benefit chapter is needed. A move to another jurisdiction requires its own authorized domestication, conversion or merger route.", "currentDetail": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "proposal": "Enact a for-profit benefit chapter with a same-company amendment route, ordinary amendment voting and usable agency forms.", "sources": [ { "url": "https://www.akleg.gov/basis/statutes.asp#10", "section": "AS Title 10" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "difference": "Alaska has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only opt-in charter limitation; exceptions include loyalty, bad faith, intentional misconduct, knowing illegality, negligent/wilful unlawful dividends or repurchases and improper benefit. Benefit-specific rule: No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "difference": "Alaska keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Director-only opt-in charter limitation; exceptions include loyalty, bad faith, intentional misconduct, knowing illegality, negligent/wilful unlawful dividends or repurchases and improper benefit." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Assessment rule: No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "difference": "No benefit reporting credit applies because this state does not offer the requested form; that does not mean an ordinary company has no filings." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $50 per year on an annualized basis. Minimum tax/license used here: $50. Ordinary domestic C corporation operating a general business in Alaska, one business name, regular license renewal year. Includes $50 state business license only; excludes registry charges and income, alternative minimum, payroll, property and local taxes.", "difference": "Alaska has a compared recurring floor of $100 per year, including $50 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: No dedicated for-profit benefit election applies. Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules. Changing back: not_applicable", "difference": "No direct benefit-status election or exit exists in this state; an interstate move or a law change is a different process." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute. Disclosure: No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Enforcement: No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "difference": "The ordinary corporation has no dedicated statutory benefit duty/report in this reviewed form. That is why it receives no benefit-accountability credit." } } }, "guideUrl": "/assets/state-guides/AK.md" }, { "state": "Arizona", "abbreviation": "AZ", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "general-benefit model with distinct entry vote and commission filing", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a charter may add specific public benefits.", "sources": [ { "id": "AZ-purpose", "url": "https://www.azleg.gov/ars/10/02421.htm", "section": "\u00a710-2421", "claims": [ "General benefit required; specific benefit optional" ] } ] }, "board": { "model": "mandatory_stakeholder_consideration", "summary": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "sources": [ { "id": "AZ-directors", "url": "https://www.azleg.gov/ars/10/02431.htm", "section": "\u00a710-2431", "claims": [ "Mandatory stakeholder consideration; director benefit-failure shield; business-judgment safe harbor" ] } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "sources": [ { "id": "AZ-assessment", "url": "https://www.azleg.gov/ars/10/02441.htm", "section": "\u00a710-2441", "claims": [ "Annual independent-standard assessment; no required certification/audit" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": true, "deadline": "Within 120 days after fiscal year end; delivery is also specified with any other annual shareholder report. File with commission when delivered to shareholders.", "redactions": "Director compensation, financial or proprietary information may be omitted publicly and from the commission copy.", "summary": "Annual assessment to shareholders, all benefit reports on public website or free on request, plus a separate Arizona Corporation Commission filing.", "sources": [ { "id": "AZ-report", "url": "https://www.azleg.gov/ars/10/02442.htm", "section": "\u00a710-2442", "claims": [ "Shareholder/public/commission report and permitted redactions" ] } ] }, "enforcement": { "threshold": "2% of total outstanding shares, all classes combined, held at the act or omission; director; 5% owner of parent; other persons named in articles/bylaws.", "summary": "The corporation can sue directly. Shareholder derivative standing generally requires 2% total ownership; it is not the 2%-of-one-class formulation.", "sources": [ { "id": "AZ-enforcement", "url": "https://www.azleg.gov/ars/10/02433.htm", "section": "\u00a710-2433", "claims": [ "2% total derivative standing and company benefit-failure shield" ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to pursue or create benefit.", "directors": "Default bar for failure to pursue or create benefit, unless articles/bylaws provide otherwise. Informed, disinterested, good-faith rational business judgments satisfy the special duty.", "officers": "Parallel default benefit-failure bar and business-judgment safe harbor; conditional stakeholder consideration when the officer has discretion and material benefit impact is apparent.", "summary": "The benefit-failure shield is narrower in its wording than statutes expressly barring every compliant benefit-duty action. Ordinary conduct standards still apply.", "sources": [ { "id": "AZ-directors", "url": "https://www.azleg.gov/ars/10/02431.htm", "section": "\u00a710-2431", "claims": [ "Mandatory stakeholder consideration; director benefit-failure shield; business-judgment safe harbor" ] }, { "id": "AZ-officers", "url": "https://www.azleg.gov/ars/10/02432.htm", "section": "\u00a710-2432", "claims": [ "Officer conditional duty, benefit-failure shield and business-judgment test" ] }, { "id": "AZ-enforcement", "url": "https://www.azleg.gov/ars/10/02433.htm", "section": "\u00a710-2433", "claims": [ "2% total derivative standing and company benefit-failure shield" ] } ] }, "ordinaryExculpation": { "scope": "directors", "activation": "Opt-in articles of incorporation.", "exceptions": [ "Improper financial benefit", "Intentional infliction of harm", "Specified unlawful distributions", "Intentional criminal-law violation", "Acts before the provision becomes effective" ], "summary": "Charter can limit directors\u2019 monetary liability to corporation/shareholders, subject to improper benefit, intentional harm, unlawful distributions and intentional criminal-law violations. No general officer extension in \u00a710-202(B)(1).", "sources": [ { "id": "AZ-ordinary", "url": "https://www.azleg.gov/ars/10/00202.htm", "section": "\u00a710-202(B)(1)", "claims": [ "Director charter exculpation and exceptions" ] } ] }, "statusChange": { "entryVote": "At least three quarters of every class or series, including otherwise nonvoting shares.", "exitVote": "At least two thirds of every class or series, including otherwise nonvoting shares.", "lock": "No unconditional statutory permanent lock identified.", "summary": "Entry is harder than exit: a 75% class vote to become a benefit corporation, 66\u2154% class vote to terminate.", "sources": [ { "id": "AZ-votes", "url": "https://www.azleg.gov/ars/10/02402.htm", "section": "\u00a710-2402; \u00a7\u00a710-2404\u20132405", "claims": [ "Supermajority is three quarters each class; minimum status vote is two thirds each class" ] }, { "id": "AZ-entry", "url": "https://www.azleg.gov/ars/10/02404.htm", "section": "\u00a710-2404", "claims": [ "Entry requires supermajority status vote" ] }, { "id": "AZ-exit", "url": "https://www.azleg.gov/ars/10/02405.htm", "section": "\u00a710-2405", "claims": [ "Exit requires minimum status vote" ] } ] } }, "costs": { "regularReport": { "amount": 45, "cadence": "annual", "conditions": "Domestic for-profit normal annual report, regular processing.", "summary": "Domestic for-profit normal annual report, regular processing.", "sources": [ { "id": "AZ-fees", "url": "https://azcc.gov/docs/default-source/corps-files/fee-schedules/fee-schedule-corporations6def4cc74b1a47129d16c2b1c3851bda.pdf?sfvrsn=2d6fbddb_5", "section": "2026 fee schedule, annual report rows", "claims": [ "$45 ordinary annual report and $10 additional benefit report" ] } ] }, "benefitReport": { "amount": 10, "cadence": "annual", "conditions": "Separate annual benefit report fee; additional to normal annual report.", "summary": "Separate annual benefit report fee; additional to normal annual report.", "sources": [ { "id": "AZ-report", "url": "https://www.azleg.gov/ars/10/02442.htm", "section": "\u00a710-2442", "claims": [ "Shareholder/public/commission report and permitted redactions" ] }, { "id": "AZ-fees", "url": "https://azcc.gov/docs/default-source/corps-files/fee-schedules/fee-schedule-corporations6def4cc74b1a47129d16c2b1c3851bda.pdf?sfvrsn=2d6fbddb_5", "section": "2026 fee schedule, annual report rows", "claims": [ "$45 ordinary annual report and $10 additional benefit report" ] } ] }, "minimumTax": { "amount": 50, "cadence": "annual", "conditions": "Corporate income-tax minimum, not a formation fee: every corporation required to file Form 120 pays at least $50 under \u00a743-1111. Income-based tax, exemptions and nexus rules determine the rest. Benefit status does not confer tax exemption.", "summary": "Corporate income-tax minimum, not a formation fee: every corporation required to file Form 120 pays at least $50 under \u00a743-1111. Income-based tax, exemptions and nexus rules determine the rest. Benefit status does not confer tax exemption.", "sources": [ { "id": "AZ-tax-minimum", "url": "https://azdor.gov/forms/corporate-tax-forms/arizona-corporation-income-tax-return", "section": "Form 120 page; A.R.S.\u00a743-1111", "claims": [ "$50 corporate income-tax minimum for corporations required to file." ] }, { "id": "AZ-tax-applicability", "url": "https://azdor.gov/business/corporate-income-tax", "section": "Corporate income-tax filing requirements", "claims": [ "Corporations subject to Arizona Income Tax Act must file; taxable income and filing status matter." ] }, { "label": "Arizona Legislature, A.R.S. 43-1111: 4.9% rate and $50 minimum", "url": "https://www.azleg.gov/ars/43/01111.htm", "checked": "2026-10-11", "section": "Arizona Legislature, A.R.S. 43-1111: 4.9% rate and $50 minimum" }, { "label": "Arizona DOR, Form 120: minimum for corporations required to file", "url": "https://azdor.gov/forms/corporate-tax-forms/arizona-corporation-income-tax-return", "checked": "2026-10-11", "section": "Arizona DOR, Form 120: minimum for corporations required to file" }, { "label": "Arizona DOR, 2025 Form 120 instructions: classification and apportionment", "url": "https://azdor.gov/sites/default/files/document/FORMS_CORPORATE_2025_120_i.pdf", "checked": "2026-10-11", "section": "Arizona DOR, 2025 Form 120 instructions: classification and apportionment" } ] } }, "sources": [ { "id": "AZ-purpose", "url": "https://www.azleg.gov/ars/10/02421.htm", "section": "\u00a710-2421", "claims": [ "General benefit required; specific benefit optional" ] }, { "id": "AZ-votes", "url": "https://www.azleg.gov/ars/10/02402.htm", "section": "\u00a710-2402; \u00a7\u00a710-2404\u20132405", "claims": [ "Supermajority is three quarters each class; minimum status vote is two thirds each class" ] }, { "id": "AZ-entry", "url": "https://www.azleg.gov/ars/10/02404.htm", "section": "\u00a710-2404", "claims": [ "Entry requires supermajority status vote" ] }, { "id": "AZ-exit", "url": "https://www.azleg.gov/ars/10/02405.htm", "section": "\u00a710-2405", "claims": [ "Exit requires minimum status vote" ] }, { "id": "AZ-directors", "url": "https://www.azleg.gov/ars/10/02431.htm", "section": "\u00a710-2431", "claims": [ "Mandatory stakeholder consideration; director benefit-failure shield; business-judgment safe harbor" ] }, { "id": "AZ-officers", "url": "https://www.azleg.gov/ars/10/02432.htm", "section": "\u00a710-2432", "claims": [ "Officer conditional duty, benefit-failure shield and business-judgment test" ] }, { "id": "AZ-enforcement", "url": "https://www.azleg.gov/ars/10/02433.htm", "section": "\u00a710-2433", "claims": [ "2% total derivative standing and company benefit-failure shield" ] }, { "id": "AZ-assessment", "url": "https://www.azleg.gov/ars/10/02441.htm", "section": "\u00a710-2441", "claims": [ "Annual independent-standard assessment; no required certification/audit" ] }, { "id": "AZ-report", "url": "https://www.azleg.gov/ars/10/02442.htm", "section": "\u00a710-2442", "claims": [ "Shareholder/public/commission report and permitted redactions" ] }, { "id": "AZ-ordinary", "url": "https://www.azleg.gov/ars/10/00202.htm", "section": "\u00a710-202(B)(1)", "claims": [ "Director charter exculpation and exceptions" ] }, { "id": "AZ-default", "url": "https://www.azleg.gov/ars/10/02401.htm", "section": "\u00a710-2401(F)", "claims": [ "Ordinary corporation default benefit powers and discretionary consideration" ] }, { "id": "AZ-fees", "url": "https://azcc.gov/docs/default-source/corps-files/fee-schedules/fee-schedule-corporations6def4cc74b1a47129d16c2b1c3851bda.pdf?sfvrsn=2d6fbddb_5", "section": "2026 fee schedule, annual report rows", "claims": [ "$45 ordinary annual report and $10 additional benefit report" ] }, { "id": "AZ-tax-minimum", "url": "https://azdor.gov/forms/corporate-tax-forms/arizona-corporation-income-tax-return", "section": "Form 120 page; A.R.S.\u00a743-1111", "claims": [ "$50 corporate income-tax minimum for corporations required to file." ] }, { "id": "AZ-tax-applicability", "url": "https://azdor.gov/business/corporate-income-tax", "section": "Corporate income-tax filing requirements", "claims": [ "Corporations subject to Arizona Income Tax Act must file; taxable income and filing status matter." ] }, { "label": "Arizona Legislature, A.R.S. 43-1111: 4.9% rate and $50 minimum", "url": "https://www.azleg.gov/ars/43/01111.htm", "checked": "2026-10-11", "section": "Arizona Legislature, A.R.S. 43-1111: 4.9% rate and $50 minimum" }, { "label": "Arizona DOR, Form 120: minimum for corporations required to file", "url": "https://azdor.gov/forms/corporate-tax-forms/arizona-corporation-income-tax-return", "checked": "2026-10-11", "section": "Arizona DOR, Form 120: minimum for corporations required to file" }, { "label": "Arizona DOR, 2025 Form 120 instructions: classification and apportionment", "url": "https://azdor.gov/sites/default/files/document/FORMS_CORPORATE_2025_120_i.pdf", "checked": "2026-10-11", "section": "Arizona DOR, 2025 Form 120 instructions: classification and apportionment" } ], "differences": [ "Three-quarter entry vote differs from the usual two-thirds model.", "Benefit report is filed with the commission as well as shared publicly.", "Ordinary Arizona corporations already have broad default powers to pursue benefit and consider stakeholders under \u00a710-2401(F); benefit designation makes specified duties mandatory." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "Current online code reviewed; fee schedule expressly revised 2026." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Arizona offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Arizona has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter can limit directors\u2019 monetary liability to corporation/shareholders, subject to improper benefit, intentional harm, unlawful distributions and intentional criminal-law violations. No general officer extension in \u00a710-202(B)(1).", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Arizona does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Arizona requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Arizona earns the benefit-specific credit for company. The benefit-failure shield is narrower in its wording than statutes expressly barring every compliant benefit-duty action. Ordinary conduct standards still apply.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Arizona earns the benefit-specific credit for directors. The benefit-failure shield is narrower in its wording than statutes expressly barring every compliant benefit-duty action. Ordinary conduct standards still apply.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Arizona earns the benefit-specific credit for officers. The benefit-failure shield is narrower in its wording than statutes expressly barring every compliant benefit-duty action. Ordinary conduct standards still apply.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Arizona: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Arizona: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Arizona: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Arizona has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 9, 9 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 9, 9 ], "reason": "Ordinary reporting $45 + benefit filing $10 = $55 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Arizona has a compared recurring floor of $105 per year, including $50 in identified minimum tax/license charges. Ordinary domestic C corporation actually operating in Arizona, required to file, no taxable net profit, no special exemption or credit assumption. Includes $50 corporate minimum; excludes registry fees and variable operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 10, 10 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 4, 4 ], "reason": "Entry is harder than exit: a 75% class vote to become a benefit corporation, 66\u2154% class vote to terminate.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Arizona: becoming a benefit company requires At least three quarters of every class or series, including otherwise nonvoting shares. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Entry is harder than exit: a 75% class vote to become a benefit corporation, 66\u2154% class vote to terminate.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Arizona: changing back requires At least two thirds of every class or series, including otherwise nonvoting shares. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Entry is harder than exit: a 75% class vote to become a benefit corporation, 66\u2154% class vote to terminate.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Arizona requires report access for people outside the company, so it earns public-access credit. Annual assessment to shareholders, all benefit reports on public website or free on request, plus a separate Arizona Corporation Commission filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Arizona: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Arizona: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Arizona makes a mission duty mandatory, so it earns this credit. Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 55, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 105, "minimumTaxAnnualized": 50, "entryCategory": "three_quarters" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 69, 69 ], "tax": { "code": "AZ", "incomeSummary": "General C-corporation income tax is the greater of 4.9% of Arizona taxable net income or $50. The minimum applies to corporations required to file an Arizona return; S-corporation and exempt-entity rules differ.", "recurringSummary": "The $50 annual corporate income-tax minimum is separate from registry annual-report and benefit-report charges. It is a tax-return minimum, not a formation fee.", "formationAnnualTaxFloor": null, "floorBasis": "The agency and statute establish $50 for corporations required to file; this field does not assert that mere incorporation, without examining tax applicability, independently triggers it. Registry fees are excluded.", "scenarioMinimum": 50, "scenarioBasis": "Ordinary domestic C corporation actually operating in Arizona, required to file, no taxable net profit, no special exemption or credit assumption. Includes $50 corporate minimum; excludes registry fees and variable operating taxes.", "operatingTaxCaution": "A multistate corporation allocates and apportions income attributable to Arizona. Nexus, federal protections and classification affect filing; formation in another state does not remove Arizona business obligations.", "sources": [ { "label": "Arizona Legislature, A.R.S. 43-1111: 4.9% rate and $50 minimum", "url": "https://www.azleg.gov/ars/43/01111.htm", "checked": "2026-10-11", "section": "Arizona Legislature, A.R.S. 43-1111: 4.9% rate and $50 minimum" }, { "label": "Arizona DOR, Form 120: minimum for corporations required to file", "url": "https://azdor.gov/forms/corporate-tax-forms/arizona-corporation-income-tax-return", "checked": "2026-10-11", "section": "Arizona DOR, Form 120: minimum for corporations required to file" }, { "label": "Arizona DOR, 2025 Form 120 instructions: classification and apportionment", "url": "https://azdor.gov/sites/default/files/document/FORMS_CORPORATE_2025_120_i.pdf", "checked": "2026-10-11", "section": "Arizona DOR, 2025 Form 120 instructions: classification and apportionment" } ] }, "conversion": { "state": "Arizona", "code": "AZ", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "At least three quarters of every class or series, including otherwise nonvoting shares.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry is harder than exit: a 75% class vote to become a benefit corporation, 66\u2154% class vote to terminate.", "proposal": "Reduce the 75% entry requirement separately from the lower exit requirement; identify every class entitled to approve.", "sources": [ { "id": "AZ-votes", "url": "https://www.azleg.gov/ars/10/02402.htm", "section": "\u00a710-2402; \u00a7\u00a710-2404\u20132405", "claims": [ "Supermajority is three quarters each class; minimum status vote is two thirds each class" ] }, { "id": "AZ-entry", "url": "https://www.azleg.gov/ars/10/02404.htm", "section": "\u00a710-2404", "claims": [ "Entry requires supermajority status vote" ] }, { "id": "AZ-exit", "url": "https://www.azleg.gov/ars/10/02405.htm", "section": "\u00a710-2405", "claims": [ "Exit requires minimum status vote" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a charter may add specific public benefits.", "difference": "Arizona offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter can limit directors\u2019 monetary liability to corporation/shareholders, subject to improper benefit, intentional harm, unlawful distributions and intentional criminal-law violations. No general officer extension in \u00a710-202(B)(1). Benefit-specific rule: The benefit-failure shield is narrower in its wording than statutes expressly barring every compliant benefit-duty action. Ordinary conduct standards still apply.", "difference": "Arizona keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. " }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual assessment to shareholders, all benefit reports on public website or free on request, plus a separate Arizona Corporation Commission filing. Assessment rule: Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "difference": "Arizona: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $55 per year on an annualized basis. Minimum tax/license used here: $50. Ordinary domestic C corporation actually operating in Arizona, required to file, no taxable net profit, no special exemption or credit assumption. Includes $50 corporate minimum; excludes registry fees and variable operating taxes.", "difference": "Arizona has a compared recurring floor of $105 per year, including $50 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: At least three quarters of every class or series, including otherwise nonvoting shares. Entry is harder than exit: a 75% class vote to become a benefit corporation, 66\u2154% class vote to terminate. Changing back: At least two thirds of every class or series, including otherwise nonvoting shares.", "difference": "Arizona entry uses At least three quarters of every class or series, including otherwise nonvoting shares.; exit uses At least two thirds of every class or series, including otherwise nonvoting shares.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities. Disclosure: Annual assessment to shareholders, all benefit reports on public website or free on request, plus a separate Arizona Corporation Commission filing. Enforcement: The corporation can sue directly. Shareholder derivative standing generally requires 2% total ownership; it is not the 2%-of-one-class formulation.", "difference": "Arizona requires public access to the report. Benefit report is filed with the commission as well as shared publicly." } } }, "guideUrl": "/assets/state-guides/AZ.md" }, { "state": "Arkansas", "abbreviation": "AR", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit mandatory stakeholder model; state-filed report", "features": { "purpose": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-201" } ], "confidence": "medium", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a specific benefit may be added without replacing the general purpose." }, "board": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-301(a); 4-36-302" } ], "confidence": "medium", "mode": "mandatory_stakeholder_consideration", "summary": "Directors must consider the listed shareholders, workforce, customers, communities, environment, long-term interests and benefit purposes; priority may be set in articles. Benefit director is optional and ordinarily independent." }, "standard": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(a)(2)(B)" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(a)(2)(B)(ii)" } ], "confidence": "medium", "required": true, "summary": "Annual social/environmental assessment must use a third-party standard. Assessment need not be performed, audited or certified by the standard provider.", "thirdPartyRequired": true, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(a)(2)(B)(ii)" } ], "confidence": "medium", "required": false, "summary": "Assessment need not be performed, audited or certified by the standard provider." }, "report": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(b)-(e)" } ], "confidence": "medium", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": true, "summary": "Annual report goes to shareholders before franchise-tax due date or with annual financial report, is published on public website (all reports; latest free copy if no website), and concurrently filed with Secretary of State; specified compensation/proprietary information may be removed." }, "enforcement": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-305(c)" } ], "confidence": "medium", "threshold": "any_shareholder", "summary": "Corporation directly; derivatively any shareholder, director, 5% parent-equity holders, or charter/bylaw designees. No minimum corporation-share percentage for its own shareholder." }, "benefitLiability": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-301(c); 4-36-302(g); 4-36-303(c); 4-36-305(b)" } ], "confidence": "medium", "company": true, "directors": true, "officers": true, "summary": "Company cannot owe monetary damages under benefit chapter for benefit failure. Directors and officers have benefit-failure monetary protection and protection for compliant acts; special benefit director exceptions include self-dealing, willful misconduct and knowing law violations." }, "ordinaryExculpation": { "sources": [ { "url": "https://arkleg.state.ar.us/Acts/FTPDocument?ddBienniumSession=1987%2FR&file=958.pdf&path=%2FACTS%2F1987%2FPublic%2F", "section": "Act 958 of 1987, \u00a764-202(B)(3), PDF page 8; codified Ark. Code \u00a74-27-202(b)(3)" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2007%2FPublic%2FACT638.pdf", "section": "Act 638 of 2007, \u00a76, PDF pages 18\u201319: amendment only to \u00a74-27-202(a)" }, { "url": "https://arkleg.state.ar.us/Acts/FTPDocument?ddBienniumSession=2019%2F2019R&file=108.pdf&path=%2FACTS%2F2019R%2FPublic%2F", "section": "Act 108 of 2019, \u00a71, PDF page 1: added only \u00a74-27-202(d)" }, { "url": "https://arkleg.state.ar.us/Acts/CodeSection?section=4&ddBienniumSession=2025%2F2025R", "section": "Official 2025 regular-session Title 4 amendment index: no \u00a74-27-202 amendment; only \u00a74-27-140(17) in Chapter 27" }, { "url": "https://arkleg.state.ar.us/Acts/CodeSection?section=4&ddBienniumSession=2025%2F2026F", "section": "Official 2026 fiscal-session Title 4 amendment index: no amended code in Title 4" } ], "confidence": "high", "director": true, "officer": false, "optIn": true, "automatic": false, "scope": "Monetary damages for fiduciary breaches as a director owed to the corporation or its stockholders; not third-party claims.", "exceptions": [ "Breach of loyalty to the corporation or its stockholders", "Acts or omissions in bad faith; intentional misconduct; knowing law violations", "Unlawful distributions: original Act 958 \u00a764-821, codified \u00a74-27-833", "Transaction yielding an improper personal benefit", "Any action, omission, transaction or duty breach creating liability to someone other than the corporation or stockholder" ], "retroactive": false, "nonstockDirectorIncluded": true, "ordinaryOfficerNote": "Officer protection under standards-of-conduct or indemnification provisions is a different mechanism. The officer=false flag here describes the \u00a74-27-202(b)(3) charter clause only.", "summary": "Articles may eliminate or limit directors\u2019 personal liability to the corporation or stockholders for monetary fiduciary-duty damages. Officers are outside this charter authorization. Exceptions preserve loyalty breaches, bad faith, intentional misconduct, knowing law violations, unlawful distributions, improper personal benefit, and any third-party liability. Protection starts when the charter clause takes effect; earlier acts remain exposed." }, "statusChange": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-103; 4-36-105; 4-36-106" } ], "confidence": "medium", "entry": "2/3 each class/series", "exit": "2/3 each class/series", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "Entry, exit and covered fundamental transactions require 2/3 of each class/series, including otherwise nonvoting shares. Nonordinary sale of all/substantially all assets also requires minimum vote.", "exitVote": "2/3 each class/series", "entryVote": "2/3 each class/series" } }, "costs": { "regularReport": { "sources": [ { "url": "https://www.sos.arkansas.gov/business-commercial-services-bcs/franchise-tax-report-forms/", "section": "Franchise tax forms and instructions" } ], "confidence": "high", "amount": 0, "cadence": "annual", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "The annual corporation franchise-tax report is filed with the franchise tax; there is no separately listed original annual report charge. Minimum franchise tax is $150 below, counted once. Optional online payment processing charges and late penalties are separate.", "conditions": "The annual corporation franchise-tax report is filed with the franchise tax; there is no separately listed original annual report charge. Minimum franchise tax is $150 below, counted once. Optional online payment processing charges and late penalties are separate." }, "benefitReport": { "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(e)(3)" } ], "confidence": "medium", "amount": 70, "cadence": "annual", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Separate annual benefit-report state filing fee is $70 in enacted statute.", "conditions": "Separate annual benefit-report state filing fee is $70 in enacted statute." }, "minimumTax": { "sources": [ { "url": "https://www.sos.arkansas.gov/business-commercial-services-bcs/franchise-tax-report-forms/", "section": "Stock corporation annual franchise tax" }, { "label": "Arkansas DFA: 2025 C Corporation Income Tax Instructions, 2024-forward rates and 2026 sourcing/nexus changes", "url": "https://www.dfa.arkansas.gov/wp-content/uploads/CorporationIncomeTaxInstructions_2025.pdf", "checked": "2026-10-11", "section": "Arkansas DFA: 2025 C Corporation Income Tax Instructions, 2024-forward rates and 2026 sourcing/nexus changes" }, { "label": "Arkansas Secretary of State: 2026 stock-corporation franchise report and calculation", "url": "https://www.sos.arkansas.gov/uploads/bcs/Corp1_FT_2026.pdf", "checked": "2026-10-11", "section": "Arkansas Secretary of State: 2026 stock-corporation franchise report and calculation" }, { "label": "Arkansas Secretary of State: annual franchise tax applicability and current forms", "url": "https://www.sos.arkansas.gov/business-commercial-services-bcs/franchise-tax-report-forms/", "checked": "2026-10-11", "section": "Arkansas Secretary of State: annual franchise tax applicability and current forms" } ], "confidence": "high", "amount": 150, "cadence": "annual", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Minimum annual franchise tax for a stock corporation is $150; tax may increase with taxable capital. Nonstock corporation amount differs.", "conditions": "Minimum annual franchise tax for a stock corporation is $150; tax may increase with taxable capital. Nonstock corporation amount differs." } }, "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-201" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-301(a); 4-36-302" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(a)(2)(B)" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(a)(2)(B)(ii)" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(b)-(e)" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-305(c)" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-301(c); 4-36-302(g); 4-36-303(c); 4-36-305(b)" }, { "url": "https://arkleg.state.ar.us/Acts/FTPDocument?ddBienniumSession=1987%2FR&file=958.pdf&path=%2FACTS%2F1987%2FPublic%2F", "section": "Act 958 of 1987, \u00a764-202(B)(3), PDF page 8; codified Ark. Code \u00a74-27-202(b)(3)" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=%2FACTS%2F2007%2FPublic%2FACT638.pdf", "section": "Act 638 of 2007, \u00a76, PDF pages 18\u201319: amendment only to \u00a74-27-202(a)" }, { "url": "https://arkleg.state.ar.us/Acts/FTPDocument?ddBienniumSession=2019%2F2019R&file=108.pdf&path=%2FACTS%2F2019R%2FPublic%2F", "section": "Act 108 of 2019, \u00a71, PDF page 1: added only \u00a74-27-202(d)" }, { "url": "https://arkleg.state.ar.us/Acts/CodeSection?section=4&ddBienniumSession=2025%2F2025R", "section": "Official 2025 regular-session Title 4 amendment index: no \u00a74-27-202 amendment; only \u00a74-27-140(17) in Chapter 27" }, { "url": "https://arkleg.state.ar.us/Acts/CodeSection?section=4&ddBienniumSession=2025%2F2026F", "section": "Official 2026 fiscal-session Title 4 amendment index: no amended code in Title 4" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-103; 4-36-105; 4-36-106" }, { "url": "https://www.sos.arkansas.gov/business-commercial-services-bcs/franchise-tax-report-forms/", "section": "Franchise tax forms and instructions" }, { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-401(e)(3)" }, { "url": "https://www.sos.arkansas.gov/business-commercial-services-bcs/franchise-tax-report-forms/", "section": "Stock corporation annual franchise tax" }, { "label": "Arkansas DFA: 2025 C Corporation Income Tax Instructions, 2024-forward rates and 2026 sourcing/nexus changes", "url": "https://www.dfa.arkansas.gov/wp-content/uploads/CorporationIncomeTaxInstructions_2025.pdf", "checked": "2026-10-11", "section": "Arkansas DFA: 2025 C Corporation Income Tax Instructions, 2024-forward rates and 2026 sourcing/nexus changes" }, { "label": "Arkansas Secretary of State: 2026 stock-corporation franchise report and calculation", "url": "https://www.sos.arkansas.gov/uploads/bcs/Corp1_FT_2026.pdf", "checked": "2026-10-11", "section": "Arkansas Secretary of State: 2026 stock-corporation franchise report and calculation" }, { "label": "Arkansas Secretary of State: annual franchise tax applicability and current forms", "url": "https://www.sos.arkansas.gov/business-commercial-services-bcs/franchise-tax-report-forms/", "checked": "2026-10-11", "section": "Arkansas Secretary of State: annual franchise tax applicability and current forms" } ], "differences": [ "Separate $70 state benefit-report filing fee.", "Any shareholder can bring a benefit derivative claim; no 2% floor.", "Independent benefit director is optional.", "Arkansas expressly excludes all third-party liability from this ordinary director charter protection." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "Benefit provisions read in enacted Act 1388 (2013), with current SOS January 2025 benefit corporation articles confirming availability. Ordinary clause verified in official Act 958 (1987), 2007/2019 amendment texts and official legislative amendment indexes through the 2026 fiscal session.", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Arkansas offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Arkansas has an identified director monetary-protection provision in the compared scope, which earns this credit. Articles may eliminate or limit directors\u2019 personal liability to the corporation or stockholders for monetary fiduciary-duty damages. Officers are outside this charter authorization. Exceptions preserve loyalty breaches, bad faith, intentional misconduct, knowing law violations, unlawful distributions, improper personal benefit, and any third-party liability. Protection starts when the charter clause takes effect; earlier acts remain exposed.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Arkansas does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Arkansas requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Arkansas earns the benefit-specific credit for company. Company cannot owe monetary damages under benefit chapter for benefit failure. Directors and officers have benefit-failure monetary protection and protection for compliant acts; special benefit director exceptions include self-dealing, willful misconduct and knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Arkansas earns the benefit-specific credit for directors. Company cannot owe monetary damages under benefit chapter for benefit failure. Directors and officers have benefit-failure monetary protection and protection for compliant acts; special benefit director exceptions include self-dealing, willful misconduct and knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Arkansas earns the benefit-specific credit for officers. Company cannot owe monetary damages under benefit chapter for benefit failure. Directors and officers have benefit-failure monetary protection and protection for compliant acts; special benefit director exceptions include self-dealing, willful misconduct and knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Arkansas: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Arkansas: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Arkansas: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Arkansas has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 6, 6 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 6, 6 ], "reason": "Ordinary reporting $0 + benefit filing $70 = $70 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Arkansas has a compared recurring floor of $220 per year, including $150 in identified minimum tax/license charges. Small active domestic stock C corporation operating in Arkansas, no Arkansas taxable profit, and Arkansas-attributed capital stock of $50,000 or less: the $150 franchise minimum applies. Tax only, excluding report and local/industry fees. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry, exit and covered fundamental transactions require 2/3 of each class/series, including otherwise nonvoting shares. Nonordinary sale of all/substantially all assets also requires minimum vote.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Arkansas: becoming a benefit company requires 2/3 each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Arkansas: changing back requires 2/3 each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Arkansas requires report access for people outside the company, so it earns public-access credit. Annual report goes to shareholders before franchise-tax due date or with annual financial report, is published on public website (all reports; latest free copy if no website), and concurrently filed with Secretary of State; specified compensation/proprietary information may be removed.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Arkansas: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Arkansas: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Arkansas makes a mission duty mandatory, so it earns this credit. Directors must consider the listed shareholders, workforce, customers, communities, environment, long-term interests and benefit purposes; priority may be set in articles. Benefit director is optional and ordinarily independent.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 70, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 220, "minimumTaxAnnualized": 150, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 67, 67 ], "tax": { "code": "AR", "incomeSummary": "For tax years beginning on or after January 1, 2024, ordinary C-corporation income tax has marginal rates of 1% on the first $3,000, 2% on the next $3,000, 3% on the next $5,000, and 4.3% above $11,000 of Arkansas taxable income. The official table gives $240 plus 4.3% of income above $11,000.", "recurringSummary": "The annual stock-corporation franchise tax is 0.3% of issued and outstanding capital stock attributed to Arkansas using the property ratio, with a $150 minimum. No-par shares are assigned $25 per share for this calculation. All registered for-profit corporations owe the tax; it continues until dissolution, withdrawal, or merger, including while revoked. The $300 nonstock-corporation rule is outside this stock-corporation scope.", "formationAnnualTaxFloor": 150, "floorBasis": "$150 annual franchise tax for a nonexempt domestic for-profit stock corporation in a regular year. This is tax only; registry/report fees, benefit-report fees, processing charges, penalties, and income or operating taxes are excluded.", "scenarioMinimum": 150, "scenarioBasis": "Small active domestic stock C corporation operating in Arkansas, no Arkansas taxable profit, and Arkansas-attributed capital stock of $50,000 or less: the $150 franchise minimum applies. Tax only, excluding report and local/industry fees.", "operatingTaxCaution": "Incorporation does not substitute for measuring taxable income and multistate activity. Arkansas generally uses single-sales-factor apportionment. Act 719 changes services/intangibles to market sourcing and adds a $250,000 receipts economic-nexus threshold for nonresident corporations without physical presence for tax years beginning in 2026. Sales/use, employment, property, and other states' nexus obligations are separate.", "sources": [ { "label": "Arkansas DFA: 2025 C Corporation Income Tax Instructions, 2024-forward rates and 2026 sourcing/nexus changes", "url": "https://www.dfa.arkansas.gov/wp-content/uploads/CorporationIncomeTaxInstructions_2025.pdf", "checked": "2026-10-11", "section": "Arkansas DFA: 2025 C Corporation Income Tax Instructions, 2024-forward rates and 2026 sourcing/nexus changes" }, { "label": "Arkansas Secretary of State: 2026 stock-corporation franchise report and calculation", "url": "https://www.sos.arkansas.gov/uploads/bcs/Corp1_FT_2026.pdf", "checked": "2026-10-11", "section": "Arkansas Secretary of State: 2026 stock-corporation franchise report and calculation" }, { "label": "Arkansas Secretary of State: annual franchise tax applicability and current forms", "url": "https://www.sos.arkansas.gov/business-commercial-services-bcs/franchise-tax-report-forms/", "checked": "2026-10-11", "section": "Arkansas Secretary of State: annual franchise tax applicability and current forms" } ] }, "conversion": { "state": "Arkansas", "code": "AR", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 each class/series", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry, exit and covered fundamental transactions require 2/3 of each class/series, including otherwise nonvoting shares. Nonordinary sale of all/substantially all assets also requires minimum vote.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://arkleg.state.ar.us/Home/FTPDocument?path=/ACTS/2013/Public/ACT1388.pdf", "section": "Arkansas Act 1388 of 2013 / Ark. Code 4-36-103; 4-36-105; 4-36-106" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a specific benefit may be added without replacing the general purpose.", "difference": "Arkansas offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Articles may eliminate or limit directors\u2019 personal liability to the corporation or stockholders for monetary fiduciary-duty damages. Officers are outside this charter authorization. Exceptions preserve loyalty breaches, bad faith, intentional misconduct, knowing law violations, unlawful distributions, improper personal benefit, and any third-party liability. Protection starts when the charter clause takes effect; earlier acts remain exposed. Benefit-specific rule: Company cannot owe monetary damages under benefit chapter for benefit failure. Directors and officers have benefit-failure monetary protection and protection for compliant acts; special benefit director exceptions include self-dealing, willful misconduct and knowing law violations.", "difference": "Arkansas keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Independent benefit director is optional. Arkansas expressly excludes all third-party liability from this ordinary director charter protection." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual report goes to shareholders before franchise-tax due date or with annual financial report, is published on public website (all reports; latest free copy if no website), and concurrently filed with Secretary of State; specified compensation/proprietary information may be removed. Assessment rule: Annual social/environmental assessment must use a third-party standard. Assessment need not be performed, audited or certified by the standard provider.", "difference": "Arkansas: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $70 per year on an annualized basis. Minimum tax/license used here: $150. Small active domestic stock C corporation operating in Arkansas, no Arkansas taxable profit, and Arkansas-attributed capital stock of $50,000 or less: the $150 franchise minimum applies. Tax only, excluding report and local/industry fees.", "difference": "Arkansas has a compared recurring floor of $220 per year, including $150 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 each class/series. Entry, exit and covered fundamental transactions require 2/3 of each class/series, including otherwise nonvoting shares. Nonordinary sale of all/substantially all assets also requires minimum vote. Changing back: 2/3 each class/series", "difference": "Arkansas entry uses 2/3 each class/series; exit uses 2/3 each class/series. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider the listed shareholders, workforce, customers, communities, environment, long-term interests and benefit purposes; priority may be set in articles. Benefit director is optional and ordinarily independent. Disclosure: Annual report goes to shareholders before franchise-tax due date or with annual financial report, is published on public website (all reports; latest free copy if no website), and concurrently filed with Secretary of State; specified compensation/proprietary information may be removed. Enforcement: Corporation directly; derivatively any shareholder, director, 5% parent-equity holders, or charter/bylaw designees. No minimum corporation-share percentage for its own shareholder.", "difference": "Arkansas requires public access to the report. Separate $70 state benefit-report filing fee. Any shareholder can bring a benefit derivative claim; no 2% floor." } } }, "guideUrl": "/assets/state-guides/AR.md" }, { "state": "California", "abbreviation": "CA", "form": "Benefit corporation; also social purpose corporation", "status": "Available", "reviewed": "2026-10-11", "family": "general-benefit model with any-shareholder enforcement and fee shifting", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a charter may add specific public benefits.", "sources": [ { "id": "CA-enacted", "url": "https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB361", "section": "Enacted 2011 AB 361, \u00a7\u00a714601,14603\u201314604,14610,14620\u201314623", "claims": [ "Benefit purpose, votes, benefit damages, any-shareholder enforcement and fee-shifting provisions; signed enactment, not a full 2026 amendment audit" ] } ] }, "board": { "model": "mandatory_stakeholder_consideration", "summary": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "sources": [ { "id": "CA-enacted", "url": "https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB361", "section": "Enacted 2011 AB 361, \u00a7\u00a714601,14603\u201314604,14610,14620\u201314623", "claims": [ "Benefit purpose, votes, benefit damages, any-shareholder enforcement and fee-shifting provisions; signed enactment, not a full 2026 amendment audit" ] } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "sources": [ { "id": "CA-report", "url": "https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CORP§ionNum=14630.", "section": "Current \u00a714630", "claims": [ "Annual reporting, standard, no required certification, publication, 5% holder disclosure" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "deadline": "Earlier of 120 days after fiscal year end or delivery of another annual shareholder report.", "redactions": "Director compensation and financial/proprietary information may be omitted publicly.", "summary": "Annual shareholder and public report against third-party standard; report identifies holders of at least 5% of shares. No benefit-report state filing in current \u00a7\u00a714630\u201314631.", "sources": [ { "id": "CA-report", "url": "https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CORP§ionNum=14630.", "section": "Current \u00a714630", "claims": [ "Annual reporting, standard, no required certification, publication, 5% holder disclosure" ] } ] }, "enforcement": { "threshold": "Any shareholder; director; at least 5% equity owner of a parent; articles/bylaws-authorized persons.", "summary": "No percentage floor for a shareholder benefit enforcement proceeding. Court may award plaintiff expenses and attorney fees for noncompliance without justification.", "sources": [ { "id": "CA-enacted", "url": "https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB361", "section": "Enacted 2011 AB 361, \u00a7\u00a714601,14603\u201314604,14610,14620\u201314623", "claims": [ "Benefit purpose, votes, benefit damages, any-shareholder enforcement and fee-shifting provisions; signed enactment, not a full 2026 amendment audit" ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to create general or specific benefit.", "directors": "No monetary damages under benefit part for failure to create benefit; separate shield for actions/inactions complying with statutory benefit duties.", "officers": "Compliant officer actions/inactions and failure to create benefit protected under \u00a714622.", "summary": "The benefit-purpose shield is expressly separate from ordinary charter exculpation; any-shareholder standing and fee shifting strengthen accountability.", "sources": [ { "id": "CA-enacted", "url": "https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB361", "section": "Enacted 2011 AB 361, \u00a7\u00a714601,14603\u201314604,14610,14620\u201314623", "claims": [ "Benefit purpose, votes, benefit damages, any-shareholder enforcement and fee-shifting provisions; signed enactment, not a full 2026 amendment audit" ] } ] }, "ordinaryExculpation": { "scope": "directors only; officer conduct expressly excluded even when the officer is also a director", "activation": "An articles provision under Corporations Code \u00a7204(a)(10); \u00a7204(b) also permits these provisions in a close-corporation shareholders agreement.", "exceptions": [ "Intentional misconduct or a knowing and culpable law violation", "Acts believed contrary to the corporation/shareholders' best interests, or absence of good faith", "Improper personal benefit", "Reckless disregard where the director knew or should have known of a serious-injury risk", "An unexcused pattern of inattention amounting to abdication", "Interested transactions under \u00a7310 and specified unlawful distributions under \u00a7316", "Acts before the provision takes effect", "Officer conduct, even by someone also serving as a director and even if directors ratify it" ], "summary": "\u00a7204(a)(10) permits prospective monetary limitation in corporate/derivative director-duty actions. California expressly retains recklessness and abdication exposure and excludes officer acts. The benefit-act shield remains a separate provision.", "sources": [ { "id": "CA-ordinary-current", "url": "https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180SB838", "section": "2018 ch.889 \u00a72, operative Corporations Code \u00a7204(a)(10), (b), (e)", "claims": [ "Director-only prospective articles limitation; all ordinary exceptions; officer-act exclusion; operative January 1, 2022" ] } ] }, "statusChange": { "entryVote": "Two thirds of every class or series, including nonvoting shares.", "exitVote": "Two thirds of every class or series, including nonvoting shares.", "lock": "Specific-purpose changes also require minimum status vote; dissenters\u2019 rights apply to specified entry/exit transactions.", "summary": "A two-thirds class vote protects status and specific-purpose changes, with statutory dissenters\u2019 rights.", "sources": [ { "id": "CA-enacted", "url": "https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB361", "section": "Enacted 2011 AB 361, \u00a7\u00a714601,14603\u201314604,14610,14620\u201314623", "claims": [ "Benefit purpose, votes, benefit damages, any-shareholder enforcement and fee-shifting provisions; signed enactment, not a full 2026 amendment audit" ] } ] } }, "costs": { "regularReport": { "amount": 25, "cadence": "annual", "conditions": "Annual stock-corporation Statement of Information; not the $20 biennial LLC/nonprofit fee.", "summary": "Annual stock-corporation Statement of Information; not the $20 biennial LLC/nonprofit fee.", "sources": [ { "id": "CA-normal-fee", "url": "https://www.sos.ca.gov/business-programs/cannabizfile/cannabis-forms-and-fees/change-nonprofit-mutual-benefit-corporation-stock-corporation", "section": "Stock-corporation Statement of Information row", "claims": [ "$25 stock-corporation statement fee" ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No state benefit-report filing requirement in \u00a7\u00a714630\u201314631.", "summary": "No state benefit-report filing requirement in \u00a7\u00a714630\u201314631.", "sources": [ { "id": "CA-report", "url": "https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CORP§ionNum=14630.", "section": "Current \u00a714630", "claims": [ "Annual reporting, standard, no required certification, publication, 5% holder disclosure" ] } ] }, "minimumTax": { "amount": 800, "cadence": "annual", "conditions": "Generally minimum franchise tax; newly incorporated/qualified corporation first taxable year exception. Income-based tax can exceed minimum.", "summary": "Generally minimum franchise tax; newly incorporated/qualified corporation first taxable year exception. Income-based tax can exceed minimum.", "sources": [ { "id": "CA-tax", "url": "https://www.ftb.ca.gov/file/business/types/corporations/c-corporations.html", "section": "Minimum franchise tax", "claims": [ "Generally $800 minimum; first-taxable-year exception" ] }, { "label": "California FTB, C corporations: 8.84%, $800, first-year and short-year exceptions", "url": "https://www.ftb.ca.gov/file/business/types/corporations/c-corporations.html", "checked": "2026-10-11", "section": "California FTB, C corporations: 8.84%, $800, first-year and short-year exceptions" }, { "label": "California FTB Publication 1060: first year and subsequent franchise minimum", "url": "https://www.ftb.ca.gov/forms/misc/1060.html", "checked": "2026-10-11", "section": "California FTB Publication 1060: first year and subsequent franchise minimum" }, { "label": "California FTB Publication 1123: benefit corporations, nonprofit distinction and corporate taxation", "url": "https://www.ftb.ca.gov/forms/misc/1123.html", "checked": "2026-10-11", "section": "California FTB Publication 1123: benefit corporations, nonprofit distinction and corporate taxation" } ] } }, "sources": [ { "id": "CA-enacted", "url": "https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB361", "section": "Enacted 2011 AB 361, \u00a7\u00a714601,14603\u201314604,14610,14620\u201314623", "claims": [ "Benefit purpose, votes, benefit damages, any-shareholder enforcement and fee-shifting provisions; signed enactment, not a full 2026 amendment audit" ] }, { "id": "CA-report", "url": "https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CORP§ionNum=14630.", "section": "Current \u00a714630", "claims": [ "Annual reporting, standard, no required certification, publication, 5% holder disclosure" ] }, { "id": "CA-legend", "url": "https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CORP§ionNum=14631.", "section": "Current \u00a714631", "claims": [ "Share-certificate legend, not state filing" ] }, { "id": "CA-normal-fee", "url": "https://www.sos.ca.gov/business-programs/cannabizfile/cannabis-forms-and-fees/change-nonprofit-mutual-benefit-corporation-stock-corporation", "section": "Stock-corporation Statement of Information row", "claims": [ "$25 stock-corporation statement fee" ] }, { "id": "CA-report-cadence", "url": "https://www.sos.ca.gov/business-programs/business-entities/statements/", "section": "Stock-corporation statements", "claims": [ "Annual stock corporation report cadence" ] }, { "id": "CA-tax", "url": "https://www.ftb.ca.gov/file/business/types/corporations/c-corporations.html", "section": "Minimum franchise tax", "claims": [ "Generally $800 minimum; first-taxable-year exception" ] }, { "id": "CA-ordinary-current", "url": "https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180SB838", "section": "2018 ch.889 \u00a72, operative Corporations Code \u00a7204(a)(10), (b), (e)", "claims": [ "Director-only prospective articles limitation; all ordinary exceptions; officer-act exclusion; operative January 1, 2022" ] }, { "label": "California FTB, C corporations: 8.84%, $800, first-year and short-year exceptions", "url": "https://www.ftb.ca.gov/file/business/types/corporations/c-corporations.html", "checked": "2026-10-11", "section": "California FTB, C corporations: 8.84%, $800, first-year and short-year exceptions" }, { "label": "California FTB Publication 1060: first year and subsequent franchise minimum", "url": "https://www.ftb.ca.gov/forms/misc/1060.html", "checked": "2026-10-11", "section": "California FTB Publication 1060: first year and subsequent franchise minimum" }, { "label": "California FTB Publication 1123: benefit corporations, nonprofit distinction and corporate taxation", "url": "https://www.ftb.ca.gov/forms/misc/1123.html", "checked": "2026-10-11", "section": "California FTB Publication 1123: benefit corporations, nonprofit distinction and corporate taxation" } ], "differences": [ "Any shareholder can enforce benefit duties, and unjustified noncompliance may shift plaintiff legal fees.", "Annual report discloses 5% holders, a privacy consideration.", "California social purpose corporation is a separate stock form; nonprofit public benefit corporation is not this for-profit form.", "\u00a714631 requires a conspicuous benefit-corporation legend on share certificates, not state benefit-report filing.", "Ordinary charter exculpation is director-only; California preserves recklessness and repeated inattention as well as misconduct exceptions." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "AB 361 effective January 1, 2012; current report and certificate sections show unchanged 2011 enactment.", "Current \u00a7204 was added by 2018 ch.889 \u00a72 (SB 838), operative January 1, 2022; its operative text was checked in the official signed enactment and crosschecked against the current 2025 codification." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation; also social purpose corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "California offers Benefit corporation; also social purpose corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "California has an identified director monetary-protection provision in the compared scope, which earns this credit. \u00a7204(a)(10) permits prospective monetary limitation in corporate/derivative director-duty actions. California expressly retains recklessness and abdication exposure and excludes officer acts. The benefit-act shield remains a separate provision.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "California does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "California requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "California earns the benefit-specific credit for company. The benefit-purpose shield is expressly separate from ordinary charter exculpation; any-shareholder standing and fee shifting strengthen accountability.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "California earns the benefit-specific credit for directors. The benefit-purpose shield is expressly separate from ordinary charter exculpation; any-shareholder standing and fee shifting strengthen accountability.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "California earns the benefit-specific credit for officers. The benefit-purpose shield is expressly separate from ordinary charter exculpation; any-shareholder standing and fee shifting strengthen accountability.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "California: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "California: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "California: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "California has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 3, 3 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 3, 3 ], "reason": "Ordinary reporting $25 + benefit filing $0 = $25 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "California has a compared recurring floor of $825 per year, including $800 in identified minimum tax/license charges. Regular operating year after the first taxable year, domestic ordinary C corporation, no taxable profit and no special exemption. Includes $800 franchise minimum; excludes registry and variable taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "A two-thirds class vote protects status and specific-purpose changes, with statutory dissenters\u2019 rights.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "California: becoming a benefit company requires Two thirds of every class or series, including nonvoting shares. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "California: changing back requires Two thirds of every class or series, including nonvoting shares. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "California requires report access for people outside the company, so it earns public-access credit. Annual shareholder and public report against third-party standard; report identifies holders of at least 5% of shares. No benefit-report state filing in current \u00a7\u00a714630\u201314631.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "California: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "California: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "California makes a mission duty mandatory, so it earns this credit. Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 25, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "Benefit corporation", "recurringMinimumAnnualized": 825, "minimumTaxAnnualized": 800, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 67, 67 ], "tax": { "code": "CA", "incomeSummary": "Ordinary C corporations pay 8.84% on California taxable income, subject to the $800 franchise minimum. First-year income remains taxable at 8.84% even when the minimum is waived. Benefit corporations remain corporations; benefit status does not itself establish tax exemption.", "recurringSummary": "Corporations incorporated, registered or doing business in California generally owe at least $800 annually, including inactive or loss-making corporations. Newly incorporated or qualified corporations are exempt from the minimum for their first taxable year; the limited 15-day/no-business exception also applies.", "formationAnnualTaxFloor": 800, "floorBasis": "Regular taxable years after the first, ordinary domestic C corporation without a special statutory exemption. $800 franchise minimum; separate registry statement fees and variable taxes excluded. This is not a first-year charge.", "scenarioMinimum": 800, "scenarioBasis": "Regular operating year after the first taxable year, domestic ordinary C corporation, no taxable profit and no special exemption. Includes $800 franchise minimum; excludes registry and variable taxes.", "operatingTaxCaution": "California-source income, registration and doing-business nexus can create obligations for corporations formed elsewhere. Multistate income is allocated/apportioned; an out-of-state charter does not avoid California operating tax.", "sources": [ { "label": "California FTB, C corporations: 8.84%, $800, first-year and short-year exceptions", "url": "https://www.ftb.ca.gov/file/business/types/corporations/c-corporations.html", "checked": "2026-10-11", "section": "California FTB, C corporations: 8.84%, $800, first-year and short-year exceptions" }, { "label": "California FTB Publication 1060: first year and subsequent franchise minimum", "url": "https://www.ftb.ca.gov/forms/misc/1060.html", "checked": "2026-10-11", "section": "California FTB Publication 1060: first year and subsequent franchise minimum" }, { "label": "California FTB Publication 1123: benefit corporations, nonprofit distinction and corporate taxation", "url": "https://www.ftb.ca.gov/forms/misc/1123.html", "checked": "2026-10-11", "section": "California FTB Publication 1123: benefit corporations, nonprofit distinction and corporate taxation" } ] }, "conversion": { "state": "California", "code": "CA", "form": "Benefit corporation; also social purpose corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "Two thirds of every class or series, including nonvoting shares.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "A two-thirds class vote protects status and specific-purpose changes, with statutory dissenters\u2019 rights.", "proposal": "Consider ordinary-amendment entry parity and status-only appraisal reform together; preserve other dissent, class and contract rights.", "sources": [ { "id": "CA-enacted", "url": "https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201120120AB361", "section": "Enacted 2011 AB 361, \u00a7\u00a714601,14603\u201314604,14610,14620\u201314623", "claims": [ "Benefit purpose, votes, benefit damages, any-shareholder enforcement and fee-shifting provisions; signed enactment, not a full 2026 amendment audit" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a charter may add specific public benefits.", "difference": "California offers Benefit corporation; also social purpose corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "\u00a7204(a)(10) permits prospective monetary limitation in corporate/derivative director-duty actions. California expressly retains recklessness and abdication exposure and excludes officer acts. The benefit-act shield remains a separate provision. Benefit-specific rule: The benefit-purpose shield is expressly separate from ordinary charter exculpation; any-shareholder standing and fee shifting strengthen accountability.", "difference": "California keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Ordinary charter exculpation is director-only; California preserves recklessness and repeated inattention as well as misconduct exceptions." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder and public report against third-party standard; report identifies holders of at least 5% of shares. No benefit-report state filing in current \u00a7\u00a714630\u201314631. Assessment rule: Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "difference": "California: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $25 per year on an annualized basis. Minimum tax/license used here: $800. Regular operating year after the first taxable year, domestic ordinary C corporation, no taxable profit and no special exemption. Includes $800 franchise minimum; excludes registry and variable taxes.", "difference": "California has a compared recurring floor of $825 per year, including $800 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Two thirds of every class or series, including nonvoting shares. A two-thirds class vote protects status and specific-purpose changes, with statutory dissenters\u2019 rights. Changing back: Two thirds of every class or series, including nonvoting shares.", "difference": "California entry uses Two thirds of every class or series, including nonvoting shares.; exit uses Two thirds of every class or series, including nonvoting shares.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities. Disclosure: Annual shareholder and public report against third-party standard; report identifies holders of at least 5% of shares. No benefit-report state filing in current \u00a7\u00a714630\u201314631. Enforcement: No percentage floor for a shareholder benefit enforcement proceeding. Court may award plaintiff expenses and attorney fees for noncompliance without justification.", "difference": "California requires public access to the report. Any shareholder can enforce benefit duties, and unjustified noncompliance may shift plaintiff legal fees. Annual report discloses 5% holders, a privacy consideration. California social purpose corporation is a separate stock form; nonprofit public benefit corporation is not this for-profit form. \u00a714631 requires a conspicuous benefit-corporation legend on share certificates, not state benefit-report filing." } } }, "guideUrl": "/assets/state-guides/CA.md" }, { "state": "Colorado", "abbreviation": "CO", "form": "Public benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "specific-benefit three-way balancing", "features": { "purpose": { "generalRequired": false, "specificRequired": true, "specificOptional": false, "summary": "Certificate must identify one or more specific public benefits. Responsible and sustainable operation is required; no model-style mandatory general whole-society/environment purpose.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] } ] }, "board": { "model": "explicit_three_way_balancing", "summary": "Directors must balance shareholders\u2019 pecuniary interests, interests of those materially affected, and charter public benefits. Informed, disinterested, nonirrational decisions satisfy this duty.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] } ], "mode": "explicit_three_way_balancing" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "deadline": "Annual; no 120-day benefit-report deadline identified in \u00a77-101-507.", "redactions": "No express redaction clause identified in \u00a77-101-507.", "summary": "Annual public and shareholder benefit report, with third-party-standard assessment; outside certification/audit is not required.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] } ] }, "enforcement": { "threshold": "2% of outstanding shares at filing; nationally listed corporation alternative shares worth at least $2 million.", "summary": "\u00a77-101-508 limits an action enforcing the balancing requirement to qualifying stockholders; ordinary derivative requirements also apply.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] } ] }, "benefitLiability": { "company": "No separate blanket company monetary-damages bar found in this PBC part.", "directors": "Informed/disinterested/nonirrational balancing decision satisfies fiduciary duty. Absent an interested transaction, balancing failure does not constitute bad faith or loyalty breach.", "officers": "No distinct benefit-act officer money shield identified.", "summary": "Director protection is a balancing safe harbor and default bad-faith/loyalty classification rule, not the model-act blanket corporate benefit-failure bar.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] } ] }, "ordinaryExculpation": { "scope": "directors", "activation": "Opt-in articles of incorporation.", "exceptions": [ "Improper financial benefit", "Intentional infliction of harm", "Specified unlawful distributions", "Intentional criminal-law violation", "Acts before the provision becomes effective" ], "summary": "\u00a77-102-102(2)(d) permits director charter exculpation with financial-benefit, intentional-harm, unlawful-distribution and intentional-criminal exceptions.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] } ] }, "statusChange": { "entryVote": "Ordinary corporate amendment/conversion votes; former PBC-specific two-thirds vote removed in 2022.", "exitVote": "Ordinary corporate votes; no benefit-specific supermajority retained.", "lock": "No statutory permanent mission lock; nonprofit conversion/merger into PBC is restricted.", "summary": "2022 amendments reduced special voting/appraisal barriers; use ordinary transaction rules and charter terms.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] }, { "id": "CO-2022", "url": "https://leg.colorado.gov/bills/sb22-045", "section": "SB 22-045 enacted 2022", "claims": [ "Removed special votes/appraisal and changed default director protection" ] } ] } }, "costs": { "regularReport": { "amount": 25, "cadence": "annual", "conditions": "Normal periodic report under current Secretary of State fee table.", "summary": "Normal periodic report under current Secretary of State fee table.", "sources": [ { "id": "CO-fees", "url": "https://www.sos.state.co.us/pubs/info_center/fees/business.html", "section": "Periodic report row, revised July 1, 2024", "claims": [ "$25 annual periodic report" ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate state benefit-report filing identified.", "summary": "No separate state benefit-report filing identified.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] }, { "id": "CO-fees", "url": "https://www.sos.state.co.us/pubs/info_center/fees/business.html", "section": "Periodic report row, revised July 1, 2024", "claims": [ "$25 annual periodic report" ] } ] }, "minimumTax": { "amount": 0, "cadence": "annual", "conditions": "No fixed minimum is imposed by the general C-corporation income-tax calculation: tax is a percentage of Colorado taxable net income under \u00a739-22-301, with allocation/apportionment and tax-year rate rules. $0 here means no fixed general corporate-income minimum, not no tax or no filing duty.", "summary": "No fixed minimum is imposed by the general C-corporation income-tax calculation: tax is a percentage of Colorado taxable net income under \u00a739-22-301, with allocation/apportionment and tax-year rate rules. $0 here means no fixed general corporate-income minimum, not no tax or no filing duty.", "sources": [ { "id": "CO-tax-applicability", "url": "https://tax.colorado.gov/corporate-income-tax-guide", "section": "Parts1,3,6,10; \u00a739-22-301", "claims": [ "C-corporation income tax is a percentage of attributable taxable net income; allocation/apportionment and return requirements apply." ] }, { "label": "Colorado DOR, Corporate Income Tax Guide: taxable-income calculation, tax-year rates, nexus and apportionment", "url": "https://tax.colorado.gov/corporate-income-tax-guide", "checked": "2026-10-11", "section": "Colorado DOR, Corporate Income Tax Guide: taxable-income calculation, tax-year rates, nexus and apportionment" }, { "label": "Colorado General Assembly, corporate income tax: current statutory 4.40% rate", "url": "https://content.leg.colorado.gov/agencies/legislative-council-staff/corporate-income-tax%C2%A0", "checked": "2026-10-11", "section": "Colorado General Assembly, corporate income tax: current statutory 4.40% rate" } ] } }, "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] }, { "id": "CO-official-index", "url": "https://content.qa.coleg.gov/agencies/office-legislative-legal-services/2025-crs-titles-download", "section": "Official General Assembly 2025 CRS Title 7 download link", "claims": [ "Official index links the OLLS title compilation" ] }, { "id": "CO-2022", "url": "https://leg.colorado.gov/bills/sb22-045", "section": "SB 22-045 enacted 2022", "claims": [ "Removed special votes/appraisal and changed default director protection" ] }, { "id": "CO-fees", "url": "https://www.sos.state.co.us/pubs/info_center/fees/business.html", "section": "Periodic report row, revised July 1, 2024", "claims": [ "$25 annual periodic report" ] }, { "id": "CO-tax-applicability", "url": "https://tax.colorado.gov/corporate-income-tax-guide", "section": "Parts1,3,6,10; \u00a739-22-301", "claims": [ "C-corporation income tax is a percentage of attributable taxable net income; allocation/apportionment and return requirements apply." ] }, { "label": "Colorado DOR, Corporate Income Tax Guide: taxable-income calculation, tax-year rates, nexus and apportionment", "url": "https://tax.colorado.gov/corporate-income-tax-guide", "checked": "2026-10-11", "section": "Colorado DOR, Corporate Income Tax Guide: taxable-income calculation, tax-year rates, nexus and apportionment" }, { "label": "Colorado General Assembly, corporate income tax: current statutory 4.40% rate", "url": "https://content.leg.colorado.gov/agencies/legislative-council-staff/corporate-income-tax%C2%A0", "checked": "2026-10-11", "section": "Colorado General Assembly, corporate income tax: current statutory 4.40% rate" } ], "differences": [ "Specific charter mission and explicit balancing differ from broad general-benefit model duties.", "Colorado annual public third-party-standard assessment is stricter than Delaware\u2019s default reporting.", "The 2022 law removed special two-thirds status votes/appraisal rules and made the disinterested bad-faith/loyalty protection automatic." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "2022 PBC amendments are reflected in 2025 official compilation." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Public benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Colorado offers Public benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 8, 8 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Colorado has an identified director monetary-protection provision in the compared scope, which earns this credit. \u00a77-102-102(2)(d) permits director charter exculpation with financial-benefit, intentional-harm, unlawful-distribution and intentional-criminal exceptions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Colorado does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Colorado requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit decision / classification safe harbor", "range": [ 2, 2 ], "reason": "2 points instead of the separate company/director/officer outcome-bar credits. The cited safe harbor is not treated as a blanket mission-failure damages bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection for benefit decisions", "why": "Colorado protects certain properly made or classified benefit decisions. This is narrower than an express company/director/officer bar on damages merely for missing the mission, so only the narrower safe-harbor credit applies. Director protection is a balancing safe harbor and default bad-faith/loyalty classification rule, not the model-act blanket corporate benefit-failure bar.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Colorado: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Colorado: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Colorado: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Colorado has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $25 + benefit filing $0 = $25 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Colorado has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges. Ordinary domestic C corporation operating in Colorado with no Colorado taxable net income. No fixed corporate-income minimum added; registry fees and all variable operating taxes excluded. The rate is not used to estimate tax. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 10, 10 ], "reason": "2022 amendments reduced special voting/appraisal barriers; use ordinary transaction rules and charter terms.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Colorado: becoming a benefit company requires Ordinary corporate amendment/conversion votes; former PBC-specific two-thirds vote removed in 2022. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 10, 10 ], "reason": "No added benefit-status supermajority: 10 points. Ordinary transaction votes and any higher charter votes still apply. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Colorado: changing back requires Ordinary corporate votes; no benefit-specific supermajority retained. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Colorado requires report access for people outside the company, so it earns public-access credit. Annual public and shareholder benefit report, with third-party-standard assessment; outside certification/audit is not required.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Colorado: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Colorado: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Colorado makes a mission duty mandatory, so it earns this credit. Directors must balance shareholders\u2019 pecuniary interests, interests of those materially affected, and charter public benefits. Informed, disinterested, nonirrational decisions satisfy this duty.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 25, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "ordinary", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 25, "minimumTaxAnnualized": 0, "entryCategory": "ordinary" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Ordinary transaction votes" }, "scoreRange": [ 75, 75 ], "tax": { "code": "CO", "incomeSummary": "Colorado's statutory corporate income-tax rate is 4.4% of Colorado taxable income; temporary tax-year reductions can apply. The agency lists 4.4% for 2025 and 4.25% for 2024. The general calculation has no fixed corporate minimum.", "recurringSummary": "No additional fixed general corporate-income minimum is identified in the ordinary taxable-income calculation. Annual registry fees are separate; positive income and other taxable activities can produce tax.", "formationAnnualTaxFloor": 0, "floorBasis": "No fixed minimum in the general C-corporation income calculation; $0 excludes registry fees and variable income/operating taxes. It does not mean no filing or tax obligations.", "scenarioMinimum": 0, "scenarioBasis": "Ordinary domestic C corporation operating in Colorado with no Colorado taxable net income. No fixed corporate-income minimum added; registry fees and all variable operating taxes excluded. The rate is not used to estimate tax.", "operatingTaxCaution": "Doing business and Colorado-source income create nexus. Multistate allocation/apportionment and combined-return rules apply; the state of incorporation is not the sole tax jurisdiction.", "sources": [ { "label": "Colorado DOR, Corporate Income Tax Guide: taxable-income calculation, tax-year rates, nexus and apportionment", "url": "https://tax.colorado.gov/corporate-income-tax-guide", "checked": "2026-10-11", "section": "Colorado DOR, Corporate Income Tax Guide: taxable-income calculation, tax-year rates, nexus and apportionment" }, { "label": "Colorado General Assembly, corporate income tax: current statutory 4.40% rate", "url": "https://content.leg.colorado.gov/agencies/legislative-council-staff/corporate-income-tax%C2%A0", "checked": "2026-10-11", "section": "Colorado General Assembly, corporate income tax: current statutory 4.40% rate" } ] }, "conversion": { "state": "Colorado", "code": "CO", "form": "Public benefit corporation", "status": "Available", "group": "ordinary", "groupLabel": "Ordinary / qualified-majority route", "entryVote": "Ordinary corporate amendment/conversion votes; former PBC-specific two-thirds vote removed in 2022.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "2022 amendments reduced special voting/appraisal barriers; use ordinary transaction rules and charter terms.", "proposal": "Preserve the 2022 entry/appraisal simplification; make the amendment form and ongoing mission duty easy to understand.", "sources": [ { "id": "CO-code", "url": "https://olls.info/crs/crs2025-title-07.htm", "section": "2025 CRS \u00a7\u00a77-101-503\u2013508; \u00a77-102-102(2)(d)", "claims": [ "Specific mission, balancing, annual public independent-standard report, 2%/$2m enforcement, ordinary exculpation" ] }, { "id": "CO-2022", "url": "https://leg.colorado.gov/bills/sb22-045", "section": "SB 22-045 enacted 2022", "claims": [ "Removed special votes/appraisal and changed default director protection" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Certificate must identify one or more specific public benefits. Responsible and sustainable operation is required; no model-style mandatory general whole-society/environment purpose.", "difference": "Colorado offers Public benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "\u00a77-102-102(2)(d) permits director charter exculpation with financial-benefit, intentional-harm, unlawful-distribution and intentional-criminal exceptions. Benefit-specific rule: Director protection is a balancing safe harbor and default bad-faith/loyalty classification rule, not the model-act blanket corporate benefit-failure bar.", "difference": "Colorado keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. " }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual public and shareholder benefit report, with third-party-standard assessment; outside certification/audit is not required. Assessment rule: Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "difference": "Colorado: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $25 per year on an annualized basis. Minimum tax/license used here: $0. Ordinary domestic C corporation operating in Colorado with no Colorado taxable net income. No fixed corporate-income minimum added; registry fees and all variable operating taxes excluded. The rate is not used to estimate tax.", "difference": "Colorado has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Ordinary corporate amendment/conversion votes; former PBC-specific two-thirds vote removed in 2022. 2022 amendments reduced special voting/appraisal barriers; use ordinary transaction rules and charter terms. Changing back: Ordinary corporate votes; no benefit-specific supermajority retained.", "difference": "Colorado entry uses Ordinary corporate amendment/conversion votes; former PBC-specific two-thirds vote removed in 2022.; exit uses Ordinary corporate votes; no benefit-specific supermajority retained.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must balance shareholders\u2019 pecuniary interests, interests of those materially affected, and charter public benefits. Informed, disinterested, nonirrational decisions satisfy this duty. Disclosure: Annual public and shareholder benefit report, with third-party-standard assessment; outside certification/audit is not required. Enforcement: \u00a77-101-508 limits an action enforcing the balancing requirement to qualifying stockholders; ordinary derivative requirements also apply.", "difference": "Colorado requires public access to the report. Colorado annual public third-party-standard assessment is stricter than Delaware\u2019s default reporting." } } }, "guideUrl": "/assets/state-guides/CO.md" }, { "state": "Connecticut", "abbreviation": "CT", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / mandatory-stakeholder model", "features": { "purpose": { "summary": "General public benefit required; specific charter benefits optional and cannot limit the general obligation.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1357" } ] }, "board": { "summary": "Directors must consider stakeholder effects and mission. Charter can prioritize a specified benefit. Independent benefit director mandatory only for publicly traded corporations; optional for private corporations.", "mode": "mandatory_consider", "benefitDirectorRequired": "publicly traded only", "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a7\u00a733-1358,33-1359" } ] }, "standard": { "summary": "Third-party assessment standard required. No third-party audit or certification required; selecting/changing standard requires prescribed board/shareholder approval.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1363" } ] }, "report": { "summary": "Annual; each shareholder by earlier of 120 days or other annual report. All reports remain public online; latest free on request if no website. No state filing.", "cadence": "annual", "shareholders": true, "publicWebsite": "all annual reports", "stateFiling": false, "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1364" } ], "public": true }, "enforcement": { "summary": "Corporation; derivative holders collectively 5% of class/series at challenged act; 10% equity of parent with majority-owned subsidiary; charter/bylaw designees. Directors do not receive independent standing just by holding office.", "shareholderThreshold": "5% of class/series", "directorStanding": false, "parentThreshold": "10% of parent equity", "otherStanding": "charter/bylaw designees", "corporationStanding": true, "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1362(c)" } ] }, "benefitLiability": { "summary": "Corporation cannot owe monetary damages for missing public-benefit creation. Directors/officers receive compliant-duty and mission-failure damages protection; beneficiary status alone creates no duty.", "corporationMissionDamagesBar": true, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a7\u00a733-1358(c)-(d),33-1360(c)-(d),33-1362(b)" } ] }, "ordinaryExculpation": { "summary": "Charter may cap director damages no lower than compensation received in the year of violation. Excludes knowing culpable law violations, improper economic gain, conscious bad-faith disregard of serious-injury risk, sustained abdication/inattention, and unlawful distributions; no officer clause.", "director": true, "officer": false, "automatic": false, "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_601.htm", "section": "\u00a733-636(b)(4)" } ] }, "statusChange": { "summary": "Default two-thirds of each class/series, including otherwise nonvoting shares. After 24 months, unanimous all-class approval can adopt a legacy lock that restricts exit/transactions and sends residual assets to charities or similarly locked benefit corporations.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds unless legacy lock", "optionalLock": true, "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a7\u00a733-1351(11),33-1354-1356" } ] } }, "costs": { "regularReport": { "amount": 150, "currency": "USD", "cadence": "annual", "conditions": "Domestic stock-corporation annual report.", "summary": "Domestic stock-corporation annual report.", "sources": [ { "url": "https://portal.ct.gov/-/media/sots/business-services/bsd-forms/fee-schedule-revised-712020.pdf", "section": "stock-corporation annual report" } ] }, "benefitReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No state benefit-report filing.", "summary": "No state benefit-report filing.", "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1364" } ] }, "minimumTax": { "amount": 250, "currency": "USD", "cadence": "annual", "conditions": "Corporation business-tax minimum for taxpayers subject to that tax; income/capital bases can be higher and exemptions/tax classification matter.", "summary": "Corporation business-tax minimum for taxpayers subject to that tax; income/capital bases can be higher and exemptions/tax classification matter.", "sources": [ { "url": "https://portal.ct.gov/drs/corporation-tax/tax-information", "section": "Corporation business tax" }, { "label": "Connecticut DRS: corporation tax applicability, income rate, minimum and surtax", "url": "https://portal.ct.gov/drs/corporation-tax/tax-information", "checked": "2026-10-11", "section": "Connecticut DRS: corporation tax applicability, income rate, minimum and surtax" }, { "label": "Connecticut General Assembly: 2026 tax expenditure report, capital-base schedule", "url": "https://www.cga.ct.gov/ofa/Documents/year/TER/2026TER-20260202_%20Tax%20Expenditure%20Report%20FY%2026.pdf", "checked": "2026-10-11", "section": "Connecticut General Assembly: 2026 tax expenditure report, capital-base schedule" }, { "label": "Connecticut statute: section 12-219 capital-base phaseout and minimum", "url": "https://www.cga.ct.gov/2024/sup/chap_208.htm", "checked": "2026-10-11", "section": "Connecticut statute: section 12-219 capital-base phaseout and minimum" } ] } }, "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1357" }, { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a7\u00a733-1358,33-1359" }, { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1363" }, { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1364" }, { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a733-1362(c)" }, { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a7\u00a733-1358(c)-(d),33-1360(c)-(d),33-1362(b)" }, { "url": "https://www.cga.ct.gov/current/pub/chap_601.htm", "section": "\u00a733-636(b)(4)" }, { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a7\u00a733-1351(11),33-1354-1356" }, { "url": "https://portal.ct.gov/-/media/sots/business-services/bsd-forms/fee-schedule-revised-712020.pdf", "section": "stock-corporation annual report" }, { "url": "https://portal.ct.gov/drs/corporation-tax/tax-information", "section": "Corporation business tax" }, { "label": "Connecticut DRS: corporation tax applicability, income rate, minimum and surtax", "url": "https://portal.ct.gov/drs/corporation-tax/tax-information", "checked": "2026-10-11", "section": "Connecticut DRS: corporation tax applicability, income rate, minimum and surtax" }, { "label": "Connecticut General Assembly: 2026 tax expenditure report, capital-base schedule", "url": "https://www.cga.ct.gov/ofa/Documents/year/TER/2026TER-20260202_%20Tax%20Expenditure%20Report%20FY%2026.pdf", "checked": "2026-10-11", "section": "Connecticut General Assembly: 2026 tax expenditure report, capital-base schedule" }, { "label": "Connecticut statute: section 12-219 capital-base phaseout and minimum", "url": "https://www.cga.ct.gov/2024/sup/chap_208.htm", "checked": "2026-10-11", "section": "Connecticut statute: section 12-219 capital-base phaseout and minimum" } ], "differences": [ "Optional legacy lock materially restricts future sale, exit and dissolution distributions.", "5% direct-company and 10% parent standing differ from 2%/5% states.", "Ordinary director damages cap retains at least one year\u2019s compensation." ], "gaps": [ "Entity-specific tax nexus, exemptions and current capital-base computation not modeled." ], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Connecticut offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Connecticut has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter may cap director damages no lower than compensation received in the year of violation. Excludes knowing culpable law violations, improper economic gain, conscious bad-faith disregard of serious-injury risk, sustained abdication/inattention, and unlawful distributions; no officer clause.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Connecticut does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Connecticut requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Connecticut earns the benefit-specific credit for company. Corporation cannot owe monetary damages for missing public-benefit creation. Directors/officers receive compliant-duty and mission-failure damages protection; beneficiary status alone creates no duty.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Connecticut earns the benefit-specific credit for directors. Corporation cannot owe monetary damages for missing public-benefit creation. Directors/officers receive compliant-duty and mission-failure damages protection; beneficiary status alone creates no duty.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Connecticut earns the benefit-specific credit for officers. Corporation cannot owe monetary damages for missing public-benefit creation. Directors/officers receive compliant-duty and mission-failure damages protection; beneficiary status alone creates no duty.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Connecticut: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Connecticut: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Connecticut: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Connecticut has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 3, 3 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 3, 3 ], "reason": "Ordinary reporting $150 + benefit filing $0 = $150 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Connecticut has a compared recurring floor of $400 per year, including $250 in identified minimum tax/license charges. Small active domestic C corporation, regular full year after the first, no taxable profit and sufficiently low capital that the capital-base calculation does not exceed $250. No combined group or special classification is assumed. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Default two-thirds of each class/series, including otherwise nonvoting shares. After 24 months, unanimous all-class approval can adopt a legacy lock that restricts exit/transactions and sends residual assets to charities or similarly locked benefit corporations.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Connecticut: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Default two-thirds of each class/series, including otherwise nonvoting shares. After 24 months, unanimous all-class approval can adopt a legacy lock that restricts exit/transactions and sends residual assets to charities or similarly locked benefit corporations.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Connecticut: changing back requires two-thirds unless legacy lock. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Default two-thirds of each class/series, including otherwise nonvoting shares. After 24 months, unanimous all-class approval can adopt a legacy lock that restricts exit/transactions and sends residual assets to charities or similarly locked benefit corporations.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Connecticut requires report access for people outside the company, so it earns public-access credit. Annual; each shareholder by earlier of 120 days or other annual report. All reports remain public online; latest free on request if no website. No state filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Connecticut: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Connecticut: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Connecticut makes a mission duty mandatory, so it earns this credit. Directors must consider stakeholder effects and mission. Charter can prioritize a specified benefit. Independent benefit director mandatory only for publicly traded corporations; optional for private corporations.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 150, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 400, "minimumTaxAnnualized": 250, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 67, 67 ], "tax": { "code": "CT", "incomeSummary": "Corporation business tax uses a 7.5% net-income rate. A 10% surtax applies to companies with federal total income of at least $100 million and combined unitary filers; it does not apply to the $250 minimum. The surtax is extended through income years beginning in 2028.", "recurringSummary": "Liability is the larger of the income measure and the capital-base measure, with a $250 minimum. The statutory capital-base rate for an income year beginning in 2026 is 0.16%, capped at $1 million before applicable adjustments; the DRS overview still describes the 2025 rate of 0.21%.", "formationAnnualTaxFloor": 250, "floorBasis": "$250 for an ordinary nonexempt corporation with the right to carry on business in Connecticut, separate from the Secretary of State annual-report fee. REITs, regulated investment companies, financial-service companies and other exempt or special classifications need separate treatment. Capital or income may produce a higher tax.", "scenarioMinimum": 250, "scenarioBasis": "Small active domestic C corporation, regular full year after the first, no taxable profit and sufficiently low capital that the capital-base calculation does not exceed $250. No combined group or special classification is assumed.", "operatingTaxCaution": "DRS requires returns from corporations carrying on business or having the right to do so in Connecticut. Income generally follows a Connecticut-sales fraction; capital uses an asset-based apportionment fraction, with special industry rules. An operating address in another formation state does not determine Connecticut liability.", "sources": [ { "label": "Connecticut DRS: corporation tax applicability, income rate, minimum and surtax", "url": "https://portal.ct.gov/drs/corporation-tax/tax-information", "checked": "2026-10-11", "section": "Connecticut DRS: corporation tax applicability, income rate, minimum and surtax" }, { "label": "Connecticut General Assembly: 2026 tax expenditure report, capital-base schedule", "url": "https://www.cga.ct.gov/ofa/Documents/year/TER/2026TER-20260202_%20Tax%20Expenditure%20Report%20FY%2026.pdf", "checked": "2026-10-11", "section": "Connecticut General Assembly: 2026 tax expenditure report, capital-base schedule" }, { "label": "Connecticut statute: section 12-219 capital-base phaseout and minimum", "url": "https://www.cga.ct.gov/2024/sup/chap_208.htm", "checked": "2026-10-11", "section": "Connecticut statute: section 12-219 capital-base phaseout and minimum" } ] }, "conversion": { "state": "Connecticut", "code": "CT", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Default two-thirds of each class/series, including otherwise nonvoting shares. After 24 months, unanimous all-class approval can adopt a legacy lock that restricts exit/transactions and sends residual assets to charities or similarly locked benefit corporations.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.cga.ct.gov/current/pub/chap_604.htm", "section": "\u00a7\u00a733-1351(11),33-1354-1356" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required; specific charter benefits optional and cannot limit the general obligation.", "difference": "Connecticut offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter may cap director damages no lower than compensation received in the year of violation. Excludes knowing culpable law violations, improper economic gain, conscious bad-faith disregard of serious-injury risk, sustained abdication/inattention, and unlawful distributions; no officer clause. Benefit-specific rule: Corporation cannot owe monetary damages for missing public-benefit creation. Directors/officers receive compliant-duty and mission-failure damages protection; beneficiary status alone creates no duty.", "difference": "Connecticut keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Ordinary director damages cap retains at least one year\u2019s compensation." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual; each shareholder by earlier of 120 days or other annual report. All reports remain public online; latest free on request if no website. No state filing. Assessment rule: Third-party assessment standard required. No third-party audit or certification required; selecting/changing standard requires prescribed board/shareholder approval.", "difference": "Connecticut: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $150 per year on an annualized basis. Minimum tax/license used here: $250. Small active domestic C corporation, regular full year after the first, no taxable profit and sufficiently low capital that the capital-base calculation does not exceed $250. No combined group or special classification is assumed.", "difference": "Connecticut has a compared recurring floor of $400 per year, including $250 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Default two-thirds of each class/series, including otherwise nonvoting shares. After 24 months, unanimous all-class approval can adopt a legacy lock that restricts exit/transactions and sends residual assets to charities or similarly locked benefit corporations. Changing back: two-thirds unless legacy lock", "difference": "Connecticut entry uses two-thirds of each class, including nonvoting; exit uses two-thirds unless legacy lock. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider stakeholder effects and mission. Charter can prioritize a specified benefit. Independent benefit director mandatory only for publicly traded corporations; optional for private corporations. Disclosure: Annual; each shareholder by earlier of 120 days or other annual report. All reports remain public online; latest free on request if no website. No state filing. Enforcement: Corporation; derivative holders collectively 5% of class/series at challenged act; 10% equity of parent with majority-owned subsidiary; charter/bylaw designees. Directors do not receive independent standing just by holding office.", "difference": "Connecticut requires public access to the report. Optional legacy lock materially restricts future sale, exit and dissolution distributions." } } }, "guideUrl": "/assets/state-guides/CT.md" }, { "state": "Delaware", "abbreviation": "DE", "form": "Public benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "specific-benefit balancing", "features": { "purpose": { "summary": "Charter identifies one or more specific public benefits; the model general-public-benefit purpose is not separately mandated.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7362" } ], "generalRequired": false, "specificRequired": true, "specificOptional": false }, "board": { "summary": "Balance stockholder financial interests, materially affected persons, and the charter benefit.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7365(a)" } ], "mode": "mandatory_three_interest_balance" }, "standard": { "summary": "Third-party standard, public release and certification are optional governing-document commitments.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7366(c)" } ], "thirdPartyRequired": false, "certificationRequired": false }, "report": { "summary": "At least biennial stockholder statement; more frequent or public reporting can be elected.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7366" } ], "cadence": "biennial", "shareholders": true, "publicWebsite": false, "stateFiling": false, "public": false }, "enforcement": { "summary": "Balancing actions require 2% of all outstanding shares, or for listed companies the lower $2 million alternative. Other derivative conditions remain.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7367" } ], "shareholderThreshold": "2% total outstanding; listed-company lower $2m alternative" }, "benefitLiability": { "summary": "Informed, disinterested, non-irrational decisions satisfy the duty. No duty to benefit beneficiaries solely as such. Absent conflict, balancing failure is not bad faith or disloyalty for exculpation/indemnification unless charter changes this.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7365(b)\u2013(c)" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": "conditional safe harbor", "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "Opt-in charter protection for directors and eligible officers. Exceptions include loyalty, bad faith, intentional misconduct, knowing illegality and improper benefit. Officer coverage excludes corporation/derivative claims; directors also retain unlawful-distribution exposure.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc01/index.html", "section": "\u00a7102(b)(7)" } ], "director": true, "officer": true, "automatic": false }, "statusChange": { "summary": "No special PBC supermajority remains for ordinary stock corporations. Use normal charter-amendment/transaction rules: ordinarily majority outstanding entitled shares, with applicable class votes and charter requirements.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc08/index.html", "section": "\u00a7242(b)" }, { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7363" }, { "url": "https://delcode.delaware.gov/title8/c001/sc08/index.html#242", "section": "DGCL \u00a7242 \u2014 amendment approval" }, { "url": "https://legis.delaware.gov/BillDetail/48122", "section": "2020 HB 341 \u2014 entry/appraisal reform" } ], "entryVote": "ordinary", "exitVote": "ordinary", "optionalLock": false } }, "costs": { "regularReport": { "amount": 50, "cadence": "annual", "conditions": "Domestic stock corporation annual report.", "summary": "Domestic stock corporation annual report.", "sources": [ { "url": "https://corp.delaware.gov/frtax/", "section": "Annual report fee" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate PBC report filing mandated.", "summary": "No separate PBC report filing mandated.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7366" } ] }, "minimumTax": { "amount": 175, "conditions": "Authorized-shares method minimum; assumed-par method minimum $400. Share/asset structure can increase tax. $50 annual report makes the known total $225 or $450 minimum.", "summary": "Authorized-shares method minimum; assumed-par method minimum $400. Share/asset structure can increase tax. $50 annual report makes the known total $225 or $450 minimum.", "sources": [ { "url": "https://corp.delaware.gov/frtax/", "section": "Franchise tax methods" }, { "label": "Delaware Division of Corporations: annual report and franchise-tax methods", "url": "https://corp.delaware.gov/frtax/", "checked": "2026-10-11", "section": "Delaware Division of Corporations: annual report and franchise-tax methods" }, { "label": "Delaware Code: corporate income tax, exemptions and current apportionment", "url": "https://www.delcode.delaware.gov/title30/c019/index.html", "checked": "2026-10-11", "section": "Delaware Code: corporate income tax, exemptions and current apportionment" }, { "label": "Delaware DOR: current business-license and gross-receipts rate schedule", "url": "https://revenuefiles.delaware.gov/docs/gr_rates.pdf", "checked": "2026-10-11", "section": "Delaware DOR: current business-license and gross-receipts rate schedule" }, { "label": "Delaware DOR: legal business structures, including public benefit corporations", "url": "https://revenuefiles.delaware.gov/docs/business_structures_table.pdf", "checked": "2026-10-11", "section": "Delaware DOR: legal business structures, including public benefit corporations" } ] } }, "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7362" }, { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7365(a)" }, { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7366(c)" }, { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7366" }, { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7367" }, { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7365(b)\u2013(c)" }, { "url": "https://delcode.delaware.gov/title8/c001/sc01/index.html", "section": "\u00a7102(b)(7)" }, { "url": "https://delcode.delaware.gov/title8/c001/sc08/index.html", "section": "\u00a7242(b)" }, { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7363" }, { "url": "https://corp.delaware.gov/frtax/", "section": "Annual report fee" }, { "url": "https://corp.delaware.gov/frtax/", "section": "Franchise tax methods" }, { "label": "Delaware Division of Corporations: annual report and franchise-tax methods", "url": "https://corp.delaware.gov/frtax/", "checked": "2026-10-11", "section": "Delaware Division of Corporations: annual report and franchise-tax methods" }, { "label": "Delaware Code: corporate income tax, exemptions and current apportionment", "url": "https://www.delcode.delaware.gov/title30/c019/index.html", "checked": "2026-10-11", "section": "Delaware Code: corporate income tax, exemptions and current apportionment" }, { "label": "Delaware DOR: current business-license and gross-receipts rate schedule", "url": "https://revenuefiles.delaware.gov/docs/gr_rates.pdf", "checked": "2026-10-11", "section": "Delaware DOR: current business-license and gross-receipts rate schedule" }, { "label": "Delaware DOR: legal business structures, including public benefit corporations", "url": "https://revenuefiles.delaware.gov/docs/business_structures_table.pdf", "checked": "2026-10-11", "section": "Delaware DOR: legal business structures, including public benefit corporations" }, { "url": "https://delcode.delaware.gov/title8/c001/sc08/index.html#242", "section": "DGCL \u00a7242 \u2014 amendment approval" }, { "url": "https://legis.delaware.gov/BillDetail/48122", "section": "2020 HB 341 \u2014 entry/appraisal reform" } ], "differences": [ "Biennial private shareholder reporting contrasts with most annual public-report states.", "Eligible officer charter protection is narrower than director protection.", "Delaware\u2019s broad corporate adoption supports investor familiarity as an inference, not a valuation or financing guarantee." ], "gaps": [ "Financing suitability, court outcomes, actual taxes and operating-state registration require facts specific to the company." ], "confidence": "Current code and agency fee schedule", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Public benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Delaware offers Public benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 12, 12 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Delaware has an identified director monetary-protection provision in the compared scope, which earns this credit. Opt-in charter protection for directors and eligible officers. Exceptions include loyalty, bad faith, intentional misconduct, knowing illegality and improper benefit. Officer coverage excludes corporation/derivative claims; directors also retain unlawful-distribution exposure.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 4, 4 ], "reason": "The model assigns 4 points to this designated eligible-officer provision; officer eligibility and excluded claims remain in the legal record.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Delaware extends ordinary protection to officers in a limited eligible-officer scope, so it receives less credit than the broader officer category. Opt-in charter protection for directors and eligible officers. Exceptions include loyalty, bad faith, intentional misconduct, knowing illegality and improper benefit. Officer coverage excludes corporation/derivative claims; directors also retain unlawful-distribution exposure.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Delaware requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit decision / classification safe harbor", "range": [ 2, 2 ], "reason": "2 points instead of the separate company/director/officer outcome-bar credits. The cited safe harbor is not treated as a blanket mission-failure damages bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection for benefit decisions", "why": "Delaware protects certain properly made or classified benefit decisions. This is narrower than an express company/director/officer bar on damages merely for missing the mission, so only the narrower safe-harbor credit applies. Informed, disinterested, non-irrational decisions satisfy the duty. No duty to benefit beneficiaries solely as such. Absent conflict, balancing failure is not bad faith or disloyalty for exculpation/indemnification unless charter changes this.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 23, 23 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 8, 8 ], "reason": "At least biennial reporting receives 8 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Delaware: At least biennial. This gets more ease-of-operation credit than an annual mandate because reporting is less frequent or not mandatory.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Delaware: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Delaware: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Delaware has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 6, 6 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 6, 6 ], "reason": "Ordinary reporting $50 + benefit filing $0 = $50 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Delaware has a compared recurring floor of $300 per year, including $250 in identified minimum tax/license charges. Active domestic general-services C corporation operating at one Delaware location in a regular year, at the $175 authorized-shares franchise minimum plus the $75 annual DOR business license; no taxable profit and receipts within the category's gross-receipts exclusion. Add the separate $50 registry report only once. If comparing formation-only companies operating entirely elsewhere, use $175 instead. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 10, 10 ], "reason": "No special PBC supermajority remains for ordinary stock corporations. Use normal charter-amendment/transaction rules: ordinarily majority outstanding entitled shares, with applicable class votes and charter requirements.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Delaware: becoming a benefit company requires Board approval plus a majority of all outstanding stock entitled to vote; applicable separate class votes and higher charter requirements remain. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 10, 10 ], "reason": "No added benefit-status supermajority: 10 points. Ordinary transaction votes and any higher charter votes still apply. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Delaware: changing back requires ordinary. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 6, 6 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No statutory public benefit-report access mandate: 0 points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Delaware has no mandatory public access in the compared variant, so it gets no public-access credit. Voluntary publication is still possible. At least biennial stockholder statement; more frequent or public reporting can be elected.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 3, 3 ], "reason": "At least biennial reporting: 3 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Delaware: At least biennial. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Delaware: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Delaware makes a mission duty mandatory, so it earns this credit. Balance stockholder financial interests, materially affected persons, and the charter benefit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 50, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "ordinary", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 300, "minimumTaxAnnualized": 250, "entryCategory": "ordinary" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "At least biennial", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Ordinary transaction votes" }, "scoreRange": [ 69, 69 ], "tax": { "code": "DE", "incomeSummary": "Nonexempt C corporations pay 8.7% of Delaware taxable income. Merely maintaining a statutory corporate office without doing business in Delaware is an express income-tax exemption. Ordinary multistate corporations use the current statutory sales-factor apportionment, not the obsolete equally weighted three-factor description on some agency pages.", "recurringSummary": "Domestic stock corporations owe franchise tax: authorized-shares method minimum $175, or assumed-par-value-capital method minimum $400. The separate annual-report fee is $50. A general-services business actually operating in Delaware also needs a $75 annual business license for its first location; gross-receipts tax is 0.3983% above the applicable $100,000 monthly exclusion for that category.", "formationAnnualTaxFloor": 175, "floorBasis": "Lowest franchise tax for a nonexempt domestic stock corporation using the authorized-shares method with no more than 5,000 authorized shares. Excludes the separate $50 annual report, the $75 operating-business license, gross-receipts and income tax, other locations, late charges and registered-agent cost. A venture-style share structure may instead produce at least $400.", "scenarioMinimum": 250, "scenarioBasis": "Active domestic general-services C corporation operating at one Delaware location in a regular year, at the $175 authorized-shares franchise minimum plus the $75 annual DOR business license; no taxable profit and receipts within the category's gross-receipts exclusion. Add the separate $50 registry report only once. If comparing formation-only companies operating entirely elsewhere, use $175 instead.", "operatingTaxCaution": "Delaware Code sections 1902\u20131904 separate incorporation-only exemptions from business income sourced to Delaware and require nonexempt returns even without taxable income. Business-license and gross-receipts classifications follow actual activity. A Delaware charter does not eliminate income, franchise, sales or payroll taxes in states where the company operates.", "benefitTaxTreatment": "The Delaware Division of Revenue's legal-business-structures table describes a public benefit corporation as paying business income tax at the corporate rate and using the corporate authorized-share or assumed-capital fee framework; benefit status does not itself supply tax exemption.", "sources": [ { "label": "Delaware Division of Corporations: annual report and franchise-tax methods", "url": "https://corp.delaware.gov/frtax/", "checked": "2026-10-11", "section": "Delaware Division of Corporations: annual report and franchise-tax methods" }, { "label": "Delaware Code: corporate income tax, exemptions and current apportionment", "url": "https://www.delcode.delaware.gov/title30/c019/index.html", "checked": "2026-10-11", "section": "Delaware Code: corporate income tax, exemptions and current apportionment" }, { "label": "Delaware DOR: current business-license and gross-receipts rate schedule", "url": "https://revenuefiles.delaware.gov/docs/gr_rates.pdf", "checked": "2026-10-11", "section": "Delaware DOR: current business-license and gross-receipts rate schedule" }, { "label": "Delaware DOR: legal business structures, including public benefit corporations", "url": "https://revenuefiles.delaware.gov/docs/business_structures_table.pdf", "checked": "2026-10-11", "section": "Delaware DOR: legal business structures, including public benefit corporations" } ] }, "conversion": { "state": "Delaware", "code": "DE", "form": "Public benefit corporation", "status": "Available", "group": "ordinary", "groupLabel": "Ordinary / qualified-majority route", "entryVote": "Board approval plus a majority of all outstanding stock entitled to vote; applicable separate class votes and higher charter requirements remain.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "No special PBC supermajority remains for ordinary stock corporations. Use normal charter-amendment/transaction rules: ordinarily majority outstanding entitled shares, with applicable class votes and charter requirements.", "proposal": "Preserve ordinary-amendment entry and no extra status-only appraisal; explain the specific benefit, shareholder notices and remaining charter/class rights.", "sources": [ { "url": "https://delcode.delaware.gov/title8/c001/sc08/index.html", "section": "\u00a7242(b)" }, { "url": "https://delcode.delaware.gov/title8/c001/sc15/index.html", "section": "\u00a7363" }, { "url": "https://delcode.delaware.gov/title8/c001/sc08/index.html#242", "section": "DGCL \u00a7242 \u2014 amendment approval" }, { "url": "https://legis.delaware.gov/BillDetail/48122", "section": "2020 HB 341 \u2014 entry/appraisal reform" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Charter identifies one or more specific public benefits; the model general-public-benefit purpose is not separately mandated.", "difference": "Delaware offers Public benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Opt-in charter protection for directors and eligible officers. Exceptions include loyalty, bad faith, intentional misconduct, knowing illegality and improper benefit. Officer coverage excludes corporation/derivative claims; directors also retain unlawful-distribution exposure. Benefit-specific rule: Informed, disinterested, non-irrational decisions satisfy the duty. No duty to benefit beneficiaries solely as such. Absent conflict, balancing failure is not bad faith or disloyalty for exculpation/indemnification unless charter changes this.", "difference": "Delaware adds ordinary officer coverage; the charter must elect the ordinary protection. Eligible officer charter protection is narrower than director protection." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "At least biennial stockholder statement; more frequent or public reporting can be elected. Assessment rule: Third-party standard, public release and certification are optional governing-document commitments.", "difference": "Delaware: At least biennial; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $50 per year on an annualized basis. Minimum tax/license used here: $250. Active domestic general-services C corporation operating at one Delaware location in a regular year, at the $175 authorized-shares franchise minimum plus the $75 annual DOR business license; no taxable profit and receipts within the category's gross-receipts exclusion. Add the separate $50 registry report only once. If comparing formation-only companies operating entirely elsewhere, use $175 instead.", "difference": "Delaware has a compared recurring floor of $300 per year, including $250 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Board approval plus a majority of all outstanding stock entitled to vote; applicable separate class votes and higher charter requirements remain. No special PBC supermajority remains for ordinary stock corporations. Use normal charter-amendment/transaction rules: ordinarily majority outstanding entitled shares, with applicable class votes and charter requirements. Changing back: ordinary", "difference": "Delaware entry uses Board approval plus a majority of all outstanding stock entitled to vote; applicable separate class votes and higher charter requirements remain.; exit uses ordinary. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Balance stockholder financial interests, materially affected persons, and the charter benefit. Disclosure: At least biennial stockholder statement; more frequent or public reporting can be elected. Enforcement: Balancing actions require 2% of all outstanding shares, or for listed companies the lower $2 million alternative. Other derivative conditions remain.", "difference": "Delaware does not require public access in this compared variant. Biennial private shareholder reporting contrasts with most annual public-report states." } } }, "guideUrl": "/assets/state-guides/DE.md" }, { "state": "Florida", "abbreviation": "FL", "form": "Benefit corporation; also social purpose corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit mandatory stakeholder model", "features": { "purpose": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.606", "section": "Fla. Stat. 607.606" } ], "confidence": "high", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is required; specific public benefits are optional and do not narrow it." }, "board": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.607", "section": "Fla. Stat. 607.607" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.608", "section": "Fla. Stat. 607.608" } ], "confidence": "high", "mode": "mandatory_stakeholder_consideration", "summary": "Directors shall consider the listed stakeholders and purposes. Neither priority nor equal weighting is required unless articles require it; benefit-director role is optional." }, "standard": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.612", "section": "Fla. Stat. 607.612" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.612", "section": "Fla. Stat. 607.612" } ], "confidence": "high", "required": true, "summary": "Annual benefit report must be prepared using a third-party standard. Neither annual report nor assessment requires third-party audit or certification.", "thirdPartyRequired": true, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.612", "section": "Fla. Stat. 607.612" } ], "confidence": "high", "required": false, "summary": "Neither annual report nor assessment requires third-party audit or certification." }, "report": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.612", "section": "Fla. Stat. 607.612" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.613", "section": "Fla. Stat. 607.613" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "summary": "Annual shareholder delivery within 120 days after year-end or with other annual report. Each report must stay on public website at least three years; latest free copy if no website. Shareholders can obtain summary court enforcement and costs. No state benefit-report filing specified." }, "enforcement": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.611", "section": "Fla. Stat. 607.611" } ], "confidence": "high", "threshold": "any_record_shareholder_at_act", "summary": "Corporation directly; derivative claim by any shareholder of record on act/inaction date, a director, 5% parent-equity holders, or charter/bylaw designees." }, "benefitLiability": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.611", "section": "Fla. Stat. 607.611" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.607", "section": "Fla. Stat. 607.607" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.609", "section": "Fla. Stat. 607.609" } ], "confidence": "high", "company": true, "directors": true, "officers": true, "summary": "Company is not liable under benefit part for monetary damages for benefit failure. Director/officer benefit-failure monetary protection applies unless articles provide otherwise; ordinary duties remain." }, "ordinaryExculpation": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.0831", "section": "Fla. Stat. 607.0831" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.0841", "section": "Fla. Stat. 607.0841: officer duties" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.0202", "section": "Fla. Stat. 607.0202: permissible articles provisions" } ], "confidence": "high", "director": true, "officer": false, "optIn": false, "summary": "Automatic director-only monetary-liability limitation under section 607.0831: breach plus criminal violation (reasonable-lawfulness exception), improper benefit, unlawful distribution, internal conscious disregard/willful misconduct, or outsider recklessness/bad faith/malicious or wanton misconduct. Officers are not within this director immunity provision; section 607.0841 assigns officer duties, and section 607.0202 supplies no equivalent express officer-exculpation authorization. Separate indemnification and insurance mechanisms have different conditions.", "automatic": true }, "statusChange": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.602", "section": "Fla. Stat. 607.602" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.604", "section": "Fla. Stat. 607.604" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.605", "section": "Fla. Stat. 607.605" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.606", "section": "Fla. Stat. 607.606" } ], "confidence": "high", "entry": "2/3 each class/series", "exit": "2/3 each class/series", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "Entry, exit and specific-benefit amendments require 2/3 of each class/series including nonvoting. Appraisal rights accompany entry/exit. Asset-sale minimum-vote rule has ordinary-course, court-order and distribution-of-proceeds exceptions.", "exitVote": "2/3 each class/series", "entryVote": "2/3 each class/series" } }, "costs": { "regularReport": { "sources": [ { "url": "https://dos.fl.gov/sunbiz/manage-business/efile/annual-report/", "section": "Annual Report Fees: Profit Corporation" } ], "confidence": "high", "amount": 150, "cadence": "annual", "online": 150, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Timely ordinary annual report for a profit corporation is $150.", "conditions": "Timely ordinary annual report for a profit corporation is $150." }, "benefitReport": { "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.613", "section": "Fla. Stat. 607.613" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://floridarevenue.com/taxes/taxesfees/Pages/corporate.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Florida DOR: corporate income/franchise tax, rates, formula and filing", "url": "https://floridarevenue.com/taxes/taxesfees/Pages/corporate.aspx", "checked": "2026-10-11", "section": "Florida DOR: corporate income/franchise tax, rates, formula and filing" }, { "label": "Florida DOR: current F-1120 instructions, including controlled-group exemption", "url": "https://floridarevenue.com/Forms_library/current/f1120n.pdf", "checked": "2026-10-11", "section": "Florida DOR: current F-1120 instructions, including controlled-group exemption" } ], "confidence": "high", "amount": 0, "cadence": "annual; liability depends on applicable tax base/exemptions", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "calculationRequired": true, "universalFlatMinimum": false, "summary": "Income-based corporation income/franchise tax: 5.5% of Florida net income after apportionment/adjustments and a $50,000 exemption. Zero tax can result when the taxable base is zero; there is no flat annual franchise minimum comparable to Delaware. Required returns can remain due with zero tax. This is separate from the $150 annual registry report.", "conditions": "Income-based corporation income/franchise tax: 5.5% of Florida net income after apportionment/adjustments and a $50,000 exemption. Zero tax can result when the taxable base is zero; there is no flat annual franchise minimum comparable to Delaware. Required returns can remain due with zero tax. This is separate from the $150 annual registry report." } }, "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.606", "section": "Fla. Stat. 607.606" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.607", "section": "Fla. Stat. 607.607" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.608", "section": "Fla. Stat. 607.608" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.612", "section": "Fla. Stat. 607.612" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.613", "section": "Fla. Stat. 607.613" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.611", "section": "Fla. Stat. 607.611" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.609", "section": "Fla. Stat. 607.609" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.0831", "section": "Fla. Stat. 607.0831" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.0841", "section": "Fla. Stat. 607.0841: officer duties" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.0202", "section": "Fla. Stat. 607.0202: permissible articles provisions" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.602", "section": "Fla. Stat. 607.602" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.604", "section": "Fla. Stat. 607.604" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.605", "section": "Fla. Stat. 607.605" }, { "url": "https://dos.fl.gov/sunbiz/manage-business/efile/annual-report/", "section": "Annual Report Fees: Profit Corporation" }, { "url": "https://floridarevenue.com/taxes/taxesfees/Pages/corporate.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Florida DOR: corporate income/franchise tax, rates, formula and filing", "url": "https://floridarevenue.com/taxes/taxesfees/Pages/corporate.aspx", "checked": "2026-10-11", "section": "Florida DOR: corporate income/franchise tax, rates, formula and filing" }, { "label": "Florida DOR: current F-1120 instructions, including controlled-group exemption", "url": "https://floridarevenue.com/Forms_library/current/f1120n.pdf", "checked": "2026-10-11", "section": "Florida DOR: current F-1120 instructions, including controlled-group exemption" } ], "differences": [ "Public report retention floor is three years.", "Articles can change director/officer benefit-failure protection and weighting rules.", "Any contemporaneous record shareholder can enforce; no percentage floor.", "Florida also offers a distinct social purpose corporation; this record compares the benefit corporation option, which requires general public benefit." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation; also social purpose corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Florida offers Benefit corporation; also social purpose corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 19, 19 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Florida has an identified director monetary-protection provision in the compared scope, which earns this credit. Automatic director-only monetary-liability limitation under section 607.0831: breach plus criminal violation (reasonable-lawfulness exception), improper benefit, unlawful distribution, internal conscious disregard/willful misconduct, or outsider recklessness/bad faith/malicious or wanton misconduct. Officers are not within this director immunity provision; section 607.0841 assigns officer duties, and section 607.0202 supplies no equivalent express officer-exculpation authorization. Separate indemnification and insurance mechanisms have different conditions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Florida does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 3, 3 ], "reason": "Statutory coverage in the selected scope receives the 3-point default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Florida has a default statutory liability rule in the compared scope, so it earns the automatic-coverage credit. Articles and retained exceptions still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Florida earns the benefit-specific credit for company. Company is not liable under benefit part for monetary damages for benefit failure. Director/officer benefit-failure monetary protection applies unless articles provide otherwise; ordinary duties remain.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Florida earns the benefit-specific credit for directors. Company is not liable under benefit part for monetary damages for benefit failure. Director/officer benefit-failure monetary protection applies unless articles provide otherwise; ordinary duties remain.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Florida earns the benefit-specific credit for officers. Company is not liable under benefit part for monetary damages for benefit failure. Director/officer benefit-failure monetary protection applies unless articles provide otherwise; ordinary duties remain.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Florida: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Florida: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Florida: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Florida has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 9, 9 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 9, 9 ], "reason": "Ordinary reporting $150 + benefit filing $0 = $150 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Florida has a compared recurring floor of $150 per year, including $0 in identified minimum tax/license charges. Small active domestic C corporation in a regular year with no Florida net taxable income after state modifications, allocation/apportionment and its available exemption. This excludes the annual report and all non-income operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry, exit and specific-benefit amendments require 2/3 of each class/series including nonvoting. Appraisal rights accompany entry/exit. Asset-sale minimum-vote rule has ordinary-course, court-order and distribution-of-proceeds exceptions.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Florida: becoming a benefit company requires 2/3 each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Florida: changing back requires 2/3 each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Florida requires report access for people outside the company, so it earns public-access credit. Annual shareholder delivery within 120 days after year-end or with other annual report. Each report must stay on public website at least three years; latest free copy if no website. Shareholders can obtain summary court enforcement and costs. No state benefit-report filing specified.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Florida: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Florida: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Florida makes a mission duty mandatory, so it earns this credit. Directors shall consider the listed stakeholders and purposes. Neither priority nor equal weighting is required unless articles require it; benefit-director role is optional.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 150, "ordinaryScope": { "director": true, "officer": false, "automatic": true }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "Benefit corporation", "recurringMinimumAnnualized": 150, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 76, 76 ], "tax": { "code": "FL", "incomeSummary": "Florida's corporate income/franchise tax is 5.5% for tax years beginning on or after January 1, 2022. The state calculates adjusted federal income, apportions and allocates it to Florida, then applies a $50,000 exemption; controlled groups share that exemption.", "recurringSummary": "The tax called corporate income/franchise tax is income-based; the published formula has no separate fixed-dollar annual franchise minimum. A $0 income-tax calculation does not eliminate the separate profit-corporation annual-report fee or other operating taxes. Corporations generally must file even when no income tax is due.", "formationAnnualTaxFloor": null, "floorBasis": "No fixed tax imposed solely by domestic stock-corporation status is identified in the cited corporate-tax formula. Zero is a taxable-income/exemption result, not an all-cost floor. The Secretary of State report, local licenses, property, sales and payroll taxes are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active domestic C corporation in a regular year with no Florida net taxable income after state modifications, allocation/apportionment and its available exemption. This excludes the annual report and all non-income operating taxes.", "operatingTaxCaution": "Florida's ordinary apportionment weights property 25%, payroll 25% and sales 50%, with separately allocated nonbusiness income and special rules. A corporation doing business, earning income or existing in Florida can have a filing obligation; an out-of-state charter is not an exemption.", "sources": [ { "label": "Florida DOR: corporate income/franchise tax, rates, formula and filing", "url": "https://floridarevenue.com/taxes/taxesfees/Pages/corporate.aspx", "checked": "2026-10-11", "section": "Florida DOR: corporate income/franchise tax, rates, formula and filing" }, { "label": "Florida DOR: current F-1120 instructions, including controlled-group exemption", "url": "https://floridarevenue.com/Forms_library/current/f1120n.pdf", "checked": "2026-10-11", "section": "Florida DOR: current F-1120 instructions, including controlled-group exemption" } ] }, "conversion": { "state": "Florida", "code": "FL", "form": "Benefit corporation; also social purpose corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 each class/series", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry, exit and specific-benefit amendments require 2/3 of each class/series including nonvoting. Appraisal rights accompany entry/exit. Asset-sale minimum-vote rule has ordinary-course, court-order and distribution-of-proceeds exceptions.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.602", "section": "Fla. Stat. 607.602" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.604", "section": "Fla. Stat. 607.604" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.605", "section": "Fla. Stat. 607.605" }, { "url": "https://www.flsenate.gov/Laws/Statutes/2026/607.606", "section": "Fla. Stat. 607.606" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is required; specific public benefits are optional and do not narrow it.", "difference": "Florida offers Benefit corporation; also social purpose corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Automatic director-only monetary-liability limitation under section 607.0831: breach plus criminal violation (reasonable-lawfulness exception), improper benefit, unlawful distribution, internal conscious disregard/willful misconduct, or outsider recklessness/bad faith/malicious or wanton misconduct. Officers are not within this director immunity provision; section 607.0841 assigns officer duties, and section 607.0202 supplies no equivalent express officer-exculpation authorization. Separate indemnification and insurance mechanisms have different conditions. Benefit-specific rule: Company is not liable under benefit part for monetary damages for benefit failure. Director/officer benefit-failure monetary protection applies unless articles provide otherwise; ordinary duties remain.", "difference": "Florida keeps this ordinary shield limited to directors and a default statutory liability rule. Articles can change director/officer benefit-failure protection and weighting rules." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder delivery within 120 days after year-end or with other annual report. Each report must stay on public website at least three years; latest free copy if no website. Shareholders can obtain summary court enforcement and costs. No state benefit-report filing specified. Assessment rule: Annual benefit report must be prepared using a third-party standard. Neither annual report nor assessment requires third-party audit or certification.", "difference": "Florida: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $150 per year on an annualized basis. Minimum tax/license used here: $0. Small active domestic C corporation in a regular year with no Florida net taxable income after state modifications, allocation/apportionment and its available exemption. This excludes the annual report and all non-income operating taxes.", "difference": "Florida has a compared recurring floor of $150 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 each class/series. Entry, exit and specific-benefit amendments require 2/3 of each class/series including nonvoting. Appraisal rights accompany entry/exit. Asset-sale minimum-vote rule has ordinary-course, court-order and distribution-of-proceeds exceptions. Changing back: 2/3 each class/series", "difference": "Florida entry uses 2/3 each class/series; exit uses 2/3 each class/series. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors shall consider the listed stakeholders and purposes. Neither priority nor equal weighting is required unless articles require it; benefit-director role is optional. Disclosure: Annual shareholder delivery within 120 days after year-end or with other annual report. Each report must stay on public website at least three years; latest free copy if no website. Shareholders can obtain summary court enforcement and costs. No state benefit-report filing specified. Enforcement: Corporation directly; derivative claim by any shareholder of record on act/inaction date, a director, 5% parent-equity holders, or charter/bylaw designees.", "difference": "Florida requires public access to the report. Public report retention floor is three years. Any contemporaneous record shareholder can enforce; no percentage floor. Florida also offers a distinct social purpose corporation; this record compares the benefit corporation option, which requires general public benefit." } } }, "guideUrl": "/assets/state-guides/FL.md" }, { "state": "Georgia", "abbreviation": "GA", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "Specified-benefit / board-selected-standard model", "features": { "purpose": { "summary": "Charter must state one or more identified public benefits. Article 18 does not require the model-law general-whole-society purpose.", "generalRequired": false, "specificRequired": true, "specificOptional": false, "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1802" } ] }, "board": { "summary": "Directors must consider the identified public benefits and adopt performance standards. No explicit Delaware-style balancing rule or mandatory multi-stakeholder list. No independent benefit director required.", "mode": "mandatory_consider_specified_benefit", "benefitDirectorRequired": "none", "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1806(a)" } ] }, "standard": { "summary": "Board-selected standards required; external third-party standard and certification optional unless added in charter/bylaws.", "thirdPartyRequired": false, "certificationRequired": false, "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a7\u00a714-2-1806(a)(3),1807(c)" } ] }, "report": { "summary": "At least annual to record shareholders and anyone requesting in writing. General internet publication, more frequent reports, third-party standards/certification can be added voluntarily. No state benefit filing.", "cadence": "annual", "shareholders": true, "publicWebsite": "optional; written-request access mandatory", "stateFiling": false, "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1807" } ], "public": true }, "enforcement": { "summary": "No bespoke benefit-enforcement ownership threshold in Article 18. Ordinary derivative law requires contemporaneous ownership and adequate representation; nationally listed companies may set a threshold up to 1% under 2026 law.", "shareholderThreshold": "ordinary derivative standing; listed companies may require up to 1%", "directorStanding": null, "parentThreshold": null, "otherStanding": "No special benefit-enforcement list in Article 18", "corporationStanding": null, "sources": [ { "url": "https://gov.georgia.gov/document/2026-signed-legislation/hb-1185/download", "section": "HB1185 \u00a7\u00a74,21, amending \u00a714-2-741" }, { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a7\u00a714-2-1801-1807" } ] }, "benefitLiability": { "summary": "Unless charter overrides, directors owe no monetary liability to any person for benefit-duty failures or failure to pursue specified benefit. Article 18 contains no corresponding express officer or corporation mission-failure bar.", "corporationMissionDamagesBar": false, "directorMissionDamagesBar": true, "officerMissionDamagesBar": false, "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1806(b)" } ] }, "ordinaryExculpation": { "summary": "From July 1, 2026, charter may exculpate directors and officers against corporation/shareholder damages. Excludes corporate-opportunity appropriation, intentional misconduct/knowing law violations, unlawful distributions and improper personal benefit. Charter/bylaws may select Georgia State-wide Business Court for lawful internal claims.", "director": true, "officer": true, "automatic": false, "sources": [ { "url": "https://gov.georgia.gov/document/2026-signed-legislation/hb-1185/download", "section": "HB1185 \u00a7\u00a72-3,21; \u00a7\u00a714-2-202(b)(4)-(6),206(c)" } ] }, "statusChange": { "summary": "Two-thirds of every class/series, including nonvoting, for entry, substantive benefit alteration/deletion, and covered transactions that transfer ownership/assets outside a substantially similar benefit purpose.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds; includes substantive mission modification", "optionalLock": false, "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1805" } ] } }, "costs": { "regularReport": { "amount": 60, "currency": "USD", "cadence": "annual", "conditions": "Effective September 6, 2025, annual registration for a benefit/profit corporation is $60 online or on paper: $50 filing fee plus $10 service charge. This excludes late and optional expedited charges.", "paperAmount": 60, "electronicAmount": 60, "summary": "Effective September 6, 2025, annual registration for a benefit/profit corporation is $60 online or on paper: $50 filing fee plus $10 service charge. This excludes late and optional expedited charges.", "sources": [ { "url": "https://sos.ga.gov/how-to-guide/how-guide-register-domestic-entity", "section": "annual registration fee" }, { "url": "https://sos.ga.gov/sites/default/files/forms/Reference%20-%20Filing%20Fees.pdf", "section": "Corporations Division Filing Fees, effective September 6, 2025; Annual Registration (Profit Corp., Professional Corp., Benefit Corp.), both filing methods" } ] }, "benefitReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No state benefit-report filing in Article 18.", "summary": "No state benefit-report filing in Article 18.", "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1807" } ] }, "minimumTax": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No net-worth tax at net worth $100,000 or less, but return required. Higher net worth produces tax up to $5,000; income-based tax is separate.", "summary": "No net-worth tax at net worth $100,000 or less, but return required. Higher net worth produces tax up to $5,000; income-based tax is separate.", "sources": [ { "url": "https://dor.georgia.gov/taxes/corporate-income-and-net-worth-tax", "section": "Net Worth Tax" }, { "label": "Governor of Georgia: May 11, 2026 enactment and January 1 effective date", "url": "https://gov.georgia.gov/press-releases/2026-05-11/gov-kemp-signs-legislation-lowering-taxes-and-supporting-economic-growth", "checked": "2026-10-11", "section": "Governor of Georgia: May 11, 2026 enactment and January 1 effective date" }, { "label": "Georgia Department of Economic Development: 2026 corporate rate and apportionment", "url": "https://georgia.org/business-support/incentives", "checked": "2026-10-11", "section": "Georgia Department of Economic Development: 2026 corporate rate and apportionment" }, { "label": "Georgia DOR: corporate net-worth tax and initial filing", "url": "https://dor.georgia.gov/taxes/corporate-income-and-net-worth-tax", "checked": "2026-10-11", "section": "Georgia DOR: corporate net-worth tax and initial filing" } ] } }, "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1802" }, { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1806(a)" }, { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a7\u00a714-2-1806(a)(3),1807(c)" }, { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1807" }, { "url": "https://gov.georgia.gov/document/2026-signed-legislation/hb-1185/download", "section": "HB1185 \u00a7\u00a74,21, amending \u00a714-2-741" }, { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a7\u00a714-2-1801-1807" }, { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1806(b)" }, { "url": "https://gov.georgia.gov/document/2026-signed-legislation/hb-1185/download", "section": "HB1185 \u00a7\u00a72-3,21; \u00a7\u00a714-2-202(b)(4)-(6),206(c)" }, { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1805" }, { "url": "https://sos.ga.gov/how-to-guide/how-guide-register-domestic-entity", "section": "annual registration fee" }, { "url": "https://sos.ga.gov/sites/default/files/forms/Reference%20-%20Filing%20Fees.pdf", "section": "Corporations Division Filing Fees, effective September 6, 2025; Annual Registration (Profit Corp., Professional Corp., Benefit Corp.), both filing methods" }, { "url": "https://dor.georgia.gov/taxes/corporate-income-and-net-worth-tax", "section": "Net Worth Tax" }, { "label": "Governor of Georgia: May 11, 2026 enactment and January 1 effective date", "url": "https://gov.georgia.gov/press-releases/2026-05-11/gov-kemp-signs-legislation-lowering-taxes-and-supporting-economic-growth", "checked": "2026-10-11", "section": "Governor of Georgia: May 11, 2026 enactment and January 1 effective date" }, { "label": "Georgia Department of Economic Development: 2026 corporate rate and apportionment", "url": "https://georgia.org/business-support/incentives", "checked": "2026-10-11", "section": "Georgia Department of Economic Development: 2026 corporate rate and apportionment" }, { "label": "Georgia DOR: corporate net-worth tax and initial filing", "url": "https://dor.georgia.gov/taxes/corporate-income-and-net-worth-tax", "checked": "2026-10-11", "section": "Georgia DOR: corporate net-worth tax and initial filing" } ], "differences": [ "Specified charter mission, rather than compulsory broad general-benefit purpose.", "Optional external standard/public internet posting keeps reporting more flexible, but anyone may request annual report.", "2026 law extends ordinary charter exculpation to officers and permits business-court selection." ], "gaps": [], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "Benefit-law citations use the legislature\u2019s official 2025 Title 14 code supplement. Ordinary charter protection and the nationally listed-company derivative threshold incorporate signed 2026 HB1185, effective July 1, 2026. Annual fees use the agency schedule effective September 6, 2025.", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Georgia offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 14, 14 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Georgia has an identified director monetary-protection provision in the compared scope, which earns this credit. From July 1, 2026, charter may exculpate directors and officers against corporation/shareholder damages. Excludes corporate-opportunity appropriation, intentional misconduct/knowing law violations, unlawful distributions and improper personal benefit. Charter/bylaws may select Georgia State-wide Business Court for lawful internal claims.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 4, 4 ], "reason": "The model assigns 4 points to this designated eligible-officer provision; officer eligibility and excluded claims remain in the legal record.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Georgia extends ordinary protection to officers in a limited eligible-officer scope, so it receives less credit than the broader officer category. From July 1, 2026, charter may exculpate directors and officers against corporation/shareholder damages. Excludes corporate-opportunity appropriation, intentional misconduct/knowing law violations, unlawful distributions and improper personal benefit. Charter/bylaws may select Georgia State-wide Business Court for lawful internal claims.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Georgia requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Georgia has no separately credited benefit-specific monetary shield for company. Unless charter overrides, directors owe no monetary liability to any person for benefit-duty failures or failure to pursue specified benefit. Article 18 contains no corresponding express officer or corporation mission-failure bar.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Georgia earns the benefit-specific credit for directors. Unless charter overrides, directors owe no monetary liability to any person for benefit-duty failures or failure to pursue specified benefit. Article 18 contains no corresponding express officer or corporation mission-failure bar.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Georgia has no separately credited benefit-specific monetary shield for officers. Unless charter overrides, directors owe no monetary liability to any person for benefit-duty failures or failure to pursue specified benefit. Article 18 contains no corresponding express officer or corporation mission-failure bar.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Georgia: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Georgia: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Georgia: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Georgia has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $60 + benefit filing $0 = $60 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Georgia has a compared recurring floor of $60 per year, including $0 in identified minimum tax/license charges. Small active domestic C corporation in a regular year after its initial return, no Georgia taxable profit, and taxable net worth of $100,000 or less. A return remains required; the annual registration fee is additional. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Two-thirds of every class/series, including nonvoting, for entry, substantive benefit alteration/deletion, and covered transactions that transfer ownership/assets outside a substantially similar benefit purpose.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Georgia: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Georgia: changing back requires two-thirds; includes substantive mission modification. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 17, 17 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Georgia requires report access for people outside the company, so it earns public-access credit. At least annual to record shareholders and anyone requesting in writing. General internet publication, more frequent reports, third-party standards/certification can be added voluntarily. No state benefit filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Georgia: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Georgia: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Georgia makes a mission duty mandatory, so it earns this credit. Directors must consider the identified public benefits and adopt performance standards. No explicit Delaware-style balancing rule or mandatory multi-stakeholder list. No independent benefit director required.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 60, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 60, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 77, 77 ], "tax": { "code": "GA", "incomeSummary": "The corporate income-tax rate is 4.99% for tax years beginning in 2026, following HB 463 signed May 11, 2026. The DOR corporate overview and 2025 booklet still display 5.19%, so those older rate statements should not be used as the 2026 rate.", "recurringSummary": "Georgia also imposes a graduated corporate net-worth tax. Net worth of $100,000 or less is not taxed but still requires a return; higher net worth raises tax up to $5,000 above $22 million. New corporations have an initial net-worth return; annual registration and local occupation-tax obligations are separate.", "formationAnnualTaxFloor": null, "floorBasis": "No unconditional dollar floor: the $0 net-worth result depends on the $100,000-or-less net-worth tier. Higher capital can create net-worth tax despite no profit. Excludes annual registration, local occupation taxes, property, sales and payroll taxes.", "scenarioMinimum": 0, "scenarioBasis": "Small active domestic C corporation in a regular year after its initial return, no Georgia taxable profit, and taxable net worth of $100,000 or less. A return remains required; the annual registration fee is additional.", "operatingTaxCaution": "DOR subjects corporations owning property, doing business or receiving Georgia-source income to corporate tax. Georgia's official economic-development guidance confirms single-factor apportionment. Net-worth tax follows its own valuation/apportionment rules, so low receipts alone do not establish $0 net-worth tax.", "sources": [ { "label": "Governor of Georgia: May 11, 2026 enactment and January 1 effective date", "url": "https://gov.georgia.gov/press-releases/2026-05-11/gov-kemp-signs-legislation-lowering-taxes-and-supporting-economic-growth", "checked": "2026-10-11", "section": "Governor of Georgia: May 11, 2026 enactment and January 1 effective date" }, { "label": "Georgia Department of Economic Development: 2026 corporate rate and apportionment", "url": "https://georgia.org/business-support/incentives", "checked": "2026-10-11", "section": "Georgia Department of Economic Development: 2026 corporate rate and apportionment" }, { "label": "Georgia DOR: corporate net-worth tax and initial filing", "url": "https://dor.georgia.gov/taxes/corporate-income-and-net-worth-tax", "checked": "2026-10-11", "section": "Georgia DOR: corporate net-worth tax and initial filing" } ] }, "conversion": { "state": "Georgia", "code": "GA", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Two-thirds of every class/series, including nonvoting, for entry, substantive benefit alteration/deletion, and covered transactions that transfer ownership/assets outside a substantially similar benefit purpose.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.legis.ga.gov/api/document/docs/default-source/joint-features-document-library/t14-(v12)-pdf.pdf", "section": "\u00a714-2-1805" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Charter must state one or more identified public benefits. Article 18 does not require the model-law general-whole-society purpose.", "difference": "Georgia offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "From July 1, 2026, charter may exculpate directors and officers against corporation/shareholder damages. Excludes corporate-opportunity appropriation, intentional misconduct/knowing law violations, unlawful distributions and improper personal benefit. Charter/bylaws may select Georgia State-wide Business Court for lawful internal claims. Benefit-specific rule: Unless charter overrides, directors owe no monetary liability to any person for benefit-duty failures or failure to pursue specified benefit. Article 18 contains no corresponding express officer or corporation mission-failure bar.", "difference": "Georgia adds ordinary officer coverage; the charter must elect the ordinary protection. 2026 law extends ordinary charter exculpation to officers and permits business-court selection." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "At least annual to record shareholders and anyone requesting in writing. General internet publication, more frequent reports, third-party standards/certification can be added voluntarily. No state benefit filing. Assessment rule: Board-selected standards required; external third-party standard and certification optional unless added in charter/bylaws.", "difference": "Georgia: Annual; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $60 per year on an annualized basis. Minimum tax/license used here: $0. Small active domestic C corporation in a regular year after its initial return, no Georgia taxable profit, and taxable net worth of $100,000 or less. A return remains required; the annual registration fee is additional.", "difference": "Georgia has a compared recurring floor of $60 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Two-thirds of every class/series, including nonvoting, for entry, substantive benefit alteration/deletion, and covered transactions that transfer ownership/assets outside a substantially similar benefit purpose. Changing back: two-thirds; includes substantive mission modification", "difference": "Georgia entry uses two-thirds of each class, including nonvoting; exit uses two-thirds; includes substantive mission modification. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider the identified public benefits and adopt performance standards. No explicit Delaware-style balancing rule or mandatory multi-stakeholder list. No independent benefit director required. Disclosure: At least annual to record shareholders and anyone requesting in writing. General internet publication, more frequent reports, third-party standards/certification can be added voluntarily. No state benefit filing. Enforcement: No bespoke benefit-enforcement ownership threshold in Article 18. Ordinary derivative law requires contemporaneous ownership and adequate representation; nationally listed companies may set a threshold up to 1% under 2026 law.", "difference": "Georgia requires public access to the report. Optional external standard/public internet posting keeps reporting more flexible, but anyone may request annual report." } } }, "guideUrl": "/assets/state-guides/GA.md" }, { "state": "Hawaii", "abbreviation": "HI", "form": "Sustainable business corporation", "status": "Available", "reviewed": "2026-10-11", "family": "general benefit with distinct governance and public-comment procedure", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a charter may add specific public benefits.", "sources": [ { "id": "HI-definition", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0002.htm", "section": "\u00a7420D-2", "claims": [ "Minimum two-thirds every-class vote and independence" ] }, { "id": "HI-purpose", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0005.htm", "section": "\u00a7420D-5", "claims": [ "General/specific purpose; patent-purpose permanent status condition" ] } ] }, "board": { "model": "purpose_required_other_stakeholders_discretionary", "summary": "Directors shall consider shareholders and benefit accomplishment; they may consider workers, customers, community, environment and other listed interests. This is not mandatory consideration of every model-act stakeholder.", "sources": [ { "id": "HI-directors", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0006.htm", "section": "\u00a7420D-6", "claims": [ "Mandatory shareholders/benefit; other stakeholders permissive; compliance shield" ] }, { "id": "HI-benefit-director", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0007.htm", "section": "\u00a7420D-7", "claims": [ "Mandatory independent benefit director and response to public comments" ] } ], "mode": "purpose_required_other_stakeholders_discretionary" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Independent, comprehensive and transparent third-party standard is required; the chapter does not require purchase of private certification.", "sources": [ { "id": "HI-standard", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0012.htm", "section": "\u00a7420D-12", "claims": [ "Independent comprehensive transparent standard" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "deadline": "Deliver within 120 days after fiscal year end; allow a 60-day public comment period before final publication.", "redactions": "Director compensation and financial/proprietary information may be omitted in public version.", "summary": "Annual shareholder report and latest public report. A draft must receive 60 days of public comments; benefit director must formally answer all comments/questions in final report.", "sources": [ { "id": "HI-report", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0011.htm", "section": "\u00a7420D-11", "claims": [ "Annual report, 120 days, public publication, 60-day comments" ] } ] }, "enforcement": { "threshold": "Corporation\u2019s shareholders and directors; no benefit-act ownership percentage floor.", "summary": "\u00a7420D-10 permits shareholders/directors to enforce directly or derivatively. Ordinary derivative procedures still matter.", "sources": [ { "id": "HI-enforcement", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0010.htm", "section": "\u00a7420D-10", "claims": [ "Shareholder/director direct or derivative enforcement" ] } ] }, "benefitLiability": { "company": "No express company benefit-failure monetary-damages bar identified in current chapter.", "directors": "Action protected if duties performed in compliance with \u00a7414-221; this is a compliance condition, not an express absolute benefit-failure bar.", "officers": "Actions protected if duties performed in compliance with \u00a7414-233.", "summary": "Do not import another state\u2019s company damages bar into Hawaii. Director/officer protections expressly depend on ordinary standards of conduct.", "sources": [ { "id": "HI-directors", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0006.htm", "section": "\u00a7420D-6", "claims": [ "Mandatory shareholders/benefit; other stakeholders permissive; compliance shield" ] }, { "id": "HI-officers", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0008.htm", "section": "\u00a7420D-8", "claims": [ "Conditional officer consideration and ordinary-duty compliance damages shield" ] }, { "id": "HI-enforcement", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0010.htm", "section": "\u00a7420D-10", "claims": [ "Shareholder/director direct or derivative enforcement" ] } ] }, "ordinaryExculpation": { "scope": "directors", "activation": "Articles provision; later adoption has a special vote under \u00a7414-32(b)(4).", "exceptions": [ "Improper financial benefit", "Intentional harm to corporation/shareholders", "\u00a7414-223 unlawful distributions", "Intentional criminal-law violation" ], "summary": "\u00a7414-222 permits ordinary director articles limitation. Later adoption requires two-thirds shares represented and entitled to vote, also constituting a majority of all shares entitled to vote; written proposal notice and state filing are required.", "sources": [ { "id": "HI-ordinary", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0414/HRS_0414-0222.htm", "section": "\u00a7414-222", "claims": [ "Director articles limitation, four exceptions, adoption vote, written notice and department filing" ] } ] }, "statusChange": { "entryVote": "Two thirds of every class/series, including otherwise nonvoting shares.", "exitVote": "Same minimum status vote, unless the patent-purpose permanent-status clause applies.", "lock": "Special patent-exclusion purpose under \u00a7420D-5(b)(8) makes status permanent and purpose undeletable; benefit director\u2019s finding that purpose is not being pursued can nevertheless end status.", "summary": "Most companies can exit by two-thirds class vote. A particular patent-purpose election creates a conditional permanent mission/status restriction.", "sources": [ { "id": "HI-definition", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0002.htm", "section": "\u00a7420D-2", "claims": [ "Minimum two-thirds every-class vote and independence" ] }, { "id": "HI-purpose", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0005.htm", "section": "\u00a7420D-5", "claims": [ "General/specific purpose; patent-purpose permanent status condition" ] } ] } }, "costs": { "regularReport": { "amount": 12.5, "cadence": "annual", "conditions": "Published online annual domestic stock-corporation report rate; electronic rate used for registry-cost comparison.", "summary": "Published online annual domestic stock-corporation report rate; electronic rate used for registry-cost comparison.", "sources": [ { "id": "HI-fees", "url": "https://www.cca.hawaii.gov/breg/release-second-quarter-hawai%CA%BBi-annual-business-reports-due/", "section": "Official annual-report announcement", "claims": [ "$12.50 online annual business report" ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "Current chapter does not require separate state benefit-report filing.", "summary": "Current chapter does not require separate state benefit-report filing.", "sources": [ { "id": "HI-report", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0011.htm", "section": "\u00a7420D-11", "claims": [ "Annual report, 120 days, public publication, 60-day comments" ] }, { "id": "HI-fees", "url": "https://www.cca.hawaii.gov/breg/release-second-quarter-hawai%CA%BBi-annual-business-reports-due/", "section": "Official annual-report announcement", "claims": [ "$12.50 online annual business report" ] } ] }, "minimumTax": { "amount": 0, "cadence": "annual", "conditions": "No fixed minimum appears in the general Form N-30 corporate-income calculation: tax depends on Hawaii taxable income (4.4%,5.4%,6.4% marginal brackets; capital-gain alternative). Filing generally follows Hawaii-source income, with an additional domestic-corporation outside-income rule. This excludes gross-receipts GET, other taxes and S-corporation/PTE elections.", "summary": "No fixed minimum appears in the general Form N-30 corporate-income calculation: tax depends on Hawaii taxable income (4.4%,5.4%,6.4% marginal brackets; capital-gain alternative). Filing generally follows Hawaii-source income, with an additional domestic-corporation outside-income rule. This excludes gross-receipts GET, other taxes and S-corporation/PTE elections.", "sources": [ { "id": "HI-tax-income", "url": "https://files.hawaii.gov/tax/forms/current/n30ins.pdf", "section": "2025 Form N-30 instructions pp1,5; who must file and ScheduleJ line15", "claims": [ "Corporate-income filing applicability; taxable-income calculation has no fixed general corporate minimum." ] }, { "id": "HI-tax-GET", "url": "https://tax.hawaii.gov/get/", "section": "General Excise Tax business tax overview", "claims": [ "Gross-receipts-based GET is separate from corporate net-income tax." ] }, { "label": "Hawaii DOTAX, 2025 Form N-30 instructions: corporate brackets and capital gains", "url": "https://files.hawaii.gov/tax/forms/current/n30ins.pdf", "checked": "2026-10-11", "section": "Hawaii DOTAX, 2025 Form N-30 instructions: corporate brackets and capital gains" }, { "label": "Hawaii DOTAX, General Excise Tax information: gross receipts, activity rates and nexus", "url": "https://tax.hawaii.gov/get/", "checked": "2026-10-11", "section": "Hawaii DOTAX, General Excise Tax information: gross receipts, activity rates and nexus" }, { "label": "Hawaii DOTAX, licensing information: one-time $20 GET license", "url": "https://tax.hawaii.gov/geninfo/licensing/", "checked": "2026-10-11", "section": "Hawaii DOTAX, licensing information: one-time $20 GET license" } ] } }, "sources": [ { "id": "HI-definition", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0002.htm", "section": "\u00a7420D-2", "claims": [ "Minimum two-thirds every-class vote and independence" ] }, { "id": "HI-purpose", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0005.htm", "section": "\u00a7420D-5", "claims": [ "General/specific purpose; patent-purpose permanent status condition" ] }, { "id": "HI-directors", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0006.htm", "section": "\u00a7420D-6", "claims": [ "Mandatory shareholders/benefit; other stakeholders permissive; compliance shield" ] }, { "id": "HI-benefit-director", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0007.htm", "section": "\u00a7420D-7", "claims": [ "Mandatory independent benefit director and response to public comments" ] }, { "id": "HI-officers", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0008.htm", "section": "\u00a7420D-8", "claims": [ "Conditional officer consideration and ordinary-duty compliance damages shield" ] }, { "id": "HI-enforcement", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0010.htm", "section": "\u00a7420D-10", "claims": [ "Shareholder/director direct or derivative enforcement" ] }, { "id": "HI-report", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0011.htm", "section": "\u00a7420D-11", "claims": [ "Annual report, 120 days, public publication, 60-day comments" ] }, { "id": "HI-standard", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0012.htm", "section": "\u00a7420D-12", "claims": [ "Independent comprehensive transparent standard" ] }, { "id": "HI-ordinary", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0414/HRS_0414-0222.htm", "section": "\u00a7414-222", "claims": [ "Director articles limitation, four exceptions, adoption vote, written notice and department filing" ] }, { "id": "HI-fees", "url": "https://www.cca.hawaii.gov/breg/release-second-quarter-hawai%CA%BBi-annual-business-reports-due/", "section": "Official annual-report announcement", "claims": [ "$12.50 online annual business report" ] }, { "id": "HI-tax-income", "url": "https://files.hawaii.gov/tax/forms/current/n30ins.pdf", "section": "2025 Form N-30 instructions pp1,5; who must file and ScheduleJ line15", "claims": [ "Corporate-income filing applicability; taxable-income calculation has no fixed general corporate minimum." ] }, { "id": "HI-tax-GET", "url": "https://tax.hawaii.gov/get/", "section": "General Excise Tax business tax overview", "claims": [ "Gross-receipts-based GET is separate from corporate net-income tax." ] }, { "label": "Hawaii DOTAX, 2025 Form N-30 instructions: corporate brackets and capital gains", "url": "https://files.hawaii.gov/tax/forms/current/n30ins.pdf", "checked": "2026-10-11", "section": "Hawaii DOTAX, 2025 Form N-30 instructions: corporate brackets and capital gains" }, { "label": "Hawaii DOTAX, General Excise Tax information: gross receipts, activity rates and nexus", "url": "https://tax.hawaii.gov/get/", "checked": "2026-10-11", "section": "Hawaii DOTAX, General Excise Tax information: gross receipts, activity rates and nexus" }, { "label": "Hawaii DOTAX, licensing information: one-time $20 GET license", "url": "https://tax.hawaii.gov/geninfo/licensing/", "checked": "2026-10-11", "section": "Hawaii DOTAX, licensing information: one-time $20 GET license" } ], "differences": [ "Every sustainable business corporation needs an independent benefit director, including a small private company.", "Public commenters receive formal responses in the final annual report; names of 5% holders are disclosed.", "Most stakeholders are permissive considerations while shareholders and benefit purposes are mandatory.", "Conditional permanent patent-purpose rule is relevant to technology/IP businesses." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "Current HRS reviewed. Do not confuse proposed 2019 state-filing amendments with enacted law." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Sustainable business corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Hawaii offers Sustainable business corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 14, 14 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Hawaii has an identified director monetary-protection provision in the compared scope, which earns this credit. \u00a7414-222 permits ordinary director articles limitation. Later adoption requires two-thirds shares represented and entitled to vote, also constituting a majority of all shares entitled to vote; written proposal notice and state filing are required.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Hawaii does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Hawaii requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Hawaii has no separately credited benefit-specific monetary shield for company. Do not import another state\u2019s company damages bar into Hawaii. Director/officer protections expressly depend on ordinary standards of conduct.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Hawaii earns the benefit-specific credit for directors. Do not import another state\u2019s company damages bar into Hawaii. Director/officer protections expressly depend on ordinary standards of conduct.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Hawaii earns the benefit-specific credit for officers. Do not import another state\u2019s company damages bar into Hawaii. Director/officer protections expressly depend on ordinary standards of conduct.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 12, 12 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Hawaii: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Hawaii: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Hawaii: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "Mandatory benefit director or report-approval procedure in this private-company scope: no 3-point flexibility bonus.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Hawaii requires an additional benefit-director or report-approval procedure in this private-company scope, so it receives no no-extra-step credit. Directors shall consider shareholders and benefit accomplishment; they may consider workers, customers, community, environment and other listed interests. This is not mandatory consideration of every model-act stakeholder.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $12.5 + benefit filing $0 = $12.5 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Hawaii has a compared recurring floor of $12.5 per year, including $0 in identified minimum tax/license charges. Fixed yearly baseline only, ordinary domestic C corporation. Variable GET on business receipts can be positive even with zero profit and is excluded from this figure; no annual GET-license renewal charge is included. The $20 registration fee is one-time. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Most companies can exit by two-thirds class vote. A particular patent-purpose election creates a conditional permanent mission/status restriction.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Hawaii: becoming a benefit company requires Two thirds of every class/series, including otherwise nonvoting shares. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Hawaii: changing back requires Same minimum status vote, unless the patent-purpose permanent-status clause applies. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Hawaii requires report access for people outside the company, so it earns public-access credit. Annual shareholder report and latest public report. A draft must receive 60 days of public comments; benefit director must formally answer all comments/questions in final report.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Hawaii: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Hawaii: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Hawaii makes a mission duty mandatory, so it earns this credit. Directors shall consider shareholders and benefit accomplishment; they may consider workers, customers, community, environment and other listed interests. This is not mandatory consideration of every model-act stakeholder.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 12.5, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": true, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 12.5, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 75, 75 ], "tax": { "code": "HI", "incomeSummary": "Corporate income tax has marginal brackets of 4.4% up to $25,000, 5.4% from $25,000 to $100,000 and 6.4% above $100,000; a 4% capital-gain alternative can apply. Separately, GET taxes gross receipts even without profit: the agency currently lists 4.5% for most retail/services, including a 0.5% county surcharge, and 0.5% for qualifying wholesale/production activity.", "recurringSummary": "No fixed annual minimum appears in the general corporate-income computation. GET is variable and may be due on low receipts despite an income-tax loss. The general GET license costs $20 once at registration, not annually.", "formationAnnualTaxFloor": 0, "floorBasis": "No fixed annual amount in ordinary corporate-income/GET calculations. Excludes registry fees, variable GET and the one-time $20 GET license; not a zero-tax statement.", "scenarioMinimum": 0, "scenarioBasis": "Fixed yearly baseline only, ordinary domestic C corporation. Variable GET on business receipts can be positive even with zero profit and is excluded from this figure; no annual GET-license renewal charge is included. The $20 registration fee is one-time.", "operatingTaxCaution": "Hawaii-source income, physical/economic nexus, allocation/apportionment and GET sourcing matter. Formation elsewhere does not remove taxes on Hawaii activities; the GET rate depends on activity and applicable county surcharge.", "sources": [ { "label": "Hawaii DOTAX, 2025 Form N-30 instructions: corporate brackets and capital gains", "url": "https://files.hawaii.gov/tax/forms/current/n30ins.pdf", "checked": "2026-10-11", "section": "Hawaii DOTAX, 2025 Form N-30 instructions: corporate brackets and capital gains" }, { "label": "Hawaii DOTAX, General Excise Tax information: gross receipts, activity rates and nexus", "url": "https://tax.hawaii.gov/get/", "checked": "2026-10-11", "section": "Hawaii DOTAX, General Excise Tax information: gross receipts, activity rates and nexus" }, { "label": "Hawaii DOTAX, licensing information: one-time $20 GET license", "url": "https://tax.hawaii.gov/geninfo/licensing/", "checked": "2026-10-11", "section": "Hawaii DOTAX, licensing information: one-time $20 GET license" } ] }, "conversion": { "state": "Hawaii", "code": "HI", "form": "Sustainable business corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "Two thirds of every class/series, including otherwise nonvoting shares.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Most companies can exit by two-thirds class vote. A particular patent-purpose election creates a conditional permanent mission/status restriction.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "id": "HI-definition", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0002.htm", "section": "\u00a7420D-2", "claims": [ "Minimum two-thirds every-class vote and independence" ] }, { "id": "HI-purpose", "url": "https://data.capitol.hawaii.gov/hrscurrent/Vol08_Ch0401-0429/HRS0420D/HRS_0420D-0005.htm", "section": "\u00a7420D-5", "claims": [ "General/specific purpose; patent-purpose permanent status condition" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a charter may add specific public benefits.", "difference": "Hawaii offers Sustainable business corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "\u00a7414-222 permits ordinary director articles limitation. Later adoption requires two-thirds shares represented and entitled to vote, also constituting a majority of all shares entitled to vote; written proposal notice and state filing are required. Benefit-specific rule: Do not import another state\u2019s company damages bar into Hawaii. Director/officer protections expressly depend on ordinary standards of conduct.", "difference": "Hawaii keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Every sustainable business corporation needs an independent benefit director, including a small private company." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder report and latest public report. A draft must receive 60 days of public comments; benefit director must formally answer all comments/questions in final report. Assessment rule: Independent, comprehensive and transparent third-party standard is required; the chapter does not require purchase of private certification.", "difference": "Hawaii: Annual; Required outside framework; no separate state benefit-report filing. An additional benefit-director or approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $12.5 per year on an annualized basis. Minimum tax/license used here: $0. Fixed yearly baseline only, ordinary domestic C corporation. Variable GET on business receipts can be positive even with zero profit and is excluded from this figure; no annual GET-license renewal charge is included. The $20 registration fee is one-time.", "difference": "Hawaii has a compared recurring floor of $12.5 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Two thirds of every class/series, including otherwise nonvoting shares. Most companies can exit by two-thirds class vote. A particular patent-purpose election creates a conditional permanent mission/status restriction. Changing back: Same minimum status vote, unless the patent-purpose permanent-status clause applies.", "difference": "Hawaii entry uses Two thirds of every class/series, including otherwise nonvoting shares.; exit uses Same minimum status vote, unless the patent-purpose permanent-status clause applies.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors shall consider shareholders and benefit accomplishment; they may consider workers, customers, community, environment and other listed interests. This is not mandatory consideration of every model-act stakeholder. Disclosure: Annual shareholder report and latest public report. A draft must receive 60 days of public comments; benefit director must formally answer all comments/questions in final report. Enforcement: \u00a7420D-10 permits shareholders/directors to enforce directly or derivatively. Ordinary derivative procedures still matter.", "difference": "Hawaii requires public access to the report. Public commenters receive formal responses in the final annual report; names of 5% holders are disclosed. Most stakeholders are permissive considerations while shareholders and benefit purposes are mandatory." } } }, "guideUrl": "/assets/state-guides/HI.md" }, { "state": "Idaho", "abbreviation": "ID", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "general-benefit model with class-based enforcement", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a charter may add specific public benefits.", "sources": [ { "id": "ID-purpose", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2006/", "section": "\u00a730-2006", "claims": [ "General/specific purpose" ] } ] }, "board": { "model": "mandatory_stakeholder_consideration", "summary": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "sources": [ { "id": "ID-directors", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2007/", "section": "\u00a730-2007", "claims": [ "Mandatory consideration and conditional damages shields" ] } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "sources": [ { "id": "ID-assessment", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2012/", "section": "\u00a730-2012", "claims": [ "Annual third-party-standard assessment, no certification/audit requirement" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "deadline": "Earlier of 120 days after fiscal year end or another annual shareholder report.", "redactions": "Director compensation and financial/proprietary information may be omitted publicly.", "summary": "Annual shareholder report; all benefit reports publicly available online or free on request. No separate state benefit-report filing in \u00a7\u00a730-2012\u20132013.", "sources": [ { "id": "ID-report", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2013/", "section": "\u00a730-2013", "claims": [ "Shareholder/public annual report" ] } ] }, "enforcement": { "threshold": "2% of a class or series at the act/omission; director; 5% parent equity owner; authorized others.", "summary": "A small class holding can qualify even when below 2% of all shares. Corporation also has direct standing.", "sources": [ { "id": "ID-enforcement", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2011/", "section": "\u00a730-2011", "claims": [ "Class/series 2% threshold and corporation benefit-failure shield" ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to create benefit.", "directors": "Default protection for compliant benefit duties and failure to create benefit, subject to articles; ordinary duty compliance required.", "officers": "Conditional stakeholder consideration and compliant conduct/benefit-failure shield.", "summary": "Independent benefit director required for publicly traded corporations only; benefit director\u2019s special immunity excludes self-dealing, willful misconduct and knowing law violations.", "sources": [ { "id": "ID-directors", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2007/", "section": "\u00a730-2007", "claims": [ "Mandatory consideration and conditional damages shields" ] }, { "id": "ID-officer", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2009/", "section": "\u00a730-2009", "claims": [ "Officer duty/protection" ] }, { "id": "ID-enforcement", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2011/", "section": "\u00a730-2011", "claims": [ "Class/series 2% threshold and corporation benefit-failure shield" ] } ] }, "ordinaryExculpation": { "scope": "directors", "activation": "Opt-in articles.", "exceptions": [ "Improper financial benefit", "Intentional infliction of harm", "Specified unlawful distributions", "Intentional criminal-law violation", "Acts before the provision becomes effective" ], "summary": "Director charter exculpation under \u00a730-29-202(2)(d), with improper benefit, intentional harm, unlawful distributions and intentional criminal-law exceptions.", "sources": [ { "id": "ID-ordinary", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH29/SECT30-29-202/", "section": "\u00a730-29-202(2)(d)", "claims": [ "Director charter exculpation and exceptions" ] } ] }, "statusChange": { "entryVote": "Two thirds of every class/series, including otherwise nonvoting shares.", "exitVote": "Same minimum status vote.", "lock": "No unconditional permanent lock identified.", "summary": "Two-thirds each-class status approval; specific-purpose changes also require minimum status vote.", "sources": [ { "id": "ID-votes", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2002/", "section": "\u00a730-2002; \u00a7\u00a730-2004\u20132005", "claims": [ "Two-thirds every-class minimum status vote" ] } ] } }, "costs": { "regularReport": { "amount": 0, "cadence": "annual", "conditions": "Online annual report is free. Paper manual-processing fees are excluded.", "summary": "Online annual report is free. Paper manual-processing fees are excluded.", "sources": [ { "id": "ID-fee", "url": "https://sos.idaho.gov/PressRelease/2023/20230413_Business_Solicitations.pdf", "section": "Official Secretary of State solicitation warning", "claims": [ "Annual reports free through official online service" ] }, { "id": "ID-paper", "url": "https://sos.idaho.gov/business-forms/", "section": "Current business forms", "claims": [ "Manual paper processing is separate" ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate state benefit-report filing requirement identified.", "summary": "No separate state benefit-report filing requirement identified.", "sources": [ { "id": "ID-report", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2013/", "section": "\u00a730-2013", "claims": [ "Shareholder/public annual report" ] } ] }, "minimumTax": { "amount": 20, "cadence": "annual", "conditions": "General corporation minimum income/franchise tax is $20 for businesses transacting business, registered to do business, or exercising the corporate franchise in Idaho, including ordinary inactive/nameholder corporations. Certain exceptions, including protected PL86-272 corporations, apply. A separate $10 permanent building fund tax generally applies to every corporation required to file.", "summary": "General corporation minimum income/franchise tax is $20 for businesses transacting business, registered to do business, or exercising the corporate franchise in Idaho, including ordinary inactive/nameholder corporations. Certain exceptions, including protected PL86-272 corporations, apply. A separate $10 permanent building fund tax generally applies to every corporation required to file.", "sources": [ { "id": "ID-tax-minimum", "url": "https://tax.idaho.gov/document-mngr/forms_EFO00025/", "section": "2025 Form 41 instructions, income-tax line38 and PBF line44; pp5\u20136 of instructions", "claims": [ "$20 general income/franchise minimum and exceptions; separate $10 building-fund tax, including ordinary inactive/nameholder corporations." ] }, { "id": "ID-tax-applicability", "url": "https://tax.idaho.gov/taxes/income-tax/business-income/guides-for-certain-businesses/income-tax-for-corporations/", "section": "Definition, exemptions and franchise tax", "claims": [ "Doing business, registered status or Idaho income triggers corporation filing; PL86-272 exception; corporate income and franchise taxes are alternatives." ] }, { "label": "Idaho Legislature, current Code 63-3025: 5.3% from 2025 onward and $20 minimum", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title63/T63CH30/SECT63-3025/", "checked": "2026-10-11", "section": "Idaho Legislature, current Code 63-3025: 5.3% from 2025 onward and $20 minimum" }, { "label": "Idaho Tax Commission, 2025 Form 41 and instructions: $20 minimum, $10 PBF, credits and exceptions", "url": "https://tax.idaho.gov/document-mngr/forms_EFO00025/", "checked": "2026-10-11", "section": "Idaho Tax Commission, 2025 Form 41 and instructions: $20 minimum, $10 PBF, credits and exceptions" }, { "label": "Idaho Tax Commission, business income basics: 5.3% and PBF", "url": "https://tax.idaho.gov/taxes/income-tax/business-income/online-guide/", "checked": "2026-10-11", "section": "Idaho Tax Commission, business income basics: 5.3% and PBF" }, { "label": "Idaho Tax Commission, corporations: registration, inactivity, nexus and alternative income/franchise taxation", "url": "https://tax.idaho.gov/taxes/income-tax/business-income/guides-for-certain-businesses/income-tax-for-corporations/", "checked": "2026-10-11", "section": "Idaho Tax Commission, corporations: registration, inactivity, nexus and alternative income/franchise taxation" } ] } }, "sources": [ { "id": "ID-purpose", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2006/", "section": "\u00a730-2006", "claims": [ "General/specific purpose" ] }, { "id": "ID-votes", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2002/", "section": "\u00a730-2002; \u00a7\u00a730-2004\u20132005", "claims": [ "Two-thirds every-class minimum status vote" ] }, { "id": "ID-directors", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2007/", "section": "\u00a730-2007", "claims": [ "Mandatory consideration and conditional damages shields" ] }, { "id": "ID-benefit-director", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2008/", "section": "\u00a730-2008", "claims": [ "Publicly traded independent benefit director and misconduct exceptions" ] }, { "id": "ID-officer", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2009/", "section": "\u00a730-2009", "claims": [ "Officer duty/protection" ] }, { "id": "ID-enforcement", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2011/", "section": "\u00a730-2011", "claims": [ "Class/series 2% threshold and corporation benefit-failure shield" ] }, { "id": "ID-assessment", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2012/", "section": "\u00a730-2012", "claims": [ "Annual third-party-standard assessment, no certification/audit requirement" ] }, { "id": "ID-report", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2013/", "section": "\u00a730-2013", "claims": [ "Shareholder/public annual report" ] }, { "id": "ID-ordinary", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH29/SECT30-29-202/", "section": "\u00a730-29-202(2)(d)", "claims": [ "Director charter exculpation and exceptions" ] }, { "id": "ID-fee", "url": "https://sos.idaho.gov/PressRelease/2023/20230413_Business_Solicitations.pdf", "section": "Official Secretary of State solicitation warning", "claims": [ "Annual reports free through official online service" ] }, { "id": "ID-paper", "url": "https://sos.idaho.gov/business-forms/", "section": "Current business forms", "claims": [ "Manual paper processing is separate" ] }, { "id": "ID-tax-minimum", "url": "https://tax.idaho.gov/document-mngr/forms_EFO00025/", "section": "2025 Form 41 instructions, income-tax line38 and PBF line44; pp5\u20136 of instructions", "claims": [ "$20 general income/franchise minimum and exceptions; separate $10 building-fund tax, including ordinary inactive/nameholder corporations." ] }, { "id": "ID-tax-applicability", "url": "https://tax.idaho.gov/taxes/income-tax/business-income/guides-for-certain-businesses/income-tax-for-corporations/", "section": "Definition, exemptions and franchise tax", "claims": [ "Doing business, registered status or Idaho income triggers corporation filing; PL86-272 exception; corporate income and franchise taxes are alternatives." ] }, { "label": "Idaho Legislature, current Code 63-3025: 5.3% from 2025 onward and $20 minimum", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title63/T63CH30/SECT63-3025/", "checked": "2026-10-11", "section": "Idaho Legislature, current Code 63-3025: 5.3% from 2025 onward and $20 minimum" }, { "label": "Idaho Tax Commission, 2025 Form 41 and instructions: $20 minimum, $10 PBF, credits and exceptions", "url": "https://tax.idaho.gov/document-mngr/forms_EFO00025/", "checked": "2026-10-11", "section": "Idaho Tax Commission, 2025 Form 41 and instructions: $20 minimum, $10 PBF, credits and exceptions" }, { "label": "Idaho Tax Commission, business income basics: 5.3% and PBF", "url": "https://tax.idaho.gov/taxes/income-tax/business-income/online-guide/", "checked": "2026-10-11", "section": "Idaho Tax Commission, business income basics: 5.3% and PBF" }, { "label": "Idaho Tax Commission, corporations: registration, inactivity, nexus and alternative income/franchise taxation", "url": "https://tax.idaho.gov/taxes/income-tax/business-income/guides-for-certain-businesses/income-tax-for-corporations/", "checked": "2026-10-11", "section": "Idaho Tax Commission, corporations: registration, inactivity, nexus and alternative income/franchise taxation" } ], "differences": [ "Derivative threshold is 2% of a class/series, unlike Arizona\u2019s 2% total ownership.", "Independent benefit director is mandatory only for public companies, optional for private companies.", "Online registry renewal is free; the company must still prepare/publicize annual benefit assessment." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "Current official Idaho code reviewed; ordinary corporation code is Chapter 29, not old Chapter 1." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Idaho offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Idaho has an identified director monetary-protection provision in the compared scope, which earns this credit. Director charter exculpation under \u00a730-29-202(2)(d), with improper benefit, intentional harm, unlawful distributions and intentional criminal-law exceptions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Idaho does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Idaho requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Idaho earns the benefit-specific credit for company. Independent benefit director required for publicly traded corporations only; benefit director\u2019s special immunity excludes self-dealing, willful misconduct and knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Idaho earns the benefit-specific credit for directors. Independent benefit director required for publicly traded corporations only; benefit director\u2019s special immunity excludes self-dealing, willful misconduct and knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Idaho earns the benefit-specific credit for officers. Independent benefit director required for publicly traded corporations only; benefit director\u2019s special immunity excludes self-dealing, willful misconduct and knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Idaho: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Idaho: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Idaho: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Idaho has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $0 = $0 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Idaho has a compared recurring floor of $30 per year, including $30 in identified minimum tax/license charges. Ordinary domestic C corporation operating in Idaho, no taxable profit, no credit or special exemption. Includes both $20 corporate minimum and $10 PBF; excludes registry and variable operating taxes. Do not add another $10 if PBF has already been counted separately. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Two-thirds each-class status approval; specific-purpose changes also require minimum status vote.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Idaho: becoming a benefit company requires Two thirds of every class/series, including otherwise nonvoting shares. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Idaho: changing back requires Same minimum status vote. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Idaho requires report access for people outside the company, so it earns public-access credit. Annual shareholder report; all benefit reports publicly available online or free on request. No separate state benefit-report filing in \u00a7\u00a730-2012\u20132013.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Idaho: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Idaho: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Idaho makes a mission duty mandatory, so it earns this credit. Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 0, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 30, "minimumTaxAnnualized": 30, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 79, 79 ], "tax": { "code": "ID", "incomeSummary": "The general corporate income/franchise rate is 5.3% for tax years beginning January 1, 2025 or later. Ordinary corporations generally owe at least $20 before credits, plus a separate $10 permanent building fund tax; corporate income and franchise taxes are alternatives, not cumulative.", "recurringSummary": "$20 corporate minimum plus $10 PBF gives a $30 ordinary no-credit annual baseline. Registered inactive/nameholder corporations are generally included. Specified exceptions, including Public Law 86-272 protection, and allowed credits can affect liability.", "formationAnnualTaxFloor": 30, "floorBasis": "Ordinary registered domestic C corporation required to file, no statutory exception or tax credit assumed: $20 minimum + $10 PBF. Registry fees and variable tax above the minimum are excluded.", "scenarioMinimum": 30, "scenarioBasis": "Ordinary domestic C corporation operating in Idaho, no taxable profit, no credit or special exemption. Includes both $20 corporate minimum and $10 PBF; excludes registry and variable operating taxes. Do not add another $10 if PBF has already been counted separately.", "operatingTaxCaution": "Doing business, registration or Idaho-source income can trigger filing. Multistate income is allocated/apportioned; narrow federal protections and special sales-only elections require their own analysis.", "sources": [ { "label": "Idaho Legislature, current Code 63-3025: 5.3% from 2025 onward and $20 minimum", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title63/T63CH30/SECT63-3025/", "checked": "2026-10-11", "section": "Idaho Legislature, current Code 63-3025: 5.3% from 2025 onward and $20 minimum" }, { "label": "Idaho Tax Commission, 2025 Form 41 and instructions: $20 minimum, $10 PBF, credits and exceptions", "url": "https://tax.idaho.gov/document-mngr/forms_EFO00025/", "checked": "2026-10-11", "section": "Idaho Tax Commission, 2025 Form 41 and instructions: $20 minimum, $10 PBF, credits and exceptions" }, { "label": "Idaho Tax Commission, business income basics: 5.3% and PBF", "url": "https://tax.idaho.gov/taxes/income-tax/business-income/online-guide/", "checked": "2026-10-11", "section": "Idaho Tax Commission, business income basics: 5.3% and PBF" }, { "label": "Idaho Tax Commission, corporations: registration, inactivity, nexus and alternative income/franchise taxation", "url": "https://tax.idaho.gov/taxes/income-tax/business-income/guides-for-certain-businesses/income-tax-for-corporations/", "checked": "2026-10-11", "section": "Idaho Tax Commission, corporations: registration, inactivity, nexus and alternative income/franchise taxation" } ] }, "conversion": { "state": "Idaho", "code": "ID", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "Two thirds of every class/series, including otherwise nonvoting shares.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Two-thirds each-class status approval; specific-purpose changes also require minimum status vote.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "id": "ID-votes", "url": "https://legislature.idaho.gov/statutesrules/idstat/Title30/T30CH20/SECT30-2002/", "section": "\u00a730-2002; \u00a7\u00a730-2004\u20132005", "claims": [ "Two-thirds every-class minimum status vote" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a charter may add specific public benefits.", "difference": "Idaho offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director charter exculpation under \u00a730-29-202(2)(d), with improper benefit, intentional harm, unlawful distributions and intentional criminal-law exceptions. Benefit-specific rule: Independent benefit director required for publicly traded corporations only; benefit director\u2019s special immunity excludes self-dealing, willful misconduct and knowing law violations.", "difference": "Idaho keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Independent benefit director is mandatory only for public companies, optional for private companies." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder report; all benefit reports publicly available online or free on request. No separate state benefit-report filing in \u00a7\u00a730-2012\u20132013. Assessment rule: Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "difference": "Idaho: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $0 per year on an annualized basis. Minimum tax/license used here: $30. Ordinary domestic C corporation operating in Idaho, no taxable profit, no credit or special exemption. Includes both $20 corporate minimum and $10 PBF; excludes registry and variable operating taxes. Do not add another $10 if PBF has already been counted separately.", "difference": "Idaho has a compared recurring floor of $30 per year, including $30 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Two thirds of every class/series, including otherwise nonvoting shares. Two-thirds each-class status approval; specific-purpose changes also require minimum status vote. Changing back: Same minimum status vote.", "difference": "Idaho entry uses Two thirds of every class/series, including otherwise nonvoting shares.; exit uses Same minimum status vote.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities. Disclosure: Annual shareholder report; all benefit reports publicly available online or free on request. No separate state benefit-report filing in \u00a7\u00a730-2012\u20132013. Enforcement: A small class holding can qualify even when below 2% of all shares. Corporation also has direct standing.", "difference": "Idaho requires public access to the report. Derivative threshold is 2% of a class/series, unlike Arizona\u2019s 2% total ownership. Independent benefit director is mandatory only for public companies, optional for private companies. Online registry renewal is free; the company must still prepare/publicize annual benefit assessment." } } }, "guideUrl": "/assets/state-guides/ID.md" }, { "state": "Illinois", "abbreviation": "IL", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit mandatory stakeholder model; mandatory benefit director", "features": { "purpose": { "sources": [ { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K3.01.htm", "section": "805 ILCS 40/3.01" } ], "confidence": "high", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; specific benefits are optional." }, "board": { "sources": [ { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.01.htm", "section": "805 ILCS 40/4.01" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.05.htm", "section": "805 ILCS 40/4.05" } ], "confidence": "high", "mode": "mandatory_stakeholder_consideration", "summary": "Mandatory consideration of listed stakeholders; no required priority unless charter specifies one. All benefit corporations must designate an independent benefit director, with special rules when shareholders/others perform board duties." }, "standard": { "sources": [ { "url": "https://www.ilga.gov/legislation/ILCS/details?ActID=3419&ActName=Benefit+Corporation+Act.&ChapAct=805+ILCS+40%2F&Chapter=BUSINESS+ORGANIZATIONS&ChapterID=65&MajorTopic=BUSINESS+AND+EMPLOYMENT&SeqEnd=&SeqStart=1700000", "section": "805 ILCS 40/5.01(a)(2)" }, { "url": "https://www.ilga.gov/legislation/ILCS/details?ActID=3419&ActName=Benefit+Corporation+Act.&ChapAct=805+ILCS+40%2F&Chapter=BUSINESS+ORGANIZATIONS&ChapterID=65&MajorTopic=BUSINESS+AND+EMPLOYMENT&SeqEnd=&SeqStart=1700000", "section": "805 ILCS 40/5.01" } ], "confidence": "high", "required": true, "summary": "Annual performance assessment must use a third-party standard. Statute requires assessment against a standard but does not require buying certification or external audit in its reporting provision.", "thirdPartyRequired": true, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://www.ilga.gov/legislation/ILCS/details?ActID=3419&ActName=Benefit+Corporation+Act.&ChapAct=805+ILCS+40%2F&Chapter=BUSINESS+ORGANIZATIONS&ChapterID=65&MajorTopic=BUSINESS+AND+EMPLOYMENT&SeqEnd=&SeqStart=1700000", "section": "805 ILCS 40/5.01" } ], "confidence": "high", "required": false, "summary": "Statute requires assessment against a standard but does not require buying certification or external audit in its reporting provision." }, "report": { "sources": [ { "url": "https://www.ilga.gov/legislation/ILCS/details?ActID=3419&ActName=Benefit+Corporation+Act.&ChapAct=805+ILCS+40%2F&Chapter=BUSINESS+ORGANIZATIONS&ChapterID=65&MajorTopic=BUSINESS+AND+EMPLOYMENT&SeqEnd=&SeqStart=1700000", "section": "805 ILCS 40/5.01" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "summary": "Annual shareholder report within 120 days or with other annual report; all reports public website, latest free copy if no website. Report identifies known/record owners of at least 5% and benefit-director opinion. No state benefit-report filing required by this section." }, "enforcement": { "sources": [ { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.20.htm", "section": "805 ILCS 40/4.20" } ], "confidence": "high", "threshold": "any_shareholder", "summary": "Corporation directly; derivatively any shareholder, director, 5% parent-equity holders, and charter/bylaw designees. No 2% floor on company shareholder." }, "benefitLiability": { "sources": [ { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.01.htm", "section": "805 ILCS 40/4.01" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.05.htm", "section": "805 ILCS 40/4.05" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.10.htm", "section": "805 ILCS 40/4.10" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.20.htm", "section": "805 ILCS 40/4.20" } ], "confidence": "high", "company": true, "directors": true, "officers": true, "summary": "Company monetary damages barred under benefit Act for failure to pursue/create benefit. Director and officer protection for compliant conduct and benefit failure; benefit-director exceptions include self-dealing, willful misconduct or knowing law violation." }, "ordinaryExculpation": { "sources": [ { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500050K2.10.htm", "section": "805 ILCS 5/2.10(b)(3)" } ], "confidence": "high", "director": true, "officer": false, "optIn": true, "summary": "Optional director-only charter monetary exculpation for corporation/shareholder fiduciary claims; exceptions loyalty, bad faith, intentional misconduct/knowing law violation, unlawful distributions, improper personal benefit and pre-effective conduct.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K1.10.htm", "section": "805 ILCS 40/1.10" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K2.05.htm", "section": "805 ILCS 40/2.05" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K2.10.htm", "section": "805 ILCS 40/2.10" } ], "confidence": "high", "entry": "2/3 each class/series", "exit": "2/3 each class/series", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "Minimum-status vote: 2/3 each class/series including otherwise nonvoting shares; applies to entry, exit and nonordinary all/substantially-all asset disposition.", "exitVote": "2/3 each class/series", "entryVote": "2/3 each class/series" } }, "costs": { "regularReport": { "sources": [ { "url": "https://www.ilsos.gov/content/dam/publications/pdf_publications/bca1405d.pdf", "section": "BCA 14.05 D, revised February 2026" } ], "confidence": "high", "amount": 75, "cadence": "annual", "online": 75, "paper": 75, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Ordinary domestic corporation annual report filing fee is $75; franchise tax is separate.", "conditions": "Ordinary domestic corporation annual report filing fee is $75; franchise tax is separate." }, "benefitReport": { "sources": [ { "url": "https://www.ilga.gov/legislation/ILCS/details?ActID=3419&ActName=Benefit+Corporation+Act.&ChapAct=805+ILCS+40%2F&Chapter=BUSINESS+ORGANIZATIONS&ChapterID=65&MajorTopic=BUSINESS+AND+EMPLOYMENT&SeqEnd=&SeqStart=1700000", "section": "805 ILCS 40/5.01" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://www.ilga.gov/ftp/ILCS/Ch%200805/Act%200005/080500050K15.35.html", "section": "805 ILCS 5/15.35" }, { "url": "https://tax.illinois.gov/questionsandanswers/answer.83.html", "section": "Illinois Department of Revenue: business income and replacement tax rates" }, { "label": "Illinois Revenue: C-corporation income and replacement tax rates", "url": "https://tax.illinois.gov/questionsandanswers/answer.83.html", "checked": "2026-10-11", "section": "Illinois Revenue: C-corporation income and replacement tax rates" }, { "label": "Illinois Secretary of State: domestic annual report franchise calculation and 2025-forward exemption", "url": "https://www.ilsos.gov/content/dam/publications/pdf_publications/c289.pdf", "checked": "2026-10-11", "section": "Illinois Secretary of State: domestic annual report franchise calculation and 2025-forward exemption" }, { "label": "Illinois Revenue: corporate base-income and filing requirements", "url": "https://tax.illinois.gov/research/taxinformation/income/corporate.html", "checked": "2026-10-11", "section": "Illinois Revenue: corporate base-income and filing requirements" } ], "confidence": "high", "amount": 0, "cadence": "annual", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Franchise-tax liability first $10,000 is exempt on/after January 1, 2025. Thus zero franchise tax for liability below exemption; higher paid-in-capital cases may owe more. Separate Illinois C-corporation income tax is 7% and replacement tax 2.5% of net income; the capital-based franchise exemption is not an income-tax exemption.", "conditions": "Franchise-tax liability first $10,000 is exempt on/after January 1, 2025. Thus zero franchise tax for liability below exemption; higher paid-in-capital cases may owe more. Separate Illinois C-corporation income tax is 7% and replacement tax 2.5% of net income; the capital-based franchise exemption is not an income-tax exemption." } }, "sources": [ { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K3.01.htm", "section": "805 ILCS 40/3.01" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.01.htm", "section": "805 ILCS 40/4.01" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.05.htm", "section": "805 ILCS 40/4.05" }, { "url": "https://www.ilga.gov/legislation/ILCS/details?ActID=3419&ActName=Benefit+Corporation+Act.&ChapAct=805+ILCS+40%2F&Chapter=BUSINESS+ORGANIZATIONS&ChapterID=65&MajorTopic=BUSINESS+AND+EMPLOYMENT&SeqEnd=&SeqStart=1700000", "section": "805 ILCS 40/5.01(a)(2)" }, { "url": "https://www.ilga.gov/legislation/ILCS/details?ActID=3419&ActName=Benefit+Corporation+Act.&ChapAct=805+ILCS+40%2F&Chapter=BUSINESS+ORGANIZATIONS&ChapterID=65&MajorTopic=BUSINESS+AND+EMPLOYMENT&SeqEnd=&SeqStart=1700000", "section": "805 ILCS 40/5.01" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.20.htm", "section": "805 ILCS 40/4.20" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K4.10.htm", "section": "805 ILCS 40/4.10" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500050K2.10.htm", "section": "805 ILCS 5/2.10(b)(3)" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K1.10.htm", "section": "805 ILCS 40/1.10" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K2.05.htm", "section": "805 ILCS 40/2.05" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K2.10.htm", "section": "805 ILCS 40/2.10" }, { "url": "https://www.ilsos.gov/content/dam/publications/pdf_publications/bca1405d.pdf", "section": "BCA 14.05 D, revised February 2026" }, { "url": "https://www.ilga.gov/ftp/ILCS/Ch%200805/Act%200005/080500050K15.35.html", "section": "805 ILCS 5/15.35" }, { "url": "https://tax.illinois.gov/questionsandanswers/answer.83.html", "section": "Illinois Department of Revenue: business income and replacement tax rates" }, { "label": "Illinois Revenue: C-corporation income and replacement tax rates", "url": "https://tax.illinois.gov/questionsandanswers/answer.83.html", "checked": "2026-10-11", "section": "Illinois Revenue: C-corporation income and replacement tax rates" }, { "label": "Illinois Secretary of State: domestic annual report franchise calculation and 2025-forward exemption", "url": "https://www.ilsos.gov/content/dam/publications/pdf_publications/c289.pdf", "checked": "2026-10-11", "section": "Illinois Secretary of State: domestic annual report franchise calculation and 2025-forward exemption" }, { "label": "Illinois Revenue: corporate base-income and filing requirements", "url": "https://tax.illinois.gov/research/taxinformation/income/corporate.html", "checked": "2026-10-11", "section": "Illinois Revenue: corporate base-income and filing requirements" } ], "differences": [ "All corporations require a benefit director, unlike optional/private-exempt models.", "Public report discloses known/record 5% owners.", "Any shareholder can enforce; no percentage floor." ], "gaps": [ "Franchise-tax amount above exemption requires entity-specific capital/allocation calculation." ], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "Official statute text was read through current indexed official pages when some direct requests produced certificate/access errors.", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Illinois offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Illinois has an identified director monetary-protection provision in the compared scope, which earns this credit. Optional director-only charter monetary exculpation for corporation/shareholder fiduciary claims; exceptions loyalty, bad faith, intentional misconduct/knowing law violation, unlawful distributions, improper personal benefit and pre-effective conduct.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Illinois does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Illinois requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Illinois earns the benefit-specific credit for company. Company monetary damages barred under benefit Act for failure to pursue/create benefit. Director and officer protection for compliant conduct and benefit failure; benefit-director exceptions include self-dealing, willful misconduct or knowing law violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Illinois earns the benefit-specific credit for directors. Company monetary damages barred under benefit Act for failure to pursue/create benefit. Director and officer protection for compliant conduct and benefit failure; benefit-director exceptions include self-dealing, willful misconduct or knowing law violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Illinois earns the benefit-specific credit for officers. Company monetary damages barred under benefit Act for failure to pursue/create benefit. Director and officer protection for compliant conduct and benefit failure; benefit-director exceptions include self-dealing, willful misconduct or knowing law violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 12, 12 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Illinois: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Illinois: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Illinois: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "Mandatory benefit director or report-approval procedure in this private-company scope: no 3-point flexibility bonus.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Illinois requires an additional benefit-director or report-approval procedure in this private-company scope, so it receives no no-extra-step credit. Mandatory consideration of listed stakeholders; no required priority unless charter specifies one. All benefit corporations must designate an independent benefit director, with special rules when shareholders/others perform board duties.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $75 + benefit filing $0 = $75 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Illinois has a compared recurring floor of $75 per year, including $0 in identified minimum tax/license charges. Small active domestic C corporation with no Illinois net taxable income and allocated paid-in capital at or below $10 million: annual franchise liability is within the $10,000 exemption and income/replacement tax is $0. Excludes report fees and capital-change transactions. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Minimum-status vote: 2/3 each class/series including otherwise nonvoting shares; applies to entry, exit and nonordinary all/substantially-all asset disposition.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Illinois: becoming a benefit company requires 2/3 each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Illinois: changing back requires 2/3 each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Illinois requires report access for people outside the company, so it earns public-access credit. Annual shareholder report within 120 days or with other annual report; all reports public website, latest free copy if no website. Report identifies known/record owners of at least 5% and benefit-director opinion. No state benefit-report filing required by this section.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Illinois: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Illinois: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Illinois makes a mission duty mandatory, so it earns this credit. Mandatory consideration of listed stakeholders; no required priority unless charter specifies one. All benefit corporations must designate an independent benefit director, with special rules when shareholders/others perform board duties.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 75, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": true, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 75, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 74, 74 ], "tax": { "code": "IL", "incomeSummary": "An ordinary C corporation pays 7% Illinois income tax plus 2.5% personal property replacement tax on Illinois net income, a combined nominal 9.5%. Both are income-based; the capital-based franchise exemption does not exempt corporate income.", "recurringSummary": "Annual franchise tax is generally 0.1% of Illinois-allocated paid-in capital, with a $25 calculated minimum before the exemption. The first $10,000 of franchise-tax liability is exempt for filing periods January 1, 2025 and later, so a small corporation can owe $0 franchise tax. Paid-in-capital changes can trigger separate additional franchise calculations. The $75 annual report fee is separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive annual franchise-tax floor survives the $10,000 liability exemption for a small domestic stock corporation; actual tax depends on paid-in capital and allocation. This excludes the annual report fee, initial formation charges, and income/replacement tax.", "scenarioMinimum": 0, "scenarioBasis": "Small active domestic C corporation with no Illinois net taxable income and allocated paid-in capital at or below $10 million: annual franchise liability is within the $10,000 exemption and income/replacement tax is $0. Excludes report fees and capital-change transactions.", "operatingTaxCaution": "Illinois income/replacement tax uses federal taxable income with state modifications and applicable allocation/apportionment. Qualification can require an IL-1120 filing even without income. Capital allocation for Secretary of State franchise tax uses a different property/business formula and must be calculated separately.", "sources": [ { "label": "Illinois Revenue: C-corporation income and replacement tax rates", "url": "https://tax.illinois.gov/questionsandanswers/answer.83.html", "checked": "2026-10-11", "section": "Illinois Revenue: C-corporation income and replacement tax rates" }, { "label": "Illinois Secretary of State: domestic annual report franchise calculation and 2025-forward exemption", "url": "https://www.ilsos.gov/content/dam/publications/pdf_publications/c289.pdf", "checked": "2026-10-11", "section": "Illinois Secretary of State: domestic annual report franchise calculation and 2025-forward exemption" }, { "label": "Illinois Revenue: corporate base-income and filing requirements", "url": "https://tax.illinois.gov/research/taxinformation/income/corporate.html", "checked": "2026-10-11", "section": "Illinois Revenue: corporate base-income and filing requirements" } ] }, "conversion": { "state": "Illinois", "code": "IL", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 each class/series", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Minimum-status vote: 2/3 each class/series including otherwise nonvoting shares; applies to entry, exit and nonordinary all/substantially-all asset disposition.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K1.10.htm", "section": "805 ILCS 40/1.10" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K2.05.htm", "section": "805 ILCS 40/2.05" }, { "url": "https://www.ilga.gov/documents/legislation/ilcs/documents/080500400K2.10.htm", "section": "805 ILCS 40/2.10" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; specific benefits are optional.", "difference": "Illinois offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Optional director-only charter monetary exculpation for corporation/shareholder fiduciary claims; exceptions loyalty, bad faith, intentional misconduct/knowing law violation, unlawful distributions, improper personal benefit and pre-effective conduct. Benefit-specific rule: Company monetary damages barred under benefit Act for failure to pursue/create benefit. Director and officer protection for compliant conduct and benefit failure; benefit-director exceptions include self-dealing, willful misconduct or knowing law violation.", "difference": "Illinois keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. All corporations require a benefit director, unlike optional/private-exempt models." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder report within 120 days or with other annual report; all reports public website, latest free copy if no website. Report identifies known/record owners of at least 5% and benefit-director opinion. No state benefit-report filing required by this section. Assessment rule: Annual performance assessment must use a third-party standard. Statute requires assessment against a standard but does not require buying certification or external audit in its reporting provision.", "difference": "Illinois: Annual; Required outside framework; no separate state benefit-report filing. An additional benefit-director or approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $75 per year on an annualized basis. Minimum tax/license used here: $0. Small active domestic C corporation with no Illinois net taxable income and allocated paid-in capital at or below $10 million: annual franchise liability is within the $10,000 exemption and income/replacement tax is $0. Excludes report fees and capital-change transactions.", "difference": "Illinois has a compared recurring floor of $75 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 each class/series. Minimum-status vote: 2/3 each class/series including otherwise nonvoting shares; applies to entry, exit and nonordinary all/substantially-all asset disposition. Changing back: 2/3 each class/series", "difference": "Illinois entry uses 2/3 each class/series; exit uses 2/3 each class/series. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory consideration of listed stakeholders; no required priority unless charter specifies one. All benefit corporations must designate an independent benefit director, with special rules when shareholders/others perform board duties. Disclosure: Annual shareholder report within 120 days or with other annual report; all reports public website, latest free copy if no website. Report identifies known/record owners of at least 5% and benefit-director opinion. No state benefit-report filing required by this section. Enforcement: Corporation directly; derivatively any shareholder, director, 5% parent-equity holders, and charter/bylaw designees. No 2% floor on company shareholder.", "difference": "Illinois requires public access to the report. Public report discloses known/record 5% owners. Any shareholder can enforce; no percentage floor." } } }, "guideUrl": "/assets/state-guides/IL.md" }, { "state": "Indiana", "abbreviation": "IN", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit mandatory stakeholder model; 90% mission lock (archival primary)", "features": { "purpose": { "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-4" } ], "confidence": "medium", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "Mandatory general benefit; specific optional." }, "board": { "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-5; 23-1.3-6" } ], "confidence": "medium", "mode": "mandatory_stakeholder_consideration", "summary": "Shall consider listed stakeholders. Independent benefit director mandatory, subject to professional/alternative-board exceptions." }, "standard": { "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-10-1" }, { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-10-3" } ], "confidence": "medium", "required": true, "summary": "Third-party standard required for annual assessment. Report and assessment need no audit/certification.", "thirdPartyRequired": true, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-10-3" } ], "confidence": "medium", "required": false, "summary": "Report and assessment need no audit/certification." }, "report": { "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-10-4 through -6" } ], "confidence": "medium", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": true, "summary": "Annual; shareholder delivery earlier of 120 days or annual-report delivery; all reports public website; concurrent state filing." }, "enforcement": { "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-9-3" } ], "confidence": "medium", "threshold": "2% of a class/series at act", "summary": "Company directly; derivative 2% class/series at act, director, 5% parent, designees." }, "benefitLiability": { "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-5-3; 23-1.3-7-3; 23-1.3-9-2" } ], "confidence": "medium", "company": true, "directors": true, "officers": true, "summary": "Company benefit-failure monetary bar; director/officer compliant-conduct and benefit-failure protection unless bylaws change it." }, "ordinaryExculpation": { "sources": [ { "url": "https://www.in.gov/courts/iocs/files/commercial-court-treatise.pdf", "section": "Indiana courts Commercial Court Treatise, section 5.1.1, pp. 56-57; IC 23-1-35-1(e)" } ], "confidence": "high", "director": true, "officer": false, "optIn": false, "automaticDirectorProtection": true, "automaticOfficerProtection": false, "summary": "Automatic statutory director liability standard under IC 23-1-35-1(e): an act or omission must breach director duties and constitute willful misconduct or recklessness; negligence alone is insufficient. Indiana courts explain that this statutory director business-judgment protection does not extend to acts undertaken in a separate officer or shareholder capacity. This is a director conduct standard, not a blanket immunity from third-party or statutory liability.", "automatic": true }, "statusChange": { "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-2-9; 23-1.3-3; 23-1.3-4-4" } ], "confidence": "medium", "entry": "90% each class/series", "exit": "90% each class/series", "lock": "90% entry and exit", "summary": "90% each class/series, including nonvoting, for entry/exit; 2/3 each class for specific-benefit changes.", "exitVote": "90% each class/series", "entryVote": "90% each class/series" } }, "costs": { "regularReport": { "sources": [ { "url": "https://inbiz.in.gov/business-filings/business-entityreport", "section": "Business Entity Reports" } ], "confidence": "high", "amount": 32, "cadence": "biennial", "online": 32, "paper": 50, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Current INBiz lists $32 online/$50 paper every two years. Another SOS page still says $31 online; prefer current INBiz, note conflict.", "conditions": "Current INBiz lists $32 online/$50 paper every two years. Another SOS page still says $31 online; prefer current INBiz, note conflict." }, "benefitReport": { "sources": [ { "url": "https://www.in.gov/sos/business/files/HUB-Official-comments-and-introductory-note.pdf", "section": "IC 23-0.5-9-6" } ], "confidence": "medium", "amount": 10, "cadence": "annual", "online": 10, "paper": 15, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Separate benefit-report generic statutory filing charge is $15 on paper or $10 when filed electronically under IC 23-0.5-9-6. Use the paper amount when submitting on paper; the electronic amount applies only to an accepted electronic filing. Optional payment/processing and expedited charges are excluded; those are not part of the statutory amount.", "conditions": "Separate benefit-report generic statutory filing charge is $15 on paper or $10 when filed electronically under IC 23-0.5-9-6. Use the paper amount when submitting on paper; the electronic amount applies only to an accepted electronic filing. Optional payment/processing and expedited charges are excluded; those are not part of the statutory amount." }, "minimumTax": { "sources": [ { "url": "https://www.in.gov/dor/files/reference/ib12.pdf", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.in.gov/dor/about/news-publications/our-team/tax-types/", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Indiana Revenue: corporate income tax overview, financial-institution scope, and apportionment", "url": "https://www.in.gov/dor/files/reference/ib12.pdf", "checked": "2026-10-11", "section": "Indiana Revenue: corporate income tax overview, financial-institution scope, and apportionment" }, { "label": "Indiana Revenue: current and historical general-corporation rates", "url": "https://www.in.gov/dor/resources/tax-rates-and-reports/rates-fees-and-penalties/corporate-sales-tax-history/", "checked": "2026-10-11", "section": "Indiana Revenue: current and historical general-corporation rates" } ], "confidence": "high", "amount": 0, "cadence": "annual; liability depends on applicable tax base/exemptions", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "calculationRequired": true, "universalFlatMinimum": false, "summary": "For a civic/technology corporation, ordinary Indiana corporate adjusted-gross-income tax is 4.9% of Indiana taxable income after adjustments/apportionment, rather than a universal flat franchise fee. Indiana financial-institutions franchise tax applies to financial institutions and corporate entities deriving 80% of gross income from financial-institution activities; that is a separate industry rule, not triggered merely by benefit status. Zero taxable income can produce zero ordinary income tax, while filing obligations may remain.", "conditions": "For a civic/technology corporation, ordinary Indiana corporate adjusted-gross-income tax is 4.9% of Indiana taxable income after adjustments/apportionment, rather than a universal flat franchise fee. Indiana financial-institutions franchise tax applies to financial institutions and corporate entities deriving 80% of gross income from financial-institution activities; that is a separate industry rule, not triggered merely by benefit status. Zero taxable income can produce zero ordinary income tax, while filing obligations may remain." } }, "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-4" }, { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-5; 23-1.3-6" }, { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-10-1" }, { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-10-3" }, { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-10-4 through -6" }, { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-9-3" }, { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-5-3; 23-1.3-7-3; 23-1.3-9-2" }, { "url": "https://www.in.gov/courts/iocs/files/commercial-court-treatise.pdf", "section": "Indiana courts Commercial Court Treatise, section 5.1.1, pp. 56-57; IC 23-1-35-1(e)" }, { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-2-9; 23-1.3-3; 23-1.3-4-4" }, { "url": "https://inbiz.in.gov/business-filings/business-entityreport", "section": "Business Entity Reports" }, { "url": "https://www.in.gov/sos/business/files/HUB-Official-comments-and-introductory-note.pdf", "section": "IC 23-0.5-9-6" }, { "url": "https://www.in.gov/dor/files/reference/ib12.pdf", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.in.gov/dor/about/news-publications/our-team/tax-types/", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Indiana Revenue: corporate income tax overview, financial-institution scope, and apportionment", "url": "https://www.in.gov/dor/files/reference/ib12.pdf", "checked": "2026-10-11", "section": "Indiana Revenue: corporate income tax overview, financial-institution scope, and apportionment" }, { "label": "Indiana Revenue: current and historical general-corporation rates", "url": "https://www.in.gov/dor/resources/tax-rates-and-reports/rates-fees-and-penalties/corporate-sales-tax-history/", "checked": "2026-10-11", "section": "Indiana Revenue: current and historical general-corporation rates" } ], "differences": [ "90% entry/exit threshold exceeds common 2/3.", "Independent benefit director mandatory.", "Benefit report is state-filed with separate fee." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "Benefit features read in 2015 enacted HEA 1015, primary enrolled legislative text mirrored by LegiScan; Indiana agency-published 2017 harmonization code/commentary used for generic filing charges. Current official code application did not render readable text. Ordinary director scope is documented by the current official Indiana courts Commercial Court Treatise. These source dates are retained, not represented as fresh official-code retrieval.", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Indiana offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 19, 19 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Indiana has an identified director monetary-protection provision in the compared scope, which earns this credit. Automatic statutory director liability standard under IC 23-1-35-1(e): an act or omission must breach director duties and constitute willful misconduct or recklessness; negligence alone is insufficient. Indiana courts explain that this statutory director business-judgment protection does not extend to acts undertaken in a separate officer or shareholder capacity. This is a director conduct standard, not a blanket immunity from third-party or statutory liability.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Indiana does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 3, 3 ], "reason": "Statutory coverage in the selected scope receives the 3-point default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Indiana has a default statutory liability rule in the compared scope, so it earns the automatic-coverage credit. Articles and retained exceptions still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Indiana earns the benefit-specific credit for company. Company benefit-failure monetary bar; director/officer compliant-conduct and benefit-failure protection unless bylaws change it.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Indiana earns the benefit-specific credit for directors. Company benefit-failure monetary bar; director/officer compliant-conduct and benefit-failure protection unless bylaws change it.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Indiana earns the benefit-specific credit for officers. Company benefit-failure monetary bar; director/officer compliant-conduct and benefit-failure protection unless bylaws change it.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 8, 8 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Indiana: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Indiana: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Indiana: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "Mandatory benefit director or report-approval procedure in this private-company scope: no 3-point flexibility bonus.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Indiana requires an additional benefit-director or report-approval procedure in this private-company scope, so it receives no no-extra-step credit. Shall consider listed stakeholders. Independent benefit director mandatory, subject to professional/alternative-board exceptions.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $16 + benefit filing $10 = $26 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Indiana has a compared recurring floor of $26 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation operating in Indiana with no Indiana adjusted gross income subject to tax after state adjustments: $0 ordinary corporate tax and no separate general franchise/capital minimum. Excludes report and operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 4, 4 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 2, 2 ], "reason": "90% each class/series, including nonvoting, for entry/exit; 2/3 each class for specific-benefit changes.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Indiana: becoming a benefit company requires 90% each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 2, 2 ], "reason": "90% default benefit exit gate: 2 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Indiana: changing back requires 90% each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Indiana requires report access for people outside the company, so it earns public-access credit. Annual; shareholder delivery earlier of 120 days or annual-report delivery; all reports public website; concurrent state filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Indiana: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Indiana: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Indiana makes a mission duty mandatory, so it earns this credit. Shall consider listed stakeholders. Independent benefit director mandatory, subject to professional/alternative-board exceptions.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 26.0, "ordinaryScope": { "director": true, "officer": false, "automatic": true }, "exitCategory": "ninety", "specialProcedure": true, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 26.0, "minimumTaxAnnualized": 0, "entryCategory": "ninety" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Ninety-percent default" }, "scoreRange": [ 72, 72 ], "tax": { "code": "IN", "incomeSummary": "Ordinary Indiana C-corporation adjusted gross income tax is a flat 4.9% of Indiana taxable adjusted gross income. The 4.9% rate has applied since July 1, 2021 and remains the current general-corporation rate.", "recurringSummary": "The ordinary civic/technology corporation is subject to income-based adjusted gross income tax, with no separate general fixed franchise or capital-tax minimum in this regime. Indiana's financial-institutions franchise tax is a separate rule for financial institutions and corporate entities deriving 80% of gross income from covered financial activities. Business entity report fees are separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive general tax floor solely for an ordinary domestic stock C corporation. The 4.9% income computation can be zero; industry-specific financial-institution taxation and registry/report fees are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation operating in Indiana with no Indiana adjusted gross income subject to tax after state adjustments: $0 ordinary corporate tax and no separate general franchise/capital minimum. Excludes report and operating taxes.", "operatingTaxCaution": "Doing business in Indiana can create income-tax liability regardless of charter state. Indiana generally apportions multistate corporate business income using a single receipts factor; services and most intangibles use Indiana market sourcing. State adjustments and federal statutory protection can change the result, and filing duties are separate from tax payable.", "sources": [ { "label": "Indiana Revenue: corporate income tax overview, financial-institution scope, and apportionment", "url": "https://www.in.gov/dor/files/reference/ib12.pdf", "checked": "2026-10-11", "section": "Indiana Revenue: corporate income tax overview, financial-institution scope, and apportionment" }, { "label": "Indiana Revenue: current and historical general-corporation rates", "url": "https://www.in.gov/dor/resources/tax-rates-and-reports/rates-fees-and-penalties/corporate-sales-tax-history/", "checked": "2026-10-11", "section": "Indiana Revenue: current and historical general-corporation rates" } ] }, "conversion": { "state": "Indiana", "code": "IN", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "90% each class/series", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "90% each class/series, including nonvoting, for entry/exit; 2/3 each class for specific-benefit changes.", "proposal": "Replace the 90% each-class entry gate with ordinary amendment voting; decide exit protection separately.", "sources": [ { "url": "https://legiscan.com/IN/text/HB1015/id/1213412/Indiana-2015-HB1015-Enrolled.pdf", "section": "Indiana HEA 1015 (2015), enacted text / IC 23-1.3-2-9; 23-1.3-3; 23-1.3-4-4" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mandatory general benefit; specific optional.", "difference": "Indiana offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Automatic statutory director liability standard under IC 23-1-35-1(e): an act or omission must breach director duties and constitute willful misconduct or recklessness; negligence alone is insufficient. Indiana courts explain that this statutory director business-judgment protection does not extend to acts undertaken in a separate officer or shareholder capacity. This is a director conduct standard, not a blanket immunity from third-party or statutory liability. Benefit-specific rule: Company benefit-failure monetary bar; director/officer compliant-conduct and benefit-failure protection unless bylaws change it.", "difference": "Indiana keeps this ordinary shield limited to directors and a default statutory liability rule. Independent benefit director mandatory." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual; shareholder delivery earlier of 120 days or annual-report delivery; all reports public website; concurrent state filing. Assessment rule: Third-party standard required for annual assessment. Report and assessment need no audit/certification.", "difference": "Indiana: Annual; Required outside framework; state benefit-report filing. An additional benefit-director or approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $26 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation operating in Indiana with no Indiana adjusted gross income subject to tax after state adjustments: $0 ordinary corporate tax and no separate general franchise/capital minimum. Excludes report and operating taxes.", "difference": "Indiana has a compared recurring floor of $26 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 90% each class/series. 90% each class/series, including nonvoting, for entry/exit; 2/3 each class for specific-benefit changes. Changing back: 90% each class/series", "difference": "Indiana entry uses 90% each class/series; exit uses 90% each class/series. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Shall consider listed stakeholders. Independent benefit director mandatory, subject to professional/alternative-board exceptions. Disclosure: Annual; shareholder delivery earlier of 120 days or annual-report delivery; all reports public website; concurrent state filing. Enforcement: Company directly; derivative 2% class/series at act, director, 5% parent, designees.", "difference": "Indiana requires public access to the report. 90% entry/exit threshold exceeds common 2/3. Benefit report is state-filed with separate fee." } } }, "guideUrl": "/assets/state-guides/IN.md" }, { "state": "Iowa", "abbreviation": "IA", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "Responsible/sustainable mandatory consideration model, revised 2022", "features": { "purpose": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1701.pdf", "section": "Iowa Code 2026 490.1701" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1704.pdf", "section": "Iowa Code 2026 490.1704" } ], "confidence": "high", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "Responsible/sustainable conduct requires material positive society/environment effect proportionate to business size/nature; identified public benefits may be added in articles." }, "board": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1704.pdf", "section": "Iowa Code 2026 490.1704" } ], "confidence": "high", "mode": "mandatory_stakeholder_consideration", "summary": "Directors shall pursue responsible/sustainable business, identified benefits, and consider shareholders plus known affected stakeholders. No duty to persons merely because affected. Unless articles say otherwise, benefit-duty failure is not intentional harm for specified exculpation/indemnification." }, "standard": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1705.pdf", "section": "Iowa Code 2026 490.1705" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1705.pdf", "section": "Iowa Code 2026 490.1705" } ], "confidence": "high", "required": false, "summary": "Optional: articles/bylaws may require a third-party standard or board may choose one. No mandatory third-party certification in reporting requirement.", "thirdPartyRequired": false, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1705.pdf", "section": "Iowa Code 2026 490.1705" } ], "confidence": "high", "required": false, "summary": "No mandatory third-party certification in reporting requirement." }, "report": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1705.pdf", "section": "Iowa Code 2026 490.1705" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "summary": "Annual objectives/standards/factual assessment; shareholder access/delivery before earlier 120 days or annual financials. All reports public website/latest free on request. Missing report request enforceable after five business days. No state benefit-report filing." }, "enforcement": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1706.pdf", "section": "Iowa Code 2026 490.1706" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1705.pdf", "section": "Iowa Code 2026 490.1705" } ], "confidence": "high", "threshold": "5% class at act; market alternative $5m", "summary": "Corporation or derivative shareholder with 5% of a class at challenged act; organized-market alternative 5%/$5m. Continuous holding requirement applies. Any shareholder separately may enforce report access." }, "benefitLiability": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1704.pdf", "section": "Iowa Code 2026 490.1704" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1706.pdf", "section": "Iowa Code 2026 490.1706" } ], "confidence": "high", "company": false, "directors": false, "officers": false, "summary": "No express blanket company/director/officer benefit-failure monetary bar in this subchapter; ordinary liability rules plus benefit-duty intentional-harm safe harbor apply." }, "ordinaryExculpation": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.202.pdf", "section": "Iowa Code 2026 490.202" } ], "confidence": "high", "director": true, "officer": false, "optIn": true, "summary": "Optional director-only charter monetary limitation; exceptions improper financial benefit, intentional harm, unlawful distributions and intentional criminal violation.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1703.pdf", "section": "Iowa Code 2026 490.1703" } ], "confidence": "high", "entry": "2/3 entitled voting power", "exit": "2/3 entitled voting power", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "Entry/exit by amendment or covered merger/exchange/domestication/conversion: 2/3 voting power entitled plus 2/3 each separate affected voting group; greater articles/bylaws permitted. Includes identified-benefit change rules in provision.", "exitVote": "2/3 entitled voting power", "entryVote": "2/3 entitled voting power" } }, "costs": { "regularReport": { "sources": [ { "url": "https://sos.iowa.gov/businesses/business-entity-forms-and-fees", "section": "Biennial Report / Profit Corporations" } ], "confidence": "high", "amount": 60, "cadence": "biennial", "online": 60, "paper": 60, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Profit-corporation biennial report $60, due April 1 of even years. $30-online/$45-paper on same fee page belongs to LLC/LLP, not profit corporation.", "conditions": "Profit-corporation biennial report $60, due April 1 of even years. $30-online/$45-paper on same fee page belongs to LLC/LLP, not profit corporation." }, "benefitReport": { "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1705.pdf", "section": "Iowa Code 2026 490.1705" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://revenue.iowa.gov/news/2025-10-21/idr-issues-order-related-tax-year-2026-corporate-income-tax-rates", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://revenue.iowa.gov/taxes/tax-guidance/general/iowa-taxfee-descriptions-and-rates", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Iowa Revenue: certified tax-year 2026 corporate rates", "url": "https://revenue.iowa.gov/news/2025-10-21/idr-issues-order-related-tax-year-2026-corporate-income-tax-rates", "checked": "2026-10-11", "section": "Iowa Revenue: certified tax-year 2026 corporate rates" }, { "label": "Iowa Revenue: tax descriptions, corporate rates, AMT end date, and financial-institution franchise scope", "url": "https://revenue.iowa.gov/taxes/tax-guidance/general/iowa-taxfee-descriptions-and-rates", "checked": "2026-10-11", "section": "Iowa Revenue: tax descriptions, corporate rates, AMT end date, and financial-institution franchise scope" }, { "label": "Iowa Revenue: October 2026 certification announcement for tax-year 2027", "url": "https://revenue.iowa.gov/news/2026-10-05/idr-issues-order-related-tax-year-2027-corporate-income-tax-rates", "checked": "2026-10-11", "section": "Iowa Revenue: October 2026 certification announcement for tax-year 2027" } ], "confidence": "high", "amount": 0, "cadence": "annual; liability depends on applicable tax base/exemptions", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "calculationRequired": true, "universalFlatMinimum": false, "summary": "For an ordinary civic/technology C corporation with Iowa taxable income, 2026 corporate income tax is 5.5% on the first $100,000 and 7.1% above $100,000. This is income-based, not a universal annual minimum franchise payment. Iowa franchise tax is a financial-institution tax (3.8% for 2026), applying to enumerated banks/trust/savings/credit institutions; it does not apply merely because a corporation is a benefit corporation. Nexus, exemptions and apportionment determine the taxable amount.", "conditions": "For an ordinary civic/technology C corporation with Iowa taxable income, 2026 corporate income tax is 5.5% on the first $100,000 and 7.1% above $100,000. This is income-based, not a universal annual minimum franchise payment. Iowa franchise tax is a financial-institution tax (3.8% for 2026), applying to enumerated banks/trust/savings/credit institutions; it does not apply merely because a corporation is a benefit corporation. Nexus, exemptions and apportionment determine the taxable amount." } }, "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1701.pdf", "section": "Iowa Code 2026 490.1701" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1704.pdf", "section": "Iowa Code 2026 490.1704" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1705.pdf", "section": "Iowa Code 2026 490.1705" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1706.pdf", "section": "Iowa Code 2026 490.1706" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.202.pdf", "section": "Iowa Code 2026 490.202" }, { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1703.pdf", "section": "Iowa Code 2026 490.1703" }, { "url": "https://sos.iowa.gov/businesses/business-entity-forms-and-fees", "section": "Biennial Report / Profit Corporations" }, { "url": "https://revenue.iowa.gov/news/2025-10-21/idr-issues-order-related-tax-year-2026-corporate-income-tax-rates", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://revenue.iowa.gov/taxes/tax-guidance/general/iowa-taxfee-descriptions-and-rates", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Iowa Revenue: certified tax-year 2026 corporate rates", "url": "https://revenue.iowa.gov/news/2025-10-21/idr-issues-order-related-tax-year-2026-corporate-income-tax-rates", "checked": "2026-10-11", "section": "Iowa Revenue: certified tax-year 2026 corporate rates" }, { "label": "Iowa Revenue: tax descriptions, corporate rates, AMT end date, and financial-institution franchise scope", "url": "https://revenue.iowa.gov/taxes/tax-guidance/general/iowa-taxfee-descriptions-and-rates", "checked": "2026-10-11", "section": "Iowa Revenue: tax descriptions, corporate rates, AMT end date, and financial-institution franchise scope" }, { "label": "Iowa Revenue: October 2026 certification announcement for tax-year 2027", "url": "https://revenue.iowa.gov/news/2026-10-05/idr-issues-order-related-tax-year-2027-corporate-income-tax-rates", "checked": "2026-10-11", "section": "Iowa Revenue: October 2026 certification announcement for tax-year 2027" } ], "differences": [ "Optional third-party standard despite mandatory public annual reporting.", "5%/$5m enforcement threshold exceeds 2%/$2m PBC models.", "Current law replaced former benefit subchapter January 1, 2022; older 2% model descriptions are obsolete." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Iowa offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 8, 8 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Iowa has an identified director monetary-protection provision in the compared scope, which earns this credit. Optional director-only charter monetary limitation; exceptions improper financial benefit, intentional harm, unlawful distributions and intentional criminal violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Iowa does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Iowa requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit decision / classification safe harbor", "range": [ 2, 2 ], "reason": "2 points instead of the separate company/director/officer outcome-bar credits. The cited safe harbor is not treated as a blanket mission-failure damages bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection for benefit decisions", "why": "Iowa protects certain properly made or classified benefit decisions. This is narrower than an express company/director/officer bar on damages merely for missing the mission, so only the narrower safe-harbor credit applies. No express blanket company/director/officer benefit-failure monetary bar in this subchapter; ordinary liability rules plus benefit-duty intentional-harm safe harbor apply.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Iowa: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Iowa: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Iowa: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Iowa has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $30 + benefit filing $0 = $30 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Iowa has a compared recurring floor of $30 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation operating in Iowa with no Iowa taxable income after state adjustments: $0 ordinary income tax and no separate general franchise/capital minimum. This does not include registry fees or other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry/exit by amendment or covered merger/exchange/domestication/conversion: 2/3 voting power entitled plus 2/3 each separate affected voting group; greater articles/bylaws permitted. Includes identified-benefit change rules in provision.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Iowa: becoming a benefit company requires 2/3 entitled voting power. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Iowa: changing back requires 2/3 entitled voting power. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 17, 17 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Iowa requires report access for people outside the company, so it earns public-access credit. Annual objectives/standards/factual assessment; shareholder access/delivery before earlier 120 days or annual financials. All reports public website/latest free on request. Missing report request enforceable after five business days. No state benefit-report filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Iowa: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Iowa: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Iowa makes a mission duty mandatory, so it earns this credit. Directors shall pursue responsible/sustainable business, identified benefits, and consider shareholders plus known affected stakeholders. No duty to persons merely because affected. Unless articles say otherwise, benefit-duty failure is not intentional harm for specified exculpation/indemnification.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 30.0, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 30.0, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 74, 74 ], "tax": { "code": "IA", "incomeSummary": "For tax years beginning in 2026, ordinary corporate income tax is 5.5% on the first $100,000 of Iowa taxable income and 7.1% on income above $100,000. The Revenue Department certified that the revenue trigger did not lower the rates for 2026; its October 5, 2026 announcement also keeps these rates for 2027.", "recurringSummary": "No general fixed corporate franchise or capital-tax minimum for an ordinary civic/technology stock C corporation. Iowa's separately named franchise tax applies to enumerated financial institutions, not ordinary corporations; its 2026 rate is 3.8%. The former ordinary corporate alternative minimum tax ended for tax years beginning in 2021. Secretary of State report fees are separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive tax is imposed solely by ordinary domestic stock-corporation status in the cited corporate regime. Income-based liability is not a fixed charter charge; financial-institution taxation and report fees are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation operating in Iowa with no Iowa taxable income after state adjustments: $0 ordinary income tax and no separate general franchise/capital minimum. This does not include registry fees or other operating taxes.", "operatingTaxCaution": "Iowa taxes corporate net income from doing business or receiving income from property in Iowa. Nexus, state modifications, apportionment, losses, and credits determine liability; a zero-profit assumption means zero Iowa taxable income after those adjustments. Forming in another state does not eliminate Iowa tax on Iowa activity.", "sources": [ { "label": "Iowa Revenue: certified tax-year 2026 corporate rates", "url": "https://revenue.iowa.gov/news/2025-10-21/idr-issues-order-related-tax-year-2026-corporate-income-tax-rates", "checked": "2026-10-11", "section": "Iowa Revenue: certified tax-year 2026 corporate rates" }, { "label": "Iowa Revenue: tax descriptions, corporate rates, AMT end date, and financial-institution franchise scope", "url": "https://revenue.iowa.gov/taxes/tax-guidance/general/iowa-taxfee-descriptions-and-rates", "checked": "2026-10-11", "section": "Iowa Revenue: tax descriptions, corporate rates, AMT end date, and financial-institution franchise scope" }, { "label": "Iowa Revenue: October 2026 certification announcement for tax-year 2027", "url": "https://revenue.iowa.gov/news/2026-10-05/idr-issues-order-related-tax-year-2027-corporate-income-tax-rates", "checked": "2026-10-11", "section": "Iowa Revenue: October 2026 certification announcement for tax-year 2027" } ] }, "conversion": { "state": "Iowa", "code": "IA", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 entitled voting power", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry/exit by amendment or covered merger/exchange/domestication/conversion: 2/3 voting power entitled plus 2/3 each separate affected voting group; greater articles/bylaws permitted. Includes identified-benefit change rules in provision.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.legis.iowa.gov/docs/code/2026/490.1703.pdf", "section": "Iowa Code 2026 490.1703" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Responsible/sustainable conduct requires material positive society/environment effect proportionate to business size/nature; identified public benefits may be added in articles.", "difference": "Iowa offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Optional director-only charter monetary limitation; exceptions improper financial benefit, intentional harm, unlawful distributions and intentional criminal violation. Benefit-specific rule: No express blanket company/director/officer benefit-failure monetary bar in this subchapter; ordinary liability rules plus benefit-duty intentional-harm safe harbor apply.", "difference": "Iowa keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. " }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual objectives/standards/factual assessment; shareholder access/delivery before earlier 120 days or annual financials. All reports public website/latest free on request. Missing report request enforceable after five business days. No state benefit-report filing. Assessment rule: Optional: articles/bylaws may require a third-party standard or board may choose one. No mandatory third-party certification in reporting requirement.", "difference": "Iowa: Annual; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $30 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation operating in Iowa with no Iowa taxable income after state adjustments: $0 ordinary income tax and no separate general franchise/capital minimum. This does not include registry fees or other operating taxes.", "difference": "Iowa has a compared recurring floor of $30 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 entitled voting power. Entry/exit by amendment or covered merger/exchange/domestication/conversion: 2/3 voting power entitled plus 2/3 each separate affected voting group; greater articles/bylaws permitted. Includes identified-benefit change rules in provision. Changing back: 2/3 entitled voting power", "difference": "Iowa entry uses 2/3 entitled voting power; exit uses 2/3 entitled voting power. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors shall pursue responsible/sustainable business, identified benefits, and consider shareholders plus known affected stakeholders. No duty to persons merely because affected. Unless articles say otherwise, benefit-duty failure is not intentional harm for specified exculpation/indemnification. Disclosure: Annual objectives/standards/factual assessment; shareholder access/delivery before earlier 120 days or annual financials. All reports public website/latest free on request. Missing report request enforceable after five business days. No state benefit-report filing. Enforcement: Corporation or derivative shareholder with 5% of a class at challenged act; organized-market alternative 5%/$5m. Continuous holding requirement applies. Any shareholder separately may enforce report access.", "difference": "Iowa requires public access to the report. Optional third-party standard despite mandatory public annual reporting. 5%/$5m enforcement threshold exceeds 2%/$2m PBC models." } } }, "guideUrl": "/assets/state-guides/IA.md" }, { "state": "Kansas", "abbreviation": "KS", "form": "Public benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "Specific-benefit three-interest balancing with mandatory third-party public annual report", "features": { "purpose": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0002_section/017_072a_0002_k/", "section": "K.S.A. 17-72a02" } ], "confidence": "high", "generalRequired": false, "specificRequired": true, "specificOptional": false, "summary": "Responsible/sustainable for-profit corporation must name one or more specific public benefits in articles; no separate broad general-benefit purpose imposed." }, "board": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0005_section/017_072a_0005_k/", "section": "K.S.A. 17-72a05" } ], "confidence": "high", "mode": "three_interest_balancing", "summary": "Must balance stockholder pecuniary interests, materially affected interests and chosen benefits; informed/disinterested/rational-decision safe harbor. Since 2023, stockholding alone is not conflict and disinterested balancing failure is not bad faith/loyalty breach unless articles opt out." }, "standard": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0006_section/017_072a_0006_k/", "section": "K.S.A. 17-72a06" }, { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0006_section/017_072a_0006_k/", "section": "K.S.A. 17-72a06" } ], "confidence": "high", "required": true, "summary": "Annual statement must assess benefit performance against independent transparent third-party standard. Third-party certification may be required by articles/bylaws; not statutory default.", "thirdPartyRequired": true, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0006_section/017_072a_0006_k/", "section": "K.S.A. 17-72a06" } ], "confidence": "high", "required": false, "summary": "Third-party certification may be required by articles/bylaws; not statutory default." }, "report": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0006_section/017_072a_0006_k/", "section": "K.S.A. 17-72a06" }, { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_075_0000_article/017_075_0003_section/017_075_0003_k/", "section": "K.S.A. 17-7503: biennial information reports" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "summary": "Annual benefit statement to shareholders, latest publicly posted or free on request; third-party assessment required. Timing refers to ordinary report statute, now biennial, creating a timing cross-reference to check. No state benefit-report filing specified. The current 2026 text still says no less than annually in 17-72a06(b), while subsection (c) links timing to the annual report under 17-7503; section 17-7503 now governs biennial information reports. The annual benefit-statement duty remains explicit, but the cross-reference does not give a clear intervening-year delivery date. A company should set an annual shareholder/publication date and confirm that timing with counsel rather than reduce the benefit report to biennial." }, "enforcement": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0007_section/017_072a_0007_k/", "section": "K.S.A. 17-72a07" } ], "confidence": "high", "threshold": "2% total at filing; listed alternative $2m", "summary": "Any individual/derivative/other action enforcing balancing requires at filing 2% total outstanding or listed lesser 2%/$2m; other derivative rules remain." }, "benefitLiability": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0005_section/017_072a_0005_k/", "section": "K.S.A. 17-72a05" }, { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0007_section/017_072a_0007_k/", "section": "K.S.A. 17-72a07" } ], "confidence": "high", "company": false, "directors": false, "officers": false, "summary": "No blanket company/director/officer benefit-failure monetary bar. Director balancing safe harbor and default protection against bad-faith/loyalty classification interact with ordinary charter exculpation." }, "ordinaryExculpation": { "sources": [ { "url": "https://ksrevisor.gov/statutes/chapters/ch17/017_060_0002.html", "section": "K.S.A. 17-6002(b)(8)" } ], "confidence": "high", "director": true, "officer": false, "optIn": true, "summary": "Optional director-only charter monetary exculpation; exceptions loyalty, bad faith/intentional misconduct/knowing law violation, unlawful distributions and improper benefit. Prospective.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/", "section": "2026 Article 72a index; section 17-72a03 repealed" }, { "url": "https://ksrevisor.gov/statutes/chapters/ch17/017_066_0002.html", "section": "K.S.A. 17-6602(b)(1),(2),(4)" } ], "confidence": "high", "entry": "ordinary majority of outstanding entitled stock (charter amendment)", "exit": "ordinary majority of outstanding entitled stock (charter amendment)", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "Prior benefit-specific 17-72a03 was repealed in 2023. Entry/exit by charter amendment now uses ordinary board approval and majority of outstanding stock entitled to vote, plus majority of each class separately entitled to vote. Class votes and greater charter thresholds may apply; other transaction routes retain their own rules.", "exitVote": "ordinary majority of outstanding entitled stock (charter amendment)", "entryVote": "ordinary majority of outstanding entitled stock (charter amendment)" } }, "costs": { "regularReport": { "sources": [ { "url": "https://sos.ks.gov/forms/business_services/IFP.pdf", "section": "For-Profit Information Report, Rev. 7/22/26" } ], "confidence": "high", "amount": 90, "cadence": "biennial", "online": 90, "paper": 110, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Current July 22, 2026 form: $90 online/$110 paper biennial for-profit information report, including current regulatory fees.", "conditions": "Current July 22, 2026 form: $90 online/$110 paper biennial for-profit information report, including current regulatory fees." }, "benefitReport": { "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0006_section/017_072a_0006_k/", "section": "K.S.A. 17-72a06" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://ksrevenue.gov/bustaxtypesfranchise.html", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.ksrevenue.gov/taxnotices/notice23-10.pdf", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Kansas Revenue: 2025 corporate tax booklet, filing scope and normal/surtax calculation", "url": "https://www.ksrevenue.gov/corpbook25.html", "checked": "2026-10-11", "section": "Kansas Revenue: 2025 corporate tax booklet, filing scope and normal/surtax calculation" }, { "label": "Kansas Revenue: franchise tax ended for 2011 and later", "url": "https://ksrevenue.gov/bustaxtypesfranchise.html", "checked": "2026-10-11", "section": "Kansas Revenue: franchise tax ended for 2011 and later" }, { "label": "Kansas Revenue: enacted 2024 corporate normal rate", "url": "https://ksrevenue.gov/pdf/LegislativeChanges.pdf", "checked": "2026-10-11", "section": "Kansas Revenue: enacted 2024 corporate normal rate" } ], "confidence": "high", "amount": 0, "cadence": "annual; liability depends on applicable tax base/exemptions", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "calculationRequired": true, "universalFlatMinimum": false, "summary": "Kansas franchise tax has been eliminated for tax year 2011 and later. Corporate income tax is separate: 3.5% normal tax on Kansas taxable income plus a 3% surtax on Kansas taxable income exceeding $50,000. Nexus, allocation/apportionment and credits determine actual liability; no former franchise-tax floor is added to the biennial registry charge.", "conditions": "Kansas franchise tax has been eliminated for tax year 2011 and later. Corporate income tax is separate: 3.5% normal tax on Kansas taxable income plus a 3% surtax on Kansas taxable income exceeding $50,000. Nexus, allocation/apportionment and credits determine actual liability; no former franchise-tax floor is added to the biennial registry charge." } }, "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0002_section/017_072a_0002_k/", "section": "K.S.A. 17-72a02" }, { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0005_section/017_072a_0005_k/", "section": "K.S.A. 17-72a05" }, { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0006_section/017_072a_0006_k/", "section": "K.S.A. 17-72a06" }, { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_075_0000_article/017_075_0003_section/017_075_0003_k/", "section": "K.S.A. 17-7503: biennial information reports" }, { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/017_072a_0007_section/017_072a_0007_k/", "section": "K.S.A. 17-72a07" }, { "url": "https://ksrevisor.gov/statutes/chapters/ch17/017_060_0002.html", "section": "K.S.A. 17-6002(b)(8)" }, { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/", "section": "2026 Article 72a index; section 17-72a03 repealed" }, { "url": "https://ksrevisor.gov/statutes/chapters/ch17/017_066_0002.html", "section": "K.S.A. 17-6602(b)(1),(2),(4)" }, { "url": "https://sos.ks.gov/forms/business_services/IFP.pdf", "section": "For-Profit Information Report, Rev. 7/22/26" }, { "url": "https://ksrevenue.gov/bustaxtypesfranchise.html", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.ksrevenue.gov/taxnotices/notice23-10.pdf", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Kansas Revenue: 2025 corporate tax booklet, filing scope and normal/surtax calculation", "url": "https://www.ksrevenue.gov/corpbook25.html", "checked": "2026-10-11", "section": "Kansas Revenue: 2025 corporate tax booklet, filing scope and normal/surtax calculation" }, { "label": "Kansas Revenue: franchise tax ended for 2011 and later", "url": "https://ksrevenue.gov/bustaxtypesfranchise.html", "checked": "2026-10-11", "section": "Kansas Revenue: franchise tax ended for 2011 and later" }, { "label": "Kansas Revenue: enacted 2024 corporate normal rate", "url": "https://ksrevenue.gov/pdf/LegislativeChanges.pdf", "checked": "2026-10-11", "section": "Kansas Revenue: enacted 2024 corporate normal rate" } ], "differences": [ "Three-interest balancing combined with mandatory public annual third-party report; not the same reporting regime as Delaware/Texas.", "2023 protection is default unless charter opts out.", "Old benefit-specific supermajority provision repealed." ], "gaps": [ "Genuine statutory timing mismatch: annual benefit-statement duty in 17-72a06(b) coexists with subsection (c) referring to the now-biennial information-report schedule in 17-7503; no specific intervening-year date is supplied." ], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Public benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Kansas offers Public benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 8, 8 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Kansas has an identified director monetary-protection provision in the compared scope, which earns this credit. Optional director-only charter monetary exculpation; exceptions loyalty, bad faith/intentional misconduct/knowing law violation, unlawful distributions and improper benefit. Prospective.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Kansas does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Kansas requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit decision / classification safe harbor", "range": [ 2, 2 ], "reason": "2 points instead of the separate company/director/officer outcome-bar credits. The cited safe harbor is not treated as a blanket mission-failure damages bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection for benefit decisions", "why": "Kansas protects certain properly made or classified benefit decisions. This is narrower than an express company/director/officer bar on damages merely for missing the mission, so only the narrower safe-harbor credit applies. No blanket company/director/officer benefit-failure monetary bar. Director balancing safe harbor and default protection against bad-faith/loyalty classification interact with ordinary charter exculpation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Kansas: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Kansas: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Kansas: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Kansas has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $45 + benefit filing $0 = $45 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Kansas has a compared recurring floor of $45 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation operating in Kansas with no Kansas taxable income after adjustments and apportionment: $0 ordinary income tax and no franchise minimum. Excludes information-report fees and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 10, 10 ], "reason": "Prior benefit-specific 17-72a03 was repealed in 2023. Entry/exit by charter amendment now uses ordinary board approval and majority of outstanding stock entitled to vote, plus majority of each class separately entitled to vote. Class votes and greater charter thresholds may apply; other transaction routes retain their own rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Kansas: becoming a benefit company requires ordinary majority of outstanding entitled stock (charter amendment). Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 10, 10 ], "reason": "No added benefit-status supermajority: 10 points. Ordinary transaction votes and any higher charter votes still apply. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Kansas: changing back requires ordinary majority of outstanding entitled stock (charter amendment). Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Kansas requires report access for people outside the company, so it earns public-access credit. Annual benefit statement to shareholders, latest publicly posted or free on request; third-party assessment required. Timing refers to ordinary report statute, now biennial, creating a timing cross-reference to check. No state benefit-report filing specified. The current 2026 text still says no less than annually in 17-72a06(b), while subsection (c) links timing to the annual report under 17-7503; section 17-7503 now governs biennial information reports. The annual benefit-statement duty remains explicit, but the cross-reference does not give a clear intervening-year delivery date. A company should set an annual shareholder/publication date and confirm that timing with counsel rather than reduce the benefit report to biennial.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Kansas: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Kansas: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Kansas makes a mission duty mandatory, so it earns this credit. Must balance stockholder pecuniary interests, materially affected interests and chosen benefits; informed/disinterested/rational-decision safe harbor. Since 2023, stockholding alone is not conflict and disinterested balancing failure is not bad faith/loyalty breach unless articles opt out.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 45.0, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "ordinary", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 45.0, "minimumTaxAnnualized": 0, "entryCategory": "ordinary" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Ordinary transaction votes" }, "scoreRange": [ 75, 75 ], "tax": { "code": "KS", "incomeSummary": "Kansas ordinary corporate income tax is 3.5% of Kansas taxable income plus a 3% surtax on the portion above $50,000, producing a 6.5% marginal rate above that threshold. This 3.5% normal rate applies from tax year 2024 onward.", "recurringSummary": "Kansas franchise tax was eliminated for tax year 2011 and later. The ordinary corporation has no surviving general fixed franchise/capital minimum; corporate income tax remains a separate calculation. Secretary of State information-report charges are separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive annual franchise-tax floor for an ordinary domestic stock corporation because the franchise tax ended; income tax and registry/report fees are outside a fixed charter-only floor.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation operating in Kansas with no Kansas taxable income after adjustments and apportionment: $0 ordinary income tax and no franchise minimum. Excludes information-report fees and other operating taxes.", "operatingTaxCaution": "Corporations doing business in Kansas or deriving Kansas-source income must generally file even when no tax is due. Allocation, apportionment, unitary-group rules, federal P.L. 86-272 protection, and credits determine actual income-tax liability; chartering elsewhere does not remove Kansas-source taxation.", "sources": [ { "label": "Kansas Revenue: 2025 corporate tax booklet, filing scope and normal/surtax calculation", "url": "https://www.ksrevenue.gov/corpbook25.html", "checked": "2026-10-11", "section": "Kansas Revenue: 2025 corporate tax booklet, filing scope and normal/surtax calculation" }, { "label": "Kansas Revenue: franchise tax ended for 2011 and later", "url": "https://ksrevenue.gov/bustaxtypesfranchise.html", "checked": "2026-10-11", "section": "Kansas Revenue: franchise tax ended for 2011 and later" }, { "label": "Kansas Revenue: enacted 2024 corporate normal rate", "url": "https://ksrevenue.gov/pdf/LegislativeChanges.pdf", "checked": "2026-10-11", "section": "Kansas Revenue: enacted 2024 corporate normal rate" } ] }, "conversion": { "state": "Kansas", "code": "KS", "form": "Public benefit corporation", "status": "Available", "group": "ordinary", "groupLabel": "Ordinary / qualified-majority route", "entryVote": "ordinary majority of outstanding entitled stock (charter amendment)", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Prior benefit-specific 17-72a03 was repealed in 2023. Entry/exit by charter amendment now uses ordinary board approval and majority of outstanding stock entitled to vote, plus majority of each class separately entitled to vote. Class votes and greater charter thresholds may apply; other transaction routes retain their own rules.", "proposal": "Preserve the ordinary or qualified-majority route; improve forms, costs, notices and reporting without overriding charter or contract rights.", "sources": [ { "url": "https://www.kslegislature.gov/b2025_26/laws/017_000_0000_chapter/017_072a_0000_article/", "section": "2026 Article 72a index; section 17-72a03 repealed" }, { "url": "https://ksrevisor.gov/statutes/chapters/ch17/017_066_0002.html", "section": "K.S.A. 17-6602(b)(1),(2),(4)" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Responsible/sustainable for-profit corporation must name one or more specific public benefits in articles; no separate broad general-benefit purpose imposed.", "difference": "Kansas offers Public benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Optional director-only charter monetary exculpation; exceptions loyalty, bad faith/intentional misconduct/knowing law violation, unlawful distributions and improper benefit. Prospective. Benefit-specific rule: No blanket company/director/officer benefit-failure monetary bar. Director balancing safe harbor and default protection against bad-faith/loyalty classification interact with ordinary charter exculpation.", "difference": "Kansas keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. " }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual benefit statement to shareholders, latest publicly posted or free on request; third-party assessment required. Timing refers to ordinary report statute, now biennial, creating a timing cross-reference to check. No state benefit-report filing specified. The current 2026 text still says no less than annually in 17-72a06(b), while subsection (c) links timing to the annual report under 17-7503; section 17-7503 now governs biennial information reports. The annual benefit-statement duty remains explicit, but the cross-reference does not give a clear intervening-year delivery date. A company should set an annual shareholder/publication date and confirm that timing with counsel rather than reduce the benefit report to biennial. Assessment rule: Annual statement must assess benefit performance against independent transparent third-party standard. Third-party certification may be required by articles/bylaws; not statutory default.", "difference": "Kansas: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $45 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation operating in Kansas with no Kansas taxable income after adjustments and apportionment: $0 ordinary income tax and no franchise minimum. Excludes information-report fees and other operating taxes.", "difference": "Kansas has a compared recurring floor of $45 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: ordinary majority of outstanding entitled stock (charter amendment). Prior benefit-specific 17-72a03 was repealed in 2023. Entry/exit by charter amendment now uses ordinary board approval and majority of outstanding stock entitled to vote, plus majority of each class separately entitled to vote. Class votes and greater charter thresholds may apply; other transaction routes retain their own rules. Changing back: ordinary majority of outstanding entitled stock (charter amendment)", "difference": "Kansas entry uses ordinary majority of outstanding entitled stock (charter amendment); exit uses ordinary majority of outstanding entitled stock (charter amendment). Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Must balance stockholder pecuniary interests, materially affected interests and chosen benefits; informed/disinterested/rational-decision safe harbor. Since 2023, stockholding alone is not conflict and disinterested balancing failure is not bad faith/loyalty breach unless articles opt out. Disclosure: Annual benefit statement to shareholders, latest publicly posted or free on request; third-party assessment required. Timing refers to ordinary report statute, now biennial, creating a timing cross-reference to check. No state benefit-report filing specified. The current 2026 text still says no less than annually in 17-72a06(b), while subsection (c) links timing to the annual report under 17-7503; section 17-7503 now governs biennial information reports. The annual benefit-statement duty remains explicit, but the cross-reference does not give a clear intervening-year delivery date. A company should set an annual shareholder/publication date and confirm that timing with counsel rather than reduce the benefit report to biennial. Enforcement: Any individual/derivative/other action enforcing balancing requires at filing 2% total outstanding or listed lesser 2%/$2m; other derivative rules remain.", "difference": "Kansas requires public access to the report. Three-interest balancing combined with mandatory public annual third-party report; not the same reporting regime as Delaware/Texas." } } }, "guideUrl": "/assets/state-guides/KS.md" }, { "state": "Kentucky", "abbreviation": "KY", "form": "Public benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "Specific-benefit three-interest balancing; 90% entry", "features": { "purpose": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45776", "section": "KRS 271B.1-400" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45778", "section": "KRS 271B.2-020" } ], "confidence": "high", "generalRequired": false, "specificRequired": true, "specificOptional": false, "summary": "Responsible/sustainable PBC must identify one or more specific public benefits; no mandatory broad general-benefit purpose." }, "board": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45781", "section": "KRS 271B.8-300" } ], "confidence": "high", "mode": "three_interest_balancing", "summary": "Mandatory three-interest balance, no beneficiary duty; charter may opt in to treating disinterested balancing failures as neither bad faith nor loyalty breach." }, "standard": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45783", "section": "KRS 271B.16-210" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45783", "section": "KRS 271B.16-210" } ], "confidence": "high", "required": false, "summary": "Optional through articles/bylaws. Optional through articles/bylaws.", "thirdPartyRequired": false, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45783", "section": "KRS 271B.16-210" } ], "confidence": "high", "required": false, "summary": "Optional through articles/bylaws." }, "report": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45783", "section": "KRS 271B.16-210" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": false, "stateFiling": false, "summary": "Annual statement to shareholders with objectives, standards, factual information and assessment. Public availability/third-party standard/certification optional; no state benefit-report filing specified." }, "enforcement": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45780", "section": "KRS 271B.7-400" } ], "confidence": "high", "threshold": "2% total at filing; listed alternative $2m", "summary": "Shareholder derivative balancing suit requires 2% outstanding total, or listed lesser 2%/$2m, at institution; ordinary demand/ownership rules apply." }, "benefitLiability": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45781", "section": "KRS 271B.8-300" } ], "confidence": "high", "company": false, "directors": false, "officers": false, "summary": "No blanket corporate/director/officer benefit-failure monetary bar in the benefit-specific provisions. Charter may protect disinterested balancing failure; automatic ordinary director liability rule requires willful misconduct or wanton/reckless disregard, proved clearly and convincingly." }, "ordinaryExculpation": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45778", "section": "KRS 271B.2-020" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45781", "section": "KRS 271B.8-300" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=13395", "section": "KRS 271B.8-420(5),(6): officer liability standard and proof" } ], "confidence": "high", "director": true, "officer": true, "optIn": true, "automaticSupplementalProtection": true, "automaticSupplementalProtectionNote": "KRS 271B.8-300(5),(6) and 271B.8-420(5),(6) automatically protect directors and officers respectively; no charter election is required for those standards. The optional KRS 271B.2-020 charter provision covers directors only.", "charterDirector": true, "charterOfficer": false, "automaticDirectorProtection": true, "automaticOfficerProtection": true, "summary": "Optional charter exculpation is director-only and excludes conflicting financial interest, bad faith/intentional misconduct/knowing illegality, unlawful distributions and improper benefit. Separately, directors AND officers automatically receive a statutory liability threshold: duty breach must be shown; monetary damages also require willful misconduct or wanton/reckless disregard of corporate/shareholder interests. Breach, culpability and legal causation require clear-and-convincing proof. Injunctive relief is not eliminated. optIn refers only to the additional director charter provision.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45777", "section": "KRS 271B.11-025" } ], "confidence": "high", "entry": "90% each class", "exit": "2/3 each class", "lock": "90% entry only", "summary": "90% of every outstanding class, voting/nonvoting, to enter PBC after stock payment; 2/3 every class to exit or covered nonbenefit merger. Dissent/appraisal rights for entry.", "exitVote": "2/3 each class", "entryVote": "90% each class" } }, "costs": { "regularReport": { "sources": [ { "url": "https://www.sos.ky.gov/bus/business-filings/Pages/Annual-Reports.aspx", "section": "Annual Reports" } ], "confidence": "high", "amount": 15, "cadence": "annual", "online": 15, "paper": 15, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Ordinary annual report $15.", "conditions": "Ordinary annual report $15." }, "benefitReport": { "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45783", "section": "KRS 271B.16-210" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entity-Tax/Pages/default.aspx/1000", "section": "LLET minimum tax" }, { "label": "Kentucky DOR: corporation income tax and LLET rates and computation", "url": "https://revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entity-Tax/Pages/default.aspx", "checked": "2026-10-11", "section": "Kentucky DOR: corporation income tax and LLET rates and computation" }, { "label": "Kentucky DOR: corporation, LLC and pass-through tax FAQ", "url": "https://revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entity-Tax/Pages/Corporation-LLC-Pass-Through-Tax-FAQs.aspx", "checked": "2026-10-11", "section": "Kentucky DOR: corporation, LLC and pass-through tax FAQ" } ], "confidence": "high", "amount": 175, "cadence": "annual", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Kentucky LLET minimum generally $175 for taxable corporations doing business in Kentucky; credits/exemptions/nexus and larger receipts/profits can change obligation. Corporation income tax is separate.", "conditions": "Kentucky LLET minimum generally $175 for taxable corporations doing business in Kentucky; credits/exemptions/nexus and larger receipts/profits can change obligation. Corporation income tax is separate." } }, "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45776", "section": "KRS 271B.1-400" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45778", "section": "KRS 271B.2-020" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45781", "section": "KRS 271B.8-300" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45783", "section": "KRS 271B.16-210" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45780", "section": "KRS 271B.7-400" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=13395", "section": "KRS 271B.8-420(5),(6): officer liability standard and proof" }, { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45777", "section": "KRS 271B.11-025" }, { "url": "https://www.sos.ky.gov/bus/business-filings/Pages/Annual-Reports.aspx", "section": "Annual Reports" }, { "url": "https://revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entity-Tax/Pages/default.aspx/1000", "section": "LLET minimum tax" }, { "label": "Kentucky DOR: corporation income tax and LLET rates and computation", "url": "https://revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entity-Tax/Pages/default.aspx", "checked": "2026-10-11", "section": "Kentucky DOR: corporation income tax and LLET rates and computation" }, { "label": "Kentucky DOR: corporation, LLC and pass-through tax FAQ", "url": "https://revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entity-Tax/Pages/Corporation-LLC-Pass-Through-Tax-FAQs.aspx", "checked": "2026-10-11", "section": "Kentucky DOR: corporation, LLC and pass-through tax FAQ" } ], "differences": [ "90% entry versus 2/3 exit.", "Automatic ordinary director damages threshold includes clear-and-convincing proof.", "Annual shareholder-only benefit report is default; public/third-party optional." ], "gaps": [ "LLET requires entity/nexus-specific calculation; minimum is not a universal all-in annual cost." ], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Public benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Kentucky offers Public benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 17, 17 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Kentucky has an identified director monetary-protection provision in the compared scope, which earns this credit. Optional charter exculpation is director-only and excludes conflicting financial interest, bad faith/intentional misconduct/knowing illegality, unlawful distributions and improper benefit. Separately, directors AND officers automatically receive a statutory liability threshold: duty breach must be shown; monetary damages also require willful misconduct or wanton/reckless disregard of corporate/shareholder interests. Breach, culpability and legal causation require clear-and-convincing proof. Injunctive relief is not eliminated. optIn refers only to the additional director charter provision.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Kentucky extends ordinary protection to officers, which earns officer-scope credit. Optional charter exculpation is director-only and excludes conflicting financial interest, bad faith/intentional misconduct/knowing illegality, unlawful distributions and improper benefit. Separately, directors AND officers automatically receive a statutory liability threshold: duty breach must be shown; monetary damages also require willful misconduct or wanton/reckless disregard of corporate/shareholder interests. Breach, culpability and legal causation require clear-and-convincing proof. Injunctive relief is not eliminated. optIn refers only to the additional director charter provision.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 3, 3 ], "reason": "Statutory coverage in the selected scope receives the 3-point default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Kentucky has a default statutory liability rule in the compared scope, so it earns the automatic-coverage credit. Articles and retained exceptions still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit decision / classification safe harbor", "range": [ 2, 2 ], "reason": "2 points instead of the separate company/director/officer outcome-bar credits. The cited safe harbor is not treated as a blanket mission-failure damages bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection for benefit decisions", "why": "Kentucky protects certain properly made or classified benefit decisions. This is narrower than an express company/director/officer bar on damages merely for missing the mission, so only the narrower safe-harbor credit applies. No blanket corporate/director/officer benefit-failure monetary bar in the benefit-specific provisions. Charter may protect disinterested balancing failure; automatic ordinary director liability rule requires willful misconduct or wanton/reckless disregard, proved clearly and convincingly.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Kentucky: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Kentucky: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Kentucky: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Kentucky has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 9, 9 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 9, 9 ], "reason": "Ordinary reporting $15 + benefit filing $0 = $15 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Kentucky has a compared recurring floor of $190 per year, including $175 in identified minimum tax/license charges. Small active domestic C corporation in a regular year, no taxable profit and total gross receipts or gross profits at or below $3 million, with no special statutory exemption or incentive credit assumed. Annual registry reporting is separate. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 8, 8 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 2, 2 ], "reason": "90% of every outstanding class, voting/nonvoting, to enter PBC after stock payment; 2/3 every class to exit or covered nonbenefit merger. Dissent/appraisal rights for entry.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Kentucky: becoming a benefit company requires 90% each class. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. 90% of every outstanding class, voting/nonvoting, to enter PBC after stock payment; 2/3 every class to exit or covered nonbenefit merger. Dissent/appraisal rights for entry.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Kentucky: changing back requires 2/3 each class. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. 90% of every outstanding class, voting/nonvoting, to enter PBC after stock payment; 2/3 every class to exit or covered nonbenefit merger. Dissent/appraisal rights for entry.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 9, 9 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No statutory public benefit-report access mandate: 0 points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Kentucky has no mandatory public access in the compared variant, so it gets no public-access credit. Voluntary publication is still possible. Annual statement to shareholders with objectives, standards, factual information and assessment. Public availability/third-party standard/certification optional; no state benefit-report filing specified.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Kentucky: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Kentucky: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Kentucky makes a mission duty mandatory, so it earns this credit. Mandatory three-interest balance, no beneficiary duty; charter may opt in to treating disinterested balancing failures as neither bad faith nor loyalty breach.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 15, "ordinaryScope": { "director": true, "officer": true, "automatic": true }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 190, "minimumTaxAnnualized": 175, "entryCategory": "ninety" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 71, 71 ], "tax": { "code": "KY", "incomeSummary": "Kentucky corporate income tax is a flat 5% for tax years beginning on or after January 1, 2018, on Kentucky taxable net income after state modifications, apportionment and losses. Ordinary multistate businesses generally use a receipts factor; industry rules differ.", "recurringSummary": "The Limited Liability Entity Tax (LLET) is separate from income tax. The small-business rule leaves a $175 minimum when total gross receipts or gross profits are $3 million or less. Above the phaseout range, tax is the smaller of 0.095% of Kentucky gross receipts or 0.75% of Kentucky gross profits, never below the ordinary minimum; income tax generally credits LLET above $175.", "formationAnnualTaxFloor": 175, "floorBasis": "Ordinary nonexempt domestic corporation with limited liability: Kentucky organization creates a tax filing obligation, including a short registration year. The figure excludes the annual report and operating taxes. Statutory exempt entities, credits and special classifications need separate review.", "scenarioMinimum": 175, "scenarioBasis": "Small active domestic C corporation in a regular year, no taxable profit and total gross receipts or gross profits at or below $3 million, with no special statutory exemption or incentive credit assumed. Annual registry reporting is separate.", "operatingTaxCaution": "The DOR FAQ distinguishes domestic organization from mere name reservation and from a foreign registration with no actual Kentucky activity. Kentucky receipts determine the operating LLET base while everywhere receipts/profits control the small-business threshold; the income-tax and LLET nexus protections are not identical.", "sources": [ { "label": "Kentucky DOR: corporation income tax and LLET rates and computation", "url": "https://revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entity-Tax/Pages/default.aspx", "checked": "2026-10-11", "section": "Kentucky DOR: corporation income tax and LLET rates and computation" }, { "label": "Kentucky DOR: corporation, LLC and pass-through tax FAQ", "url": "https://revenue.ky.gov/Business/Corporation-Income-and-Limited-Liability-Entity-Tax/Pages/Corporation-LLC-Pass-Through-Tax-FAQs.aspx", "checked": "2026-10-11", "section": "Kentucky DOR: corporation, LLC and pass-through tax FAQ" } ] }, "conversion": { "state": "Kentucky", "code": "KY", "form": "Public benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "90% each class", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "90% of every outstanding class, voting/nonvoting, to enter PBC after stock payment; 2/3 every class to exit or covered nonbenefit merger. Dissent/appraisal rights for entry.", "proposal": "Address the 90% entry rule and entry-specific appraisal together; keep existing economic and contractual rights visible.", "sources": [ { "url": "https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=45777", "section": "KRS 271B.11-025" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Responsible/sustainable PBC must identify one or more specific public benefits; no mandatory broad general-benefit purpose.", "difference": "Kentucky offers Public benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Optional charter exculpation is director-only and excludes conflicting financial interest, bad faith/intentional misconduct/knowing illegality, unlawful distributions and improper benefit. Separately, directors AND officers automatically receive a statutory liability threshold: duty breach must be shown; monetary damages also require willful misconduct or wanton/reckless disregard of corporate/shareholder interests. Breach, culpability and legal causation require clear-and-convincing proof. Injunctive relief is not eliminated. optIn refers only to the additional director charter provision. Benefit-specific rule: No blanket corporate/director/officer benefit-failure monetary bar in the benefit-specific provisions. Charter may protect disinterested balancing failure; automatic ordinary director liability rule requires willful misconduct or wanton/reckless disregard, proved clearly and convincingly.", "difference": "Kentucky adds ordinary officer coverage and a default statutory liability rule. Automatic ordinary director damages threshold includes clear-and-convincing proof." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual statement to shareholders with objectives, standards, factual information and assessment. Public availability/third-party standard/certification optional; no state benefit-report filing specified. Assessment rule: Optional through articles/bylaws. Optional through articles/bylaws.", "difference": "Kentucky: Annual; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $15 per year on an annualized basis. Minimum tax/license used here: $175. Small active domestic C corporation in a regular year, no taxable profit and total gross receipts or gross profits at or below $3 million, with no special statutory exemption or incentive credit assumed. Annual registry reporting is separate.", "difference": "Kentucky has a compared recurring floor of $190 per year, including $175 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 90% each class. 90% of every outstanding class, voting/nonvoting, to enter PBC after stock payment; 2/3 every class to exit or covered nonbenefit merger. Dissent/appraisal rights for entry. Changing back: 2/3 each class", "difference": "Kentucky entry uses 90% each class; exit uses 2/3 each class. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory three-interest balance, no beneficiary duty; charter may opt in to treating disinterested balancing failures as neither bad faith nor loyalty breach. Disclosure: Annual statement to shareholders with objectives, standards, factual information and assessment. Public availability/third-party standard/certification optional; no state benefit-report filing specified. Enforcement: Shareholder derivative balancing suit requires 2% outstanding total, or listed lesser 2%/$2m, at institution; ordinary demand/ownership rules apply.", "difference": "Kentucky does not require public access in this compared variant. Automatic ordinary director damages threshold includes clear-and-convincing proof. Annual shareholder-only benefit report is default; public/third-party optional." } } }, "guideUrl": "/assets/state-guides/KY.md" }, { "state": "Louisiana", "abbreviation": "LA", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit mandatory stakeholder model; present-and-voting status denominator", "features": { "purpose": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814565", "section": "La. R.S. 12:1811" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814562", "section": "La. R.S. 12:1803" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814563", "section": "La. R.S. 12:1804(D)" } ], "confidence": "high", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "Mandatory general benefit plus optional specific benefits. Specific-benefit statutory list includes historic preservation and urban beautification. Corporate name must end with \"A Benefit Corporation\", optionally in parentheses." }, "board": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814566", "section": "La. R.S. 12:1821" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814567", "section": "La. R.S. 12:1822(A)-(F): benefit director" } ], "confidence": "high", "mode": "mandatory_stakeholder_consideration", "benefitDirectorRequired": true, "benefitDirectorIndependent": true, "summary": "Directors shall consider listed stakeholders; no priority required except as articles provide. Every benefit corporation board must include an independent individual benefit director (who may also serve as benefit officer); a professional corporation benefit director need not be independent. The benefit director issues an annual opinion on mission and duty compliance; any retained audit is optional." }, "standard": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814573", "section": "La. R.S. 12:1831" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814573", "section": "La. R.S. 12:1831(A)(4)" } ], "confidence": "high", "required": true, "summary": "Annual social/environmental assessment against third-party standard required. Report/assessment need not be audited or certified by standard provider.", "thirdPartyRequired": true, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814573", "section": "La. R.S. 12:1831(A)(4)" } ], "confidence": "high", "required": false, "summary": "Report/assessment need not be audited or certified by standard provider." }, "report": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814573", "section": "La. R.S. 12:1831" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "summary": "Annual shareholder report within 120 days or with ordinary shareholder annual report; all reports public website/latest free copy if no website. Compensation/proprietary info redactable. 5% shareholder names included. No state benefit filing specified." }, "enforcement": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814572", "section": "La. R.S. 12:1825" } ], "confidence": "high", "threshold": "any_shareholder", "summary": "Corporation directly; derivative any shareholder, benefit director (not generic any director in this section), or charter/bylaw designee. No percentage threshold." }, "benefitLiability": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814566", "section": "La. R.S. 12:1821" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814569", "section": "La. R.S. 12:1824(C)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814572", "section": "La. R.S. 12:1825" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814567", "section": "La. R.S. 12:1822(E)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814568", "section": "La. R.S. 12:1823(C): officer protection" } ], "confidence": "high", "company": false, "directors": true, "officers": true, "summary": "Directors and officers have benefit-failure monetary protection and compliant-conduct protection. No express blanket company monetary bar identified in 12:1825; ordinary automatic director/officer protection is separate. The benefit director has additional liability protection except self-dealing, willful misconduct or knowing violation of law (12:1822(E)); this narrower exception-based protection does not excuse illegality." }, "ordinaryExculpation": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=920326", "section": "La. R.S. 12:1-832" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=920205", "section": "La. R.S. 12:1-202" } ], "confidence": "high", "director": true, "officer": true, "optIn": false, "summary": "Automatic directors AND officers monetary exculpation against corporation/shareholders unless charter rejects/limits. Exceptions loyalty, intentional harm, unlawful distributions, intentional criminal violation; loyalty excludes care duties.", "automatic": true }, "statusChange": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814562", "section": "La. R.S. 12:1803(A)(9)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814563", "section": "La. R.S. 12:1804" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814564", "section": "La. R.S. 12:1805" } ], "confidence": "high", "entry": "2/3 present and voting per class/series", "exit": "2/3 present and voting per class/series", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "Benefit-law minimum vote for corporate entry/exit is 2/3 of shares PRESENT AND VOTING per class/series, plus other ordinary/article approvals; not 2/3 all outstanding shares.", "exitVote": "2/3 present and voting per class/series", "entryVote": "2/3 present and voting per class/series" } }, "costs": { "regularReport": { "sources": [ { "url": "https://www.sos.la.gov/business-services/forms-fee-schedule", "section": "Annual Report: Corporations" } ], "confidence": "high", "amount": 35, "cadence": "annual", "online": 35, "paper": 35, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Current Secretary of State schedule lists domestic/foreign corporate annual report $35.", "conditions": "Current Secretary of State schedule lists domestic/foreign corporate annual report $35." }, "benefitReport": { "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814573", "section": "La. R.S. 12:1831" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://revenue.louisiana.gov/tax-education-and-faqs/faqs/income-tax-reform/is-the-corporation-franchise-tax-repealed/", "section": "Louisiana Department of Revenue: corporation franchise-tax repeal effective January 1, 2026" }, { "label": "Louisiana DOR: current corporation tax guidance, updated July 7, 2026", "url": "https://revenue.louisiana.gov/businesses/widely-used-tax-types/corporate-income-franchise-tax/", "checked": "2026-10-11", "section": "Louisiana DOR: current corporation tax guidance, updated July 7, 2026" }, { "label": "Louisiana DOR: franchise tax repeal effective January 1, 2026", "url": "https://revenue.louisiana.gov/tax-education-and-faqs/faqs/income-tax-reform/is-the-corporation-franchise-tax-repealed/", "checked": "2026-10-11", "section": "Louisiana DOR: franchise tax repeal effective January 1, 2026" }, { "label": "Louisiana Legislature: corporate-income allocation and apportionment", "url": "https://legis.la.gov/legis/Law.aspx?d=101753", "checked": "2026-10-11", "section": "Louisiana Legislature: corporate-income allocation and apportionment" } ], "confidence": "high", "amount": 0, "cadence": "repealed for periods beginning on or after January 1, 2026", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Louisiana corporation franchise tax is repealed for tax periods beginning on or after January 1, 2026. The former franchise-tax minimum therefore does not apply to those periods. Corporate income tax and other operating taxes remain separate obligations; this is not a zero-total-tax claim.", "conditions": "Louisiana corporation franchise tax is repealed for tax periods beginning on or after January 1, 2026. The former franchise-tax minimum therefore does not apply to those periods. Corporate income tax and other operating taxes remain separate obligations; this is not a zero-total-tax claim." } }, "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814565", "section": "La. R.S. 12:1811" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814562", "section": "La. R.S. 12:1803" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814563", "section": "La. R.S. 12:1804(D)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814566", "section": "La. R.S. 12:1821" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814567", "section": "La. R.S. 12:1822(A)-(F): benefit director" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814573", "section": "La. R.S. 12:1831" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814573", "section": "La. R.S. 12:1831(A)(4)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814572", "section": "La. R.S. 12:1825" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814569", "section": "La. R.S. 12:1824(C)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814567", "section": "La. R.S. 12:1822(E)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814568", "section": "La. R.S. 12:1823(C): officer protection" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=920326", "section": "La. R.S. 12:1-832" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=920205", "section": "La. R.S. 12:1-202" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814562", "section": "La. R.S. 12:1803(A)(9)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814563", "section": "La. R.S. 12:1804" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814564", "section": "La. R.S. 12:1805" }, { "url": "https://www.sos.la.gov/business-services/forms-fee-schedule", "section": "Annual Report: Corporations" }, { "url": "https://revenue.louisiana.gov/tax-education-and-faqs/faqs/income-tax-reform/is-the-corporation-franchise-tax-repealed/", "section": "Louisiana Department of Revenue: corporation franchise-tax repeal effective January 1, 2026" }, { "label": "Louisiana DOR: current corporation tax guidance, updated July 7, 2026", "url": "https://revenue.louisiana.gov/businesses/widely-used-tax-types/corporate-income-franchise-tax/", "checked": "2026-10-11", "section": "Louisiana DOR: current corporation tax guidance, updated July 7, 2026" }, { "label": "Louisiana DOR: franchise tax repeal effective January 1, 2026", "url": "https://revenue.louisiana.gov/tax-education-and-faqs/faqs/income-tax-reform/is-the-corporation-franchise-tax-repealed/", "checked": "2026-10-11", "section": "Louisiana DOR: franchise tax repeal effective January 1, 2026" }, { "label": "Louisiana Legislature: corporate-income allocation and apportionment", "url": "https://legis.la.gov/legis/Law.aspx?d=101753", "checked": "2026-10-11", "section": "Louisiana Legislature: corporate-income allocation and apportionment" } ], "differences": [ "Status vote denominator is present-and-voting, unlike outstanding-share models.", "Automatic ordinary officer as well as director exculpation.", "Public benefit report discloses 5% owners.", "Benefit enforcement names benefit director, not every director.", "Corporate name must end with \"A Benefit Corporation\", optionally in parentheses.", "Every board must have a benefit director; independence is excused for professional corporations.", "Corporation franchise tax repealed for periods beginning on or after January 1, 2026." ], "gaps": [ "Benefit statute retains references to pre-2015 corporate-law sections; interaction with 2015 Business Corporation Act should be confirmed in drafting." ], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Louisiana offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 23, 23 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Louisiana has an identified director monetary-protection provision in the compared scope, which earns this credit. Automatic directors AND officers monetary exculpation against corporation/shareholders unless charter rejects/limits. Exceptions loyalty, intentional harm, unlawful distributions, intentional criminal violation; loyalty excludes care duties.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Louisiana extends ordinary protection to officers, which earns officer-scope credit. Automatic directors AND officers monetary exculpation against corporation/shareholders unless charter rejects/limits. Exceptions loyalty, intentional harm, unlawful distributions, intentional criminal violation; loyalty excludes care duties.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 3, 3 ], "reason": "Statutory coverage in the selected scope receives the 3-point default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Louisiana has a default statutory liability rule in the compared scope, so it earns the automatic-coverage credit. Articles and retained exceptions still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Louisiana has no separately credited benefit-specific monetary shield for company. Directors and officers have benefit-failure monetary protection and compliant-conduct protection. No express blanket company monetary bar identified in 12:1825; ordinary automatic director/officer protection is separate. The benefit director has additional liability protection except self-dealing, willful misconduct or knowing violation of law (12:1822(E)); this narrower exception-based protection does not excuse illegality.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Louisiana earns the benefit-specific credit for directors. Directors and officers have benefit-failure monetary protection and compliant-conduct protection. No express blanket company monetary bar identified in 12:1825; ordinary automatic director/officer protection is separate. The benefit director has additional liability protection except self-dealing, willful misconduct or knowing violation of law (12:1822(E)); this narrower exception-based protection does not excuse illegality.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Louisiana earns the benefit-specific credit for officers. Directors and officers have benefit-failure monetary protection and compliant-conduct protection. No express blanket company monetary bar identified in 12:1825; ordinary automatic director/officer protection is separate. The benefit director has additional liability protection except self-dealing, willful misconduct or knowing violation of law (12:1822(E)); this narrower exception-based protection does not excuse illegality.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 12, 12 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Louisiana: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Louisiana: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Louisiana: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "Mandatory benefit director or report-approval procedure in this private-company scope: no 3-point flexibility bonus.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Louisiana requires an additional benefit-director or report-approval procedure in this private-company scope, so it receives no no-extra-step credit. Directors shall consider listed stakeholders; no priority required except as articles provide. Every benefit corporation board must include an independent individual benefit director (who may also serve as benefit officer); a professional corporation benefit director need not be independent. The benefit director issues an annual opinion on mission and duty compliance; any retained audit is optional.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $35 + benefit filing $0 = $35 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Louisiana has a compared recurring floor of $35 per year, including $0 in identified minimum tax/license charges. Ordinary small active domestic C corporation, regular taxable period beginning in 2026, no Louisiana taxable profit after state adjustments. The repealed franchise charge contributes $0; annual-report fees and other operating taxes remain outside the figure. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Benefit-law minimum vote for corporate entry/exit is 2/3 of shares PRESENT AND VOTING per class/series, plus other ordinary/article approvals; not 2/3 all outstanding shares.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Louisiana: becoming a benefit company requires 2/3 present and voting per class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Benefit-law minimum vote for corporate entry/exit is 2/3 of shares PRESENT AND VOTING per class/series, plus other ordinary/article approvals; not 2/3 all outstanding shares.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Louisiana: changing back requires 2/3 present and voting per class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Benefit-law minimum vote for corporate entry/exit is 2/3 of shares PRESENT AND VOTING per class/series, plus other ordinary/article approvals; not 2/3 all outstanding shares.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Louisiana requires report access for people outside the company, so it earns public-access credit. Annual shareholder report within 120 days or with ordinary shareholder annual report; all reports public website/latest free copy if no website. Compensation/proprietary info redactable. 5% shareholder names included. No state benefit filing specified.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Louisiana: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Louisiana: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Louisiana makes a mission duty mandatory, so it earns this credit. Directors shall consider listed stakeholders; no priority required except as articles provide. Every benefit corporation board must include an independent individual benefit director (who may also serve as benefit officer); a professional corporation benefit director need not be independent. The benefit director issues an annual opinion on mission and duty compliance; any retained audit is optional.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 35, "ordinaryScope": { "director": true, "officer": true, "automatic": true }, "exitCategory": "two_thirds", "specialProcedure": true, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 35, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 84, 84 ], "tax": { "code": "LA", "incomeSummary": "Louisiana corporation income tax is a flat 5.5% for periods beginning on or after January 1, 2025; the previous graduated brackets are repealed. State taxable income and sourcing rules still determine liability.", "recurringSummary": "The corporation franchise tax is repealed for franchise-tax periods beginning on or after January 1, 2026. Its former minimum and capital-based charge must not be carried into a 2026-period comparison. Earlier-period tax obligations and the separate corporate annual report remain.", "formationAnnualTaxFloor": null, "floorBasis": "No post-repeal fixed corporation franchise-tax floor is identified for a period beginning in 2026. The absence of that franchise tax does not establish $0 income or operating taxes. Annual registry fees, prior periods, property, sales and payroll taxes are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Ordinary small active domestic C corporation, regular taxable period beginning in 2026, no Louisiana taxable profit after state adjustments. The repealed franchise charge contributes $0; annual-report fees and other operating taxes remain outside the figure.", "operatingTaxCaution": "LDR ties corporation-income filing to corporate tax classification and Louisiana-source income. Louisiana statute section 47:287.95 supplies allocation/apportionment and activity-specific sourcing rules. State incorporation and an out-of-state charter do not substitute for analyzing the actual Louisiana business and income.", "sources": [ { "label": "Louisiana DOR: current corporation tax guidance, updated July 7, 2026", "url": "https://revenue.louisiana.gov/businesses/widely-used-tax-types/corporate-income-franchise-tax/", "checked": "2026-10-11", "section": "Louisiana DOR: current corporation tax guidance, updated July 7, 2026" }, { "label": "Louisiana DOR: franchise tax repeal effective January 1, 2026", "url": "https://revenue.louisiana.gov/tax-education-and-faqs/faqs/income-tax-reform/is-the-corporation-franchise-tax-repealed/", "checked": "2026-10-11", "section": "Louisiana DOR: franchise tax repeal effective January 1, 2026" }, { "label": "Louisiana Legislature: corporate-income allocation and apportionment", "url": "https://legis.la.gov/legis/Law.aspx?d=101753", "checked": "2026-10-11", "section": "Louisiana Legislature: corporate-income allocation and apportionment" } ] }, "conversion": { "state": "Louisiana", "code": "LA", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 present and voting per class/series", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Benefit-law minimum vote for corporate entry/exit is 2/3 of shares PRESENT AND VOTING per class/series, plus other ordinary/article approvals; not 2/3 all outstanding shares.", "proposal": "Retain the actual present-and-voting denominator in any redline; do not rewrite it as two-thirds of all outstanding shares.", "sources": [ { "url": "https://legis.la.gov/Legis/Law.aspx?d=814562", "section": "La. R.S. 12:1803(A)(9)" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814563", "section": "La. R.S. 12:1804" }, { "url": "https://legis.la.gov/Legis/Law.aspx?d=814564", "section": "La. R.S. 12:1805" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mandatory general benefit plus optional specific benefits. Specific-benefit statutory list includes historic preservation and urban beautification. Corporate name must end with \"A Benefit Corporation\", optionally in parentheses.", "difference": "Louisiana offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Automatic directors AND officers monetary exculpation against corporation/shareholders unless charter rejects/limits. Exceptions loyalty, intentional harm, unlawful distributions, intentional criminal violation; loyalty excludes care duties. Benefit-specific rule: Directors and officers have benefit-failure monetary protection and compliant-conduct protection. No express blanket company monetary bar identified in 12:1825; ordinary automatic director/officer protection is separate. The benefit director has additional liability protection except self-dealing, willful misconduct or knowing violation of law (12:1822(E)); this narrower exception-based protection does not excuse illegality.", "difference": "Louisiana adds ordinary officer coverage and a default statutory liability rule. Automatic ordinary officer as well as director exculpation. Benefit enforcement names benefit director, not every director. Every board must have a benefit director; independence is excused for professional corporations." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder report within 120 days or with ordinary shareholder annual report; all reports public website/latest free copy if no website. Compensation/proprietary info redactable. 5% shareholder names included. No state benefit filing specified. Assessment rule: Annual social/environmental assessment against third-party standard required. Report/assessment need not be audited or certified by standard provider.", "difference": "Louisiana: Annual; Required outside framework; no separate state benefit-report filing. An additional benefit-director or approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $35 per year on an annualized basis. Minimum tax/license used here: $0. Ordinary small active domestic C corporation, regular taxable period beginning in 2026, no Louisiana taxable profit after state adjustments. The repealed franchise charge contributes $0; annual-report fees and other operating taxes remain outside the figure.", "difference": "Louisiana has a compared recurring floor of $35 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 present and voting per class/series. Benefit-law minimum vote for corporate entry/exit is 2/3 of shares PRESENT AND VOTING per class/series, plus other ordinary/article approvals; not 2/3 all outstanding shares. Changing back: 2/3 present and voting per class/series", "difference": "Louisiana entry uses 2/3 present and voting per class/series; exit uses 2/3 present and voting per class/series. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors shall consider listed stakeholders; no priority required except as articles provide. Every benefit corporation board must include an independent individual benefit director (who may also serve as benefit officer); a professional corporation benefit director need not be independent. The benefit director issues an annual opinion on mission and duty compliance; any retained audit is optional. Disclosure: Annual shareholder report within 120 days or with ordinary shareholder annual report; all reports public website/latest free copy if no website. Compensation/proprietary info redactable. 5% shareholder names included. No state benefit filing specified. Enforcement: Corporation directly; derivative any shareholder, benefit director (not generic any director in this section), or charter/bylaw designee. No percentage threshold.", "difference": "Louisiana requires public access to the report. Public benefit report discloses 5% owners. Benefit enforcement names benefit director, not every director." } } }, "guideUrl": "/assets/state-guides/LA.md" }, { "state": "Maine", "abbreviation": "ME", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / mandatory-stakeholder model", "features": { "purpose": { "summary": "General public benefit required; specific charter benefits optional and cannot replace the general obligation.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1811.html", "section": "13-C \u00a71811" } ] }, "board": { "summary": "Mandatory stakeholder consideration; charter can prioritize mission. Independent benefit director required for statutory public corporations (listed/covered/Exchange Act registered securities), optional for others; professional corporations have an independence exception.", "mode": "mandatory_consider", "benefitDirectorRequired": "statutory public corporations only; professional independence exception", "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1821.html", "section": "\u00a7\u00a71821-1822" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1822.html", "section": "\u00a71822" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec102.html", "section": "\u00a7102(30-A)" } ] }, "standard": { "summary": "Annual third-party standard assessment required; external audit/certification not required.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1831.html", "section": "\u00a71831(1)-(3)" } ] }, "report": { "summary": "Annual to shareholders by earlier of 120 days or other annual report. All reports public online; free latest report on request if no website. No state benefit-report filing.", "cadence": "annual", "shareholders": true, "publicWebsite": "all annual reports", "stateFiling": false, "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1832.html", "section": "\u00a71832" } ], "public": true }, "enforcement": { "summary": "Corporation; derivative 2% of class/series collectively at challenged act, directors, 5% parent equity, and charter/bylaw designees.", "shareholderThreshold": "2% of class/series", "directorStanding": true, "parentThreshold": "5% of parent equity", "otherStanding": "charter/bylaw designees", "corporationStanding": true, "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1825.html", "section": "\u00a71825(3)" } ] }, "benefitLiability": { "summary": "Corporation mission-failure damages barred. Director/officer compliant-duty and mission-failure monetary protection applies unless charter provides otherwise. Special benefit-director immunity excludes self-dealing, wilful misconduct and knowing violations.", "corporationMissionDamagesBar": true, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1825.html", "section": "\u00a71825(2)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1821.html", "section": "\u00a71821(3)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1823.html", "section": "\u00a71823(3)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1822.html", "section": "\u00a71822(5)" } ] }, "ordinaryExculpation": { "summary": "Charter director damages exculpation excludes unentitled financial benefit, intentional harm, unlawful distributions and intentional criminal-law violation. No ordinary officer clause in \u00a7202.", "director": true, "officer": false, "automatic": false, "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec202.html", "section": "\u00a7202(2)(D)" } ] }, "statusChange": { "summary": "Entry/exit and specified transactions require two-thirds of every class/series, including otherwise nonvoting interests; no special legacy-lock provision identified.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds of each class, including nonvoting", "optionalLock": false, "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1802.html", "section": "\u00a7\u00a71802(11),1804-1805" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1804.html", "section": "\u00a71804" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1805.html", "section": "\u00a71805" } ] } }, "costs": { "regularReport": { "amount": 85, "currency": "USD", "cadence": "annual", "conditions": "Domestic business corporation; foreign corporation $150. Due June 1.", "summary": "Domestic business corporation; foreign corporation $150. Due June 1.", "sources": [ { "url": "https://www.maine.gov/sos/corporations-commissions/corporations-business-services/business-corporations", "section": "annual report" } ] }, "benefitReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No state benefit-report filing.", "summary": "No state benefit-report filing.", "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1832.html", "section": "\u00a71832" } ] }, "minimumTax": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No fixed dollar corporate-income-tax floor in the cited rate formula: the income-tax amount can be $0 when taxable Maine income is $0. C corporations with Maine nexus and Maine income pay graduated tax, starting at 3.5% through $350,000 of adjusted federal taxable income and rising to 8.93% above $3.5 million, with multistate apportionment. Maine incorporation itself establishes nexus; out-of-state companies can also cross property/payroll/sales thresholds. S corporations generally avoid this entity income tax unless they have corporate-level taxable gains. Financial-institution franchise and insurance-premium regimes are separate. The $85 annual-report fee still applies.", "basis": "Conditional $0 income-tax scenario from statutory rate formula; not a universal $0 operating-cost claim.", "summary": "No fixed dollar corporate-income-tax floor in the cited rate formula: the income-tax amount can be $0 when taxable Maine income is $0. C corporations with Maine nexus and Maine income pay graduated tax, starting at 3.5% through $350,000 of adjusted federal taxable income and rising to 8.93% above $3.5 million, with multistate apportionment. Maine incorporation itself establishes nexus; out-of-state companies can also cross property/payroll/sales thresholds. S corporations generally avoid this entity income tax unless they have corporate-level taxable gains. Financial-institution franchise and insurance-premium regimes are separate. The $85 annual-report fee still applies.", "sources": [ { "url": "https://www.maine.gov/revenue/faq/corporate-income-tax", "section": "Corporate Income Tax FAQ questions 1\u20133; nexus/filing guidance revised April 17, 2026" }, { "url": "https://www.legis.maine.gov/legis/statutes/36/title36sec5200.html", "section": "36 MRSA \u00a75200(1-A) income-based rate schedule" }, { "label": "Maine Revenue Services: rates, nexus and filing FAQ, including April 2026 updates", "url": "https://www1.maine.gov/revenue/faq/corporate-income-tax", "checked": "2026-10-11", "section": "Maine Revenue Services: rates, nexus and filing FAQ, including April 2026 updates" }, { "label": "Maine statute: corporate-income rate formula, section 5200", "url": "https://legislature.maine.gov/statutes/36/title36sec5200.html", "checked": "2026-10-11", "section": "Maine statute: corporate-income rate formula, section 5200" } ] } }, "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1811.html", "section": "13-C \u00a71811" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1821.html", "section": "\u00a7\u00a71821-1822" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1822.html", "section": "\u00a71822" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec102.html", "section": "\u00a7102(30-A)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1831.html", "section": "\u00a71831(1)-(3)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1832.html", "section": "\u00a71832" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1825.html", "section": "\u00a71825(3)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1825.html", "section": "\u00a71825(2)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1821.html", "section": "\u00a71821(3)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1823.html", "section": "\u00a71823(3)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1822.html", "section": "\u00a71822(5)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec202.html", "section": "\u00a7202(2)(D)" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1802.html", "section": "\u00a7\u00a71802(11),1804-1805" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1804.html", "section": "\u00a71804" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1805.html", "section": "\u00a71805" }, { "url": "https://www.maine.gov/sos/corporations-commissions/corporations-business-services/business-corporations", "section": "annual report" }, { "url": "https://www.maine.gov/revenue/faq/corporate-income-tax", "section": "Corporate Income Tax FAQ questions 1\u20133; nexus/filing guidance revised April 17, 2026" }, { "url": "https://www.legis.maine.gov/legis/statutes/36/title36sec5200.html", "section": "36 MRSA \u00a75200(1-A) income-based rate schedule" }, { "label": "Maine Revenue Services: rates, nexus and filing FAQ, including April 2026 updates", "url": "https://www1.maine.gov/revenue/faq/corporate-income-tax", "checked": "2026-10-11", "section": "Maine Revenue Services: rates, nexus and filing FAQ, including April 2026 updates" }, { "label": "Maine statute: corporate-income rate formula, section 5200", "url": "https://legislature.maine.gov/statutes/36/title36sec5200.html", "checked": "2026-10-11", "section": "Maine statute: corporate-income rate formula, section 5200" } ], "differences": [ "No separate independent benefit director required for a private startup.", "Charter can override some default benefit-duty damages protection.", "2% shareholder/5% parent enforcement is more accessible than Connecticut\u2019s thresholds." ], "gaps": [], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Maine offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Maine has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter director damages exculpation excludes unentitled financial benefit, intentional harm, unlawful distributions and intentional criminal-law violation. No ordinary officer clause in \u00a7202.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Maine does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Maine requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Maine earns the benefit-specific credit for company. Corporation mission-failure damages barred. Director/officer compliant-duty and mission-failure monetary protection applies unless charter provides otherwise. Special benefit-director immunity excludes self-dealing, wilful misconduct and knowing violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Maine earns the benefit-specific credit for directors. Corporation mission-failure damages barred. Director/officer compliant-duty and mission-failure monetary protection applies unless charter provides otherwise. Special benefit-director immunity excludes self-dealing, wilful misconduct and knowing violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Maine earns the benefit-specific credit for officers. Corporation mission-failure damages barred. Director/officer compliant-duty and mission-failure monetary protection applies unless charter provides otherwise. Special benefit-director immunity excludes self-dealing, wilful misconduct and knowing violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Maine: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Maine: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Maine: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Maine has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $85 + benefit filing $0 = $85 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Maine has a compared recurring floor of $85 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation in a regular year with no Maine corporate taxable income after state modifications and apportionment. Excludes the domestic annual report and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry/exit and specified transactions require two-thirds of every class/series, including otherwise nonvoting interests; no special legacy-lock provision identified.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Maine: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Maine: changing back requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Maine requires report access for people outside the company, so it earns public-access credit. Annual to shareholders by earlier of 120 days or other annual report. All reports public online; free latest report on request if no website. No state benefit-report filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Maine: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Maine: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Maine makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration; charter can prioritize mission. Independent benefit director required for statutory public corporations (listed/covered/Exchange Act registered securities), optional for others; professional corporations have an independence exception.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 85, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 85, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 76, 76 ], "tax": { "code": "ME", "incomeSummary": "Maine's graduated corporate rates are 3.5% through $350,000 of adjusted federal taxable income, 7.93% on the next amount through $1.05 million, 8.33% through $3.5 million, and 8.93% above $3.5 million. These are marginal brackets, with multistate apportionment; special financial and insurance regimes differ.", "recurringSummary": "The ordinary corporation-income rate schedule has no fixed-dollar minimum. Maine's franchise tax applies to qualifying financial institutions, not the ordinary civic-technology C corporation. The domestic annual report remains a separate registry charge.", "formationAnnualTaxFloor": null, "floorBasis": "No fixed recurring tax from mere ordinary domestic stock-corporation status is identified. Zero depends on the taxable-income calculation and is not a zero annual-cost claim; registry fees and property, sales, service-provider and payroll taxes are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation in a regular year with no Maine corporate taxable income after state modifications and apportionment. Excludes the domestic annual report and other operating taxes.", "operatingTaxCaution": "MRS's April 2026 FAQ says Maine organization or commercial domicile creates nexus. Foreign corporations can exceed $250,000 property, $250,000 payroll, $500,000 Maine sales or a 25% factor threshold, subject to applicable protections. Filing depends on nexus, Maine income and federal corporate-income classification.", "sources": [ { "label": "Maine Revenue Services: rates, nexus and filing FAQ, including April 2026 updates", "url": "https://www1.maine.gov/revenue/faq/corporate-income-tax", "checked": "2026-10-11", "section": "Maine Revenue Services: rates, nexus and filing FAQ, including April 2026 updates" }, { "label": "Maine statute: corporate-income rate formula, section 5200", "url": "https://legislature.maine.gov/statutes/36/title36sec5200.html", "checked": "2026-10-11", "section": "Maine statute: corporate-income rate formula, section 5200" } ] }, "conversion": { "state": "Maine", "code": "ME", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry/exit and specified transactions require two-thirds of every class/series, including otherwise nonvoting interests; no special legacy-lock provision identified.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1802.html", "section": "\u00a7\u00a71802(11),1804-1805" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1804.html", "section": "\u00a71804" }, { "url": "https://www.legislature.maine.gov/legis/statutes/13-C/title13-Csec1805.html", "section": "\u00a71805" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required; specific charter benefits optional and cannot replace the general obligation.", "difference": "Maine offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter director damages exculpation excludes unentitled financial benefit, intentional harm, unlawful distributions and intentional criminal-law violation. No ordinary officer clause in \u00a7202. Benefit-specific rule: Corporation mission-failure damages barred. Director/officer compliant-duty and mission-failure monetary protection applies unless charter provides otherwise. Special benefit-director immunity excludes self-dealing, wilful misconduct and knowing violations.", "difference": "Maine keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. No separate independent benefit director required for a private startup. Charter can override some default benefit-duty damages protection." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders by earlier of 120 days or other annual report. All reports public online; free latest report on request if no website. No state benefit-report filing. Assessment rule: Annual third-party standard assessment required; external audit/certification not required.", "difference": "Maine: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $85 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation in a regular year with no Maine corporate taxable income after state modifications and apportionment. Excludes the domestic annual report and other operating taxes.", "difference": "Maine has a compared recurring floor of $85 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Entry/exit and specified transactions require two-thirds of every class/series, including otherwise nonvoting interests; no special legacy-lock provision identified. Changing back: two-thirds of each class, including nonvoting", "difference": "Maine entry uses two-thirds of each class, including nonvoting; exit uses two-thirds of each class, including nonvoting. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration; charter can prioritize mission. Independent benefit director required for statutory public corporations (listed/covered/Exchange Act registered securities), optional for others; professional corporations have an independence exception. Disclosure: Annual to shareholders by earlier of 120 days or other annual report. All reports public online; free latest report on request if no website. No state benefit-report filing. Enforcement: Corporation; derivative 2% of class/series collectively at challenged act, directors, 5% parent equity, and charter/bylaw designees.", "difference": "Maine requires public access to the report. 2% shareholder/5% parent enforcement is more accessible than Connecticut\u2019s thresholds." } } }, "guideUrl": "/assets/state-guides/ME.md" }, { "state": "Maryland", "abbreviation": "MD", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / ordinary-corporate-enforcement model", "features": { "purpose": { "summary": "General public benefit required; identified specific charter benefits optional.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-06", "section": "\u00a75-6C-06" } ] }, "board": { "summary": "Directors must consider shareholders, employees/suppliers, customers, community/society and environment; beneficiaries gain no director duty merely from that status. No separate benefit director mandated.", "mode": "mandatory_consider", "benefitDirectorRequired": "none", "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-07", "section": "\u00a75-6C-07" } ] }, "standard": { "summary": "Annual social/environmental assessment against third-party standard required. Subtitle has no mandatory third-party audit or certification.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-08", "section": "\u00a75-6C-08(a)" } ] }, "report": { "summary": "Annual to each shareholder within 120 days. Latest report public online or free on demand without a website. No state benefit-report filing in subtitle.", "cadence": "annual", "shareholders": true, "publicWebsite": "most recent report", "stateFiling": false, "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-08", "section": "\u00a75-6C-08" } ], "public": true }, "enforcement": { "summary": "The benefit subtitle creates no special ownership-percentage threshold or enforcement proceeding. A qualifying shareholder uses ordinary derivative remedies: plead entitlement at the challenged conduct and filing (or succession by law), adequate representation, and demand or a particularized excuse. Demand is excused only for irreparable harm from demand/delay or a board majority personally disabled from considering it under the statutory conduct standard. Potential director liability alone does not excuse demand.", "shareholderThreshold": "no special percentage floor; ordinary entitlement and representation requirements", "directorStanding": null, "parentThreshold": null, "otherStanding": "ordinary corporate remedies", "corporationStanding": null, "ownershipTiming": "Entitlement at challenged transaction/conduct and commencement, or devolution by operation of law", "demandRequired": true, "demandException": "Particularized irreparable harm from demand/delay, or personally and directly disabling conflict/commitment of a board majority", "ordinaryProcedure": "Rule 15-1601 requires fair and adequate representation. Settlement, voluntary dismissal or compromise requires either all equity holders\u2019 consent or court approval after notice and an opportunity for hearing.", "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-07", "section": "Title 5, Subtitle 6C, \u00a7\u00a701-08" }, { "url": "https://www.mdcourts.gov/sites/default/files/rules/order/ro224th.pdf", "section": "Supreme Court rules order filed June 26, 2025; Rule 15-1601(b)-(d), PDF pages 117\u2013118; effective October 1, 2025" }, { "url": "https://www.mdcourts.gov/data/opinions/coa/2026/51a25.pdf", "section": "Nathanson v. Tortoise Capital Advisors, No.51 September Term 2025, filed July 14, 2026; slip-opinion pages 19\u201324 (PDF pages 21\u201326)" } ] }, "benefitLiability": { "summary": "Reasonable compliance with director duties invokes statutory immunity; no explicit blanket corporation/officer mission-failure monetary bar in benefit subtitle.", "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false, "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-07", "section": "\u00a75-6C-07(c); Courts \u00a75-417" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gcj&enactments=false§ion=5-417", "section": "Courts \u00a75-417" } ] }, "ordinaryExculpation": { "summary": "Charter may exculpate both directors and officers against corporation/shareholder damages except actual improper benefit/profit and active deliberate dishonesty established by final judgment and material to claim. Special bank/financial-institution exceptions apply; other capacities unaffected.", "director": true, "officer": true, "automatic": false, "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gcj&enactments=false§ion=5-418", "section": "Courts \u00a75-418; Corporations \u00a72-405.2" } ] }, "statusChange": { "summary": "Entry and exit use ordinary charter-amendment vote: two-thirds of entitled votes by default; charter can raise or lower to at least majority of entitled votes. No benefit-specific all-nonvoting-class override or legacy lock.", "entryVote": "two-thirds default; charter can reduce to majority entitled votes", "exitVote": "same ordinary charter-amendment rule", "optionalLock": false, "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-03", "section": "\u00a7\u00a75-6C-03,-04;2-604(f);2-104(b)(5)" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-04", "section": "\u00a75-6C-04" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=2-604", "section": "\u00a72-604(f)" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=2-104", "section": "\u00a72-104(b)(5)" } ] } }, "costs": { "regularReport": { "amount": 300, "currency": "USD", "cadence": "annual", "conditions": "Domestic/foreign stock corporation Form 1; MarylandSaves-approved waiver can eliminate this fee; farm/nonstock/interstate exceptions differ.", "summary": "Domestic/foreign stock corporation Form 1; MarylandSaves-approved waiver can eliminate this fee; farm/nonstock/interstate exceptions differ.", "sources": [ { "url": "https://dat.maryland.gov/SiteAssets/Pages/sdatforms/2026_Form1%20Final%20%286%29.pdf", "section": "2026 Form 1 fee table" } ] }, "benefitReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No state benefit-report filing in subtitle.", "summary": "No state benefit-report filing in subtitle.", "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-08", "section": "\u00a75-6C-08" } ] }, "minimumTax": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No fixed dollar floor in the ordinary corporate-income-tax calculation: 8.25% of Maryland taxable income can produce $0 income tax when that taxable income is $0. A domestic C corporation must still file Form 500 even if inactive or without taxable income; other corporations file when subject to Maryland law with Maryland-source income or losses. Multistate income must be apportioned. S corporations follow pass-through filing and possible nonresident-member tax rules instead. This does not eliminate the separate $300 annual-report charge, an approved MarylandSaves waiver, or applicable personal-property assessments.", "basis": "Conditional $0 ordinary corporate-income-tax scenario; separate annual-report and property charges remain.", "summary": "No fixed dollar floor in the ordinary corporate-income-tax calculation: 8.25% of Maryland taxable income can produce $0 income tax when that taxable income is $0. A domestic C corporation must still file Form 500 even if inactive or without taxable income; other corporations file when subject to Maryland law with Maryland-source income or losses. Multistate income must be apportioned. S corporations follow pass-through filing and possible nonresident-member tax rules instead. This does not eliminate the separate $300 annual-report charge, an approved MarylandSaves waiver, or applicable personal-property assessments.", "sources": [ { "url": "https://services.marylandcomptroller.gov/taxes/en/business-income-tax-information?id=kb_article_view&sysparm_article=KB0010043", "section": "Corporation Income Tax; Pass-Through Entity Income Tax" }, { "url": "https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/forms/2026/500d.pdf", "section": "2026 Form 500D estimated-tax worksheet line 2: 8.25% of taxable income less credits" }, { "label": "Maryland Comptroller: corporate-income rate and domestic filing requirement", "url": "https://services.marylandcomptroller.gov/taxes/en/business-income-tax-information?id=kb_article_view&sysparm_article=KB0010043", "checked": "2026-10-11", "section": "Maryland Comptroller: corporate-income rate and domestic filing requirement" }, { "label": "Maryland Comptroller: Administrative Release 43 corporate apportionment", "url": "https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/legal-publications/administrative-releases/income-and-estate-tax/ar_it43.pdf", "checked": "2026-10-11", "section": "Maryland Comptroller: Administrative Release 43 corporate apportionment" }, { "label": "Maryland Comptroller: 2026 corporation estimated-tax worksheet", "url": "https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/forms/2026/500d.pdf", "checked": "2026-10-11", "section": "Maryland Comptroller: 2026 corporation estimated-tax worksheet" } ] } }, "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-06", "section": "\u00a75-6C-06" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-07", "section": "\u00a75-6C-07" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-08", "section": "\u00a75-6C-08(a)" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-08", "section": "\u00a75-6C-08" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-07", "section": "Title 5, Subtitle 6C, \u00a7\u00a701-08" }, { "url": "https://www.mdcourts.gov/sites/default/files/rules/order/ro224th.pdf", "section": "Supreme Court rules order filed June 26, 2025; Rule 15-1601(b)-(d), PDF pages 117\u2013118; effective October 1, 2025" }, { "url": "https://www.mdcourts.gov/data/opinions/coa/2026/51a25.pdf", "section": "Nathanson v. Tortoise Capital Advisors, No.51 September Term 2025, filed July 14, 2026; slip-opinion pages 19\u201324 (PDF pages 21\u201326)" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-07", "section": "\u00a75-6C-07(c); Courts \u00a75-417" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gcj&enactments=false§ion=5-417", "section": "Courts \u00a75-417" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gcj&enactments=false§ion=5-418", "section": "Courts \u00a75-418; Corporations \u00a72-405.2" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-03", "section": "\u00a7\u00a75-6C-03,-04;2-604(f);2-104(b)(5)" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-04", "section": "\u00a75-6C-04" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=2-604", "section": "\u00a72-604(f)" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=2-104", "section": "\u00a72-104(b)(5)" }, { "url": "https://dat.maryland.gov/SiteAssets/Pages/sdatforms/2026_Form1%20Final%20%286%29.pdf", "section": "2026 Form 1 fee table" }, { "url": "https://services.marylandcomptroller.gov/taxes/en/business-income-tax-information?id=kb_article_view&sysparm_article=KB0010043", "section": "Corporation Income Tax; Pass-Through Entity Income Tax" }, { "url": "https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/forms/2026/500d.pdf", "section": "2026 Form 500D estimated-tax worksheet line 2: 8.25% of taxable income less credits" }, { "label": "Maryland Comptroller: corporate-income rate and domestic filing requirement", "url": "https://services.marylandcomptroller.gov/taxes/en/business-income-tax-information?id=kb_article_view&sysparm_article=KB0010043", "checked": "2026-10-11", "section": "Maryland Comptroller: corporate-income rate and domestic filing requirement" }, { "label": "Maryland Comptroller: Administrative Release 43 corporate apportionment", "url": "https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/legal-publications/administrative-releases/income-and-estate-tax/ar_it43.pdf", "checked": "2026-10-11", "section": "Maryland Comptroller: Administrative Release 43 corporate apportionment" }, { "label": "Maryland Comptroller: 2026 corporation estimated-tax worksheet", "url": "https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/forms/2026/500d.pdf", "checked": "2026-10-11", "section": "Maryland Comptroller: 2026 corporation estimated-tax worksheet" } ], "differences": [ "Both directors and officers can receive broad ordinary charter protection, with deliberate-dishonesty and improper-benefit exceptions.", "Ordinary amendment vote can be reduced to majority; no automatic two-thirds vote for every nonvoting class.", "No designated benefit director or bespoke benefit-enforcement threshold.", "Demand is ordinarily required before a shareholder derivative suit; futility is narrowly limited and requires particularized facts." ], "gaps": [], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "Ordinary enforcement is described using Rule 15-1601, effective October 1, 2025, and the Supreme Court\u2019s July 14, 2026 Nathanson clarification. These procedural rules do not themselves establish that a particular benefit-related allegation states a valid corporate claim.", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Maryland offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 12, 12 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Maryland has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter may exculpate both directors and officers against corporation/shareholder damages except actual improper benefit/profit and active deliberate dishonesty established by final judgment and material to claim. Special bank/financial-institution exceptions apply; other capacities unaffected.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Maryland extends ordinary protection to officers, which earns officer-scope credit. Charter may exculpate both directors and officers against corporation/shareholder damages except actual improper benefit/profit and active deliberate dishonesty established by final judgment and material to claim. Special bank/financial-institution exceptions apply; other capacities unaffected.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Maryland requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Maryland has no separately credited benefit-specific monetary shield for company. Reasonable compliance with director duties invokes statutory immunity; no explicit blanket corporation/officer mission-failure monetary bar in benefit subtitle.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Maryland has no separately credited benefit-specific monetary shield for directors. Reasonable compliance with director duties invokes statutory immunity; no explicit blanket corporation/officer mission-failure monetary bar in benefit subtitle.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Maryland has no separately credited benefit-specific monetary shield for officers. Reasonable compliance with director duties invokes statutory immunity; no explicit blanket corporation/officer mission-failure monetary bar in benefit subtitle.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Maryland: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Maryland: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Maryland: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Maryland has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 6, 6 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 6, 6 ], "reason": "Ordinary reporting $300 + benefit filing $0 = $300 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Maryland has a compared recurring floor of $300 per year, including $0 in identified minimum tax/license charges. Small active domestic C corporation in a regular year with no Maryland taxable income after state modifications and apportionment. Form 500 remains required. SDAT annual-report and personal-property costs are excluded and must be evaluated separately. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry and exit use ordinary charter-amendment vote: two-thirds of entitled votes by default; charter can raise or lower to at least majority of entitled votes. No benefit-specific all-nonvoting-class override or legacy lock.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Maryland: becoming a benefit company requires two-thirds default; charter can reduce to majority entitled votes. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Entry and exit use ordinary charter-amendment vote: two-thirds of entitled votes by default; charter can raise or lower to at least majority of entitled votes. No benefit-specific all-nonvoting-class override or legacy lock.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "No added benefit-status supermajority: 10 points. Ordinary transaction votes and any higher charter votes still apply. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Maryland: changing back requires same ordinary charter-amendment rule. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Entry and exit use ordinary charter-amendment vote: two-thirds of entitled votes by default; charter can raise or lower to at least majority of entitled votes. No benefit-specific all-nonvoting-class override or legacy lock.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Maryland requires report access for people outside the company, so it earns public-access credit. Annual to each shareholder within 120 days. Latest report public online or free on demand without a website. No state benefit-report filing in subtitle.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Maryland: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Maryland: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Maryland makes a mission duty mandatory, so it earns this credit. Directors must consider shareholders, employees/suppliers, customers, community/society and environment; beneficiaries gain no director duty merely from that status. No separate benefit director mandated.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 300, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 300, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Ordinary transaction votes" }, "scoreRange": [ 66, 66 ], "tax": { "code": "MD", "incomeSummary": "Maryland corporation income tax is 8.25% of Maryland taxable income, beginning with federal taxable income and state modifications. Ordinary multistate corporations generally use single-sales-factor apportionment for tax years after 2021; specified industries and approved alternative methods differ.", "recurringSummary": "The ordinary corporate-income formula has no fixed-dollar income-tax minimum. The separate SDAT annual-report charge, potential MarylandSaves waiver and taxable business personal property remain outside that income-tax calculation.", "formationAnnualTaxFloor": null, "floorBasis": "No unconditional domestic-corporation tax floor is identified in the cited income-tax formula. A $0 calculation requires no Maryland taxable income and does not waive the domestic filing obligation, annual-report fee or property assessments.", "scenarioMinimum": 0, "scenarioBasis": "Small active domestic C corporation in a regular year with no Maryland taxable income after state modifications and apportionment. Form 500 remains required. SDAT annual-report and personal-property costs are excluded and must be evaluated separately.", "operatingTaxCaution": "Comptroller guidance requires every Maryland corporation to file even when inactive or without taxable income, and other subject corporations with Maryland-source income or loss also file. Administrative Release 43 supplies current apportionment rules; the general overview's older three-factor wording should not override those rules.", "sources": [ { "label": "Maryland Comptroller: corporate-income rate and domestic filing requirement", "url": "https://services.marylandcomptroller.gov/taxes/en/business-income-tax-information?id=kb_article_view&sysparm_article=KB0010043", "checked": "2026-10-11", "section": "Maryland Comptroller: corporate-income rate and domestic filing requirement" }, { "label": "Maryland Comptroller: Administrative Release 43 corporate apportionment", "url": "https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/legal-publications/administrative-releases/income-and-estate-tax/ar_it43.pdf", "checked": "2026-10-11", "section": "Maryland Comptroller: Administrative Release 43 corporate apportionment" }, { "label": "Maryland Comptroller: 2026 corporation estimated-tax worksheet", "url": "https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/forms/2026/500d.pdf", "checked": "2026-10-11", "section": "Maryland Comptroller: 2026 corporation estimated-tax worksheet" } ] }, "conversion": { "state": "Maryland", "code": "MD", "form": "Benefit corporation", "status": "Available", "group": "ordinary", "groupLabel": "Ordinary / qualified-majority route", "entryVote": "two-thirds default; charter can reduce to majority entitled votes", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry and exit use ordinary charter-amendment vote: two-thirds of entitled votes by default; charter can raise or lower to at least majority of entitled votes. No benefit-specific all-nonvoting-class override or legacy lock.", "proposal": "Keep benefit entry aligned with ordinary amendments; explain that the ordinary default is two-thirds and the charter may lower it to majority.", "sources": [ { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-03", "section": "\u00a7\u00a75-6C-03,-04;2-604(f);2-104(b)(5)" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=5-6C-04", "section": "\u00a75-6C-04" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=2-604", "section": "\u00a72-604(f)" }, { "url": "https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gca&enactments=false§ion=2-104", "section": "\u00a72-104(b)(5)" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required; identified specific charter benefits optional.", "difference": "Maryland offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter may exculpate both directors and officers against corporation/shareholder damages except actual improper benefit/profit and active deliberate dishonesty established by final judgment and material to claim. Special bank/financial-institution exceptions apply; other capacities unaffected. Benefit-specific rule: Reasonable compliance with director duties invokes statutory immunity; no explicit blanket corporation/officer mission-failure monetary bar in benefit subtitle.", "difference": "Maryland adds ordinary officer coverage; the charter must elect the ordinary protection. Both directors and officers can receive broad ordinary charter protection, with deliberate-dishonesty and improper-benefit exceptions. No designated benefit director or bespoke benefit-enforcement threshold." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to each shareholder within 120 days. Latest report public online or free on demand without a website. No state benefit-report filing in subtitle. Assessment rule: Annual social/environmental assessment against third-party standard required. Subtitle has no mandatory third-party audit or certification.", "difference": "Maryland: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $300 per year on an annualized basis. Minimum tax/license used here: $0. Small active domestic C corporation in a regular year with no Maryland taxable income after state modifications and apportionment. Form 500 remains required. SDAT annual-report and personal-property costs are excluded and must be evaluated separately.", "difference": "Maryland has a compared recurring floor of $300 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds default; charter can reduce to majority entitled votes. Entry and exit use ordinary charter-amendment vote: two-thirds of entitled votes by default; charter can raise or lower to at least majority of entitled votes. No benefit-specific all-nonvoting-class override or legacy lock. Changing back: same ordinary charter-amendment rule", "difference": "Maryland entry uses two-thirds default; charter can reduce to majority entitled votes; exit uses same ordinary charter-amendment rule. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider shareholders, employees/suppliers, customers, community/society and environment; beneficiaries gain no director duty merely from that status. No separate benefit director mandated. Disclosure: Annual to each shareholder within 120 days. Latest report public online or free on demand without a website. No state benefit-report filing in subtitle. Enforcement: The benefit subtitle creates no special ownership-percentage threshold or enforcement proceeding. A qualifying shareholder uses ordinary derivative remedies: plead entitlement at the challenged conduct and filing (or succession by law), adequate representation, and demand or a particularized excuse. Demand is excused only for irreparable harm from demand/delay or a board majority personally disabled from considering it under the statutory conduct standard. Potential director liability alone does not excuse demand.", "difference": "Maryland requires public access to the report. No designated benefit director or bespoke benefit-enforcement threshold. Demand is ordinarily required before a shareholder derivative suit; futility is narrowly limited and requires particularized facts." } } }, "guideUrl": "/assets/state-guides/MD.md" }, { "state": "Massachusetts", "abbreviation": "MA", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / independent-benefit-director model", "features": { "purpose": { "summary": "General benefit required; specific charter benefits optional and cannot significantly diminish general purpose.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section9", "section": "156E \u00a79" } ] }, "board": { "summary": "Mandatory stakeholder consideration and sound reasonable judgment. All benefit corporations need an independent benefit director, subject to boardless/professional-corporation exceptions.", "mode": "mandatory_consider", "benefitDirectorRequired": "all, with statutory exceptions", "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section10", "section": "\u00a7\u00a710-11" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section11", "section": "\u00a711" } ] }, "standard": { "summary": "Third-party standard assessment required; third-party certification/audit not required.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section15", "section": "\u00a715(a)-(b)" } ] }, "report": { "summary": "Annual to shareholders by earlier of 120 days or other annual report. Latest public online or free on request without website. Copy filed with state alongside annual report, extra $75.", "cadence": "annual", "shareholders": true, "publicWebsite": "most recent report", "stateFiling": true, "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section16", "section": "\u00a716" } ], "public": true }, "enforcement": { "summary": "Corporation; any shareholder, director, 5% parent equity, or persons allowed in charter/bylaws/shareholder agreement.", "shareholderThreshold": "any shareholder subject to derivative procedure", "directorStanding": true, "parentThreshold": "5% of parent equity", "otherStanding": "charter/bylaw/shareholder-agreement designees", "corporationStanding": true, "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section14", "section": "\u00a714(a)(4)" } ] }, "benefitLiability": { "summary": "Corporation mission-failure damages barred. Directors/officers protected for compliant conduct and mission failure; benefit-director immunity except self-dealing, wilful/intentional misconduct or knowing violation.", "corporationMissionDamagesBar": true, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section14", "section": "\u00a714(a)(3)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section10", "section": "\u00a710(d)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section12", "section": "\u00a712(c)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section11", "section": "\u00a711(e)" } ] }, "ordinaryExculpation": { "summary": "Charter director fiduciary-damages exculpation excludes loyalty breaches, bad faith, intentional misconduct/knowing law violations, improper distributions and improper personal benefit. No ordinary officer clause.", "director": true, "officer": false, "automatic": false, "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156D/Section2.02", "section": "156D \u00a72.02(b)(4)" } ] }, "statusChange": { "summary": "Entry/exit generally require two-thirds of every class/series including nonvoting; specified merger/asset transactions also require minimum status vote.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds of each class, including nonvoting", "optionalLock": false, "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section2", "section": "\u00a7\u00a72,5-8" } ] } }, "costs": { "regularReport": { "amount": 125, "currency": "USD", "cadence": "annual", "conditions": "Quoted paper or walk-in annual report: $125, excluding late charges. The ordinary electronic report is separately priced at $100 plus a mandatory $10 expedited fee ($110 total).", "paperAmount": 125, "electronicAmount": 110, "quotedMethod": "paper/walk-in", "summary": "Quoted paper or walk-in annual report: $125, excluding late charges. The ordinary electronic report is separately priced at $100 plus a mandatory $10 expedited fee ($110 total).", "sources": [ { "url": "https://www.sec.state.ma.us/divisions/corporations/download/Fee_Schedule.pdf", "section": "domestic/foreign business corporation annual report" } ] }, "benefitReport": { "amount": 75, "currency": "USD", "cadence": "annual", "conditions": "Paper or walk-in benefit report adds $75 to the $125 ordinary annual report: $200 in report filing fees. Agency instructions require a narrative Attachment Sheet filed with the annual report. Online/fax filings follow mandatory expedited-charge rules and are a separate payment method from this quoted paper baseline.", "paperAmount": 75, "quotedMethod": "paper/walk-in attachment with the ordinary annual report", "summary": "Paper or walk-in benefit report adds $75 to the $125 ordinary annual report: $200 in report filing fees. Agency instructions require a narrative Attachment Sheet filed with the annual report. Online/fax filings follow mandatory expedited-charge rules and are a separate payment method from this quoted paper baseline.", "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section16", "section": "156E \u00a716(d)" }, { "url": "https://www.sec.state.ma.us/divisions/corporations/general-information/benefit-corporations.htm", "section": "IV. Annual Reports for Benefit Corporations: attachment sheet and $75 additional fee" }, { "url": "https://www.sec.state.ma.us/divisions/corporations/download/Fee_Schedule.pdf", "section": "Domestic profit annual report paper/walk-in $125; electronic ordinary report $100 plus $10 expedite" }, { "url": "https://www.sec.state.ma.us/divisions/corporations/filing-methods/corporations-credit-card-instructions.htm", "section": "Credit Card or E-Check Payment Fees: mandatory filing and expedited fees for online/fax processing" } ] }, "minimumTax": { "amount": 456, "currency": "USD", "cadence": "annual", "conditions": "Minimum corporate excise is $456 for a business corporation subject to the excise. Ordinary C-corporation tax also has an 8% income measure and a $2.60 per $1,000 property/net-worth measure; losses alone do not remove the minimum. Special taxpayer classifications and exemptions have their own rules.", "summary": "Minimum corporate excise is $456 for a business corporation subject to the excise. Ordinary C-corporation tax also has an 8% income measure and a $2.60 per $1,000 property/net-worth measure; losses alone do not remove the minimum. Special taxpayer classifications and exemptions have their own rules.", "sources": [ { "url": "https://budget.digital.mass.gov/govbudget/fy26/tax-expenditure-budget/corporate-excise-tax/introduction", "section": "FY2026 corporate excise introduction" }, { "url": "https://budget.digital.mass.gov/govbudget/fy27/tax-expenditure-budget/corporate-excise-tax/introduction", "section": "FY2027 official tax-expenditure budget, business-corporation excise components and $456 minimum" }, { "label": "Massachusetts DOR: current tax rates", "url": "https://www.mass.gov/info-details/tax-rates", "checked": "2026-10-11", "section": "Massachusetts DOR: current tax rates" }, { "label": "Massachusetts Governor FY27 budget: corporate-excise components and minimum", "url": "https://budget.digital.mass.gov/govbudget/fy27/tax-expenditure-budget/corporate-excise-tax/introduction", "checked": "2026-10-11", "section": "Massachusetts Governor FY27 budget: corporate-excise components and minimum" }, { "label": "Massachusetts DOR: corporate excise guide", "url": "https://www.mass.gov/info-details/corporate-excise-tax-guide", "checked": "2026-10-11", "section": "Massachusetts DOR: corporate excise guide" } ] } }, "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section9", "section": "156E \u00a79" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section10", "section": "\u00a7\u00a710-11" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section11", "section": "\u00a711" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section15", "section": "\u00a715(a)-(b)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section16", "section": "\u00a716" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section14", "section": "\u00a714(a)(4)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section14", "section": "\u00a714(a)(3)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section10", "section": "\u00a710(d)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section12", "section": "\u00a712(c)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section11", "section": "\u00a711(e)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156D/Section2.02", "section": "156D \u00a72.02(b)(4)" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section2", "section": "\u00a7\u00a72,5-8" }, { "url": "https://www.sec.state.ma.us/divisions/corporations/download/Fee_Schedule.pdf", "section": "domestic/foreign business corporation annual report" }, { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section16", "section": "156E \u00a716(d)" }, { "url": "https://www.sec.state.ma.us/divisions/corporations/general-information/benefit-corporations.htm", "section": "IV. Annual Reports for Benefit Corporations: attachment sheet and $75 additional fee" }, { "url": "https://www.sec.state.ma.us/divisions/corporations/download/Fee_Schedule.pdf", "section": "Domestic profit annual report paper/walk-in $125; electronic ordinary report $100 plus $10 expedite" }, { "url": "https://www.sec.state.ma.us/divisions/corporations/filing-methods/corporations-credit-card-instructions.htm", "section": "Credit Card or E-Check Payment Fees: mandatory filing and expedited fees for online/fax processing" }, { "url": "https://budget.digital.mass.gov/govbudget/fy26/tax-expenditure-budget/corporate-excise-tax/introduction", "section": "FY2026 corporate excise introduction" }, { "url": "https://budget.digital.mass.gov/govbudget/fy27/tax-expenditure-budget/corporate-excise-tax/introduction", "section": "FY2027 official tax-expenditure budget, business-corporation excise components and $456 minimum" }, { "label": "Massachusetts DOR: current tax rates", "url": "https://www.mass.gov/info-details/tax-rates", "checked": "2026-10-11", "section": "Massachusetts DOR: current tax rates" }, { "label": "Massachusetts Governor FY27 budget: corporate-excise components and minimum", "url": "https://budget.digital.mass.gov/govbudget/fy27/tax-expenditure-budget/corporate-excise-tax/introduction", "checked": "2026-10-11", "section": "Massachusetts Governor FY27 budget: corporate-excise components and minimum" }, { "label": "Massachusetts DOR: corporate excise guide", "url": "https://www.mass.gov/info-details/corporate-excise-tax-guide", "checked": "2026-10-11", "section": "Massachusetts DOR: corporate excise guide" } ], "differences": [ "Independent benefit director is required even for an ordinary private startup.", "Any qualifying shareholder can enforce mission; no 2% or 5% direct-company threshold.", "Extra $75 annual benefit filing sits on top of corporate report and applicable $456 excise minimum." ], "gaps": [], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "The $200 annual report baseline uses the documented paper/walk-in method: $125 ordinary report and $75 attached benefit report. Electronic ordinary reporting is $110; online/fax processing has mandatory expedited charges. For-profit benefit status remains subject to applicable business-corporation tax rules.", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Massachusetts offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Massachusetts has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter director fiduciary-damages exculpation excludes loyalty breaches, bad faith, intentional misconduct/knowing law violations, improper distributions and improper personal benefit. No ordinary officer clause.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Massachusetts does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Massachusetts requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Massachusetts earns the benefit-specific credit for company. Corporation mission-failure damages barred. Directors/officers protected for compliant conduct and mission failure; benefit-director immunity except self-dealing, wilful/intentional misconduct or knowing violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Massachusetts earns the benefit-specific credit for directors. Corporation mission-failure damages barred. Directors/officers protected for compliant conduct and mission failure; benefit-director immunity except self-dealing, wilful/intentional misconduct or knowing violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Massachusetts earns the benefit-specific credit for officers. Corporation mission-failure damages barred. Directors/officers protected for compliant conduct and mission failure; benefit-director immunity except self-dealing, wilful/intentional misconduct or knowing violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 8, 8 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Massachusetts: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Massachusetts: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Massachusetts: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "Mandatory benefit director or report-approval procedure in this private-company scope: no 3-point flexibility bonus.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Massachusetts requires an additional benefit-director or report-approval procedure in this private-company scope, so it receives no no-extra-step credit. Mandatory stakeholder consideration and sound reasonable judgment. All benefit corporations need an independent benefit director, subject to boardless/professional-corporation exceptions.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 3, 3 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 3, 3 ], "reason": "Ordinary reporting $125 + benefit filing $75 = $200 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Massachusetts has a compared recurring floor of $656 per year, including $456 in identified minimum tax/license charges. Small active ordinary domestic C corporation, regular full year, no taxable profit and a property/net-worth measure low enough that combined excise stays at the $456 minimum. Annual registry reporting is separate. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry/exit generally require two-thirds of every class/series including nonvoting; specified merger/asset transactions also require minimum status vote.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Massachusetts: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Massachusetts: changing back requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Massachusetts requires report access for people outside the company, so it earns public-access credit. Annual to shareholders by earlier of 120 days or other annual report. Latest public online or free on request without website. Copy filed with state alongside annual report, extra $75.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Massachusetts: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Massachusetts: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Massachusetts makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration and sound reasonable judgment. All benefit corporations need an independent benefit director, subject to boardless/professional-corporation exceptions.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 200, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": true, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 656, "minimumTaxAnnualized": 456, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 61, 61 ], "tax": { "code": "MA", "incomeSummary": "An ordinary Massachusetts C corporation's corporate excise includes an 8% income measure plus a non-income measure of $2.60 per $1,000 of taxable Massachusetts tangible property or apportioned net worth. The total is subject to a $456 minimum; financial, security and other special corporations use different regimes.", "recurringSummary": "The ordinary business-corporation minimum excise is $456, including a loss or small income result; the property/net-worth component can increase the excise without profit. This is separate from the Secretary of the Commonwealth annual-report fee.", "formationAnnualTaxFloor": 456, "floorBasis": "Minimum for an ordinary nonexempt business corporation subject to Massachusetts excise, including domestic corporate status. No property or income assumption can reduce the ordinary minimum. Excludes registry reporting, special entities, property assessments, sales and payroll taxes and penalties.", "scenarioMinimum": 456, "scenarioBasis": "Small active ordinary domestic C corporation, regular full year, no taxable profit and a property/net-worth measure low enough that combined excise stays at the $456 minimum. Annual registry reporting is separate.", "operatingTaxCaution": "The official FY27 tax-expenditure introduction describes apportioned Massachusetts income and allocable tangible property/net worth. Both corporate-excise measures require their own calculations; forming elsewhere does not remove excise nexus from Massachusetts operations.", "sources": [ { "label": "Massachusetts DOR: current tax rates", "url": "https://www.mass.gov/info-details/tax-rates", "checked": "2026-10-11", "section": "Massachusetts DOR: current tax rates" }, { "label": "Massachusetts Governor FY27 budget: corporate-excise components and minimum", "url": "https://budget.digital.mass.gov/govbudget/fy27/tax-expenditure-budget/corporate-excise-tax/introduction", "checked": "2026-10-11", "section": "Massachusetts Governor FY27 budget: corporate-excise components and minimum" }, { "label": "Massachusetts DOR: corporate excise guide", "url": "https://www.mass.gov/info-details/corporate-excise-tax-guide", "checked": "2026-10-11", "section": "Massachusetts DOR: corporate excise guide" } ] }, "conversion": { "state": "Massachusetts", "code": "MA", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry/exit generally require two-thirds of every class/series including nonvoting; specified merger/asset transactions also require minimum status vote.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter156E/Section2", "section": "\u00a7\u00a72,5-8" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General benefit required; specific charter benefits optional and cannot significantly diminish general purpose.", "difference": "Massachusetts offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter director fiduciary-damages exculpation excludes loyalty breaches, bad faith, intentional misconduct/knowing law violations, improper distributions and improper personal benefit. No ordinary officer clause. Benefit-specific rule: Corporation mission-failure damages barred. Directors/officers protected for compliant conduct and mission failure; benefit-director immunity except self-dealing, wilful/intentional misconduct or knowing violation.", "difference": "Massachusetts keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Independent benefit director is required even for an ordinary private startup." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders by earlier of 120 days or other annual report. Latest public online or free on request without website. Copy filed with state alongside annual report, extra $75. Assessment rule: Third-party standard assessment required; third-party certification/audit not required.", "difference": "Massachusetts: Annual; Required outside framework; state benefit-report filing. An additional benefit-director or approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $200 per year on an annualized basis. Minimum tax/license used here: $456. Small active ordinary domestic C corporation, regular full year, no taxable profit and a property/net-worth measure low enough that combined excise stays at the $456 minimum. Annual registry reporting is separate.", "difference": "Massachusetts has a compared recurring floor of $656 per year, including $456 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Entry/exit generally require two-thirds of every class/series including nonvoting; specified merger/asset transactions also require minimum status vote. Changing back: two-thirds of each class, including nonvoting", "difference": "Massachusetts entry uses two-thirds of each class, including nonvoting; exit uses two-thirds of each class, including nonvoting. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration and sound reasonable judgment. All benefit corporations need an independent benefit director, subject to boardless/professional-corporation exceptions. Disclosure: Annual to shareholders by earlier of 120 days or other annual report. Latest public online or free on request without website. Copy filed with state alongside annual report, extra $75. Enforcement: Corporation; any shareholder, director, 5% parent equity, or persons allowed in charter/bylaws/shareholder agreement.", "difference": "Massachusetts requires public access to the report. Any qualifying shareholder can enforce mission; no 2% or 5% direct-company threshold. Extra $75 annual benefit filing sits on top of corporate report and applicable $456 excise minimum." } } }, "guideUrl": "/assets/state-guides/MA.md" }, { "state": "Michigan", "abbreviation": "MI", "form": "Proposed benefit corporation; not enacted", "status": "Gap", "reviewed": "2026-10-11", "family": "no dedicated form identified", "features": { "purpose": { "summary": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ], "generalRequired": null, "specificRequired": null, "specificOptional": null }, "board": { "summary": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ], "mode": "ordinary_corporation" }, "standard": { "summary": "No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ], "thirdPartyRequired": null, "certificationRequired": null }, "report": { "summary": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ], "cadence": "not_applicable", "shareholders": null, "publicWebsite": null, "stateFiling": null, "public": null }, "enforcement": { "summary": "No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ], "shareholderThreshold": "No dedicated benefit proceeding" }, "benefitLiability": { "summary": "No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "Director-only opt-in charter limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a7551 and intentional criminal acts. Officers do not receive this \u00a7209 charter protection merely by holding office.", "sources": [ { "url": "https://www.legislature.mi.gov/documents/mcl/pdf/mcl-284-1972-2.pdf", "section": "MCL 450.1209(1)(c), official Chapter 2 compilation" } ], "director": true, "officer": false, "automatic": false }, "statusChange": { "summary": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ], "entryVote": "not_applicable", "exitVote": "not_applicable", "optionalLock": false } }, "costs": { "regularReport": { "amount": 25, "cadence": "annual", "conditions": "Domestic corporation annual report $25.", "summary": "Domestic corporation annual report $25.", "sources": [ { "url": "https://www.michigan.gov/lara/bureau-list/cscl/corps/how-do-i/renewals/renew-my-corporation", "section": "Corporate report fees" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate statutory benefit form/report identified.", "summary": "No separate statutory benefit form/report identified.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ] }, "minimumTax": { "amount": null, "conditions": "Corporate income tax is activity- and income-based rather than a flat incorporation charge: standard taxpayers with Michigan nexus file when Michigan apportioned receipts reach $350,000 and tax liability exceeds $100. A liability of $100 or less has no payment requirement; financial institutions/insurance have separate rules.", "summary": "Corporate income tax is activity- and income-based rather than a flat incorporation charge: standard taxpayers with Michigan nexus file when Michigan apportioned receipts reach $350,000 and tax liability exceeds $100. A liability of $100 or less has no payment requirement; financial institutions/insurance have separate rules.", "sources": [ { "url": "https://www.michigan.gov/taxes/business-taxes/cit/accordion", "section": "CIT filing requirements and $100 liability threshold" }, { "label": "Michigan Treasury: standard Corporate Income Tax base and 6% rate", "url": "https://www.michigan.gov/taxes/business-taxes/cit/detail/corporate-tax-base", "checked": "2026-10-11", "section": "Michigan Treasury: standard Corporate Income Tax base and 6% rate" }, { "label": "Michigan Treasury: CIT filing/payment thresholds, nexus, apportionment, and separate industry taxes", "url": "https://www.michigan.gov/taxes/questions/cit", "checked": "2026-10-11", "section": "Michigan Treasury: CIT filing/payment thresholds, nexus, apportionment, and separate industry taxes" } ] } }, "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" }, { "url": "https://www.legislature.mi.gov/documents/mcl/pdf/mcl-284-1972-2.pdf", "section": "MCL 450.1209(1)(c), official Chapter 2 compilation" }, { "url": "https://www.michigan.gov/lara/bureau-list/cscl/corps/how-do-i/renewals/renew-my-corporation", "section": "Corporate report fees" }, { "url": "https://www.michigan.gov/taxes/business-taxes/cit/accordion", "section": "CIT filing requirements and $100 liability threshold" }, { "label": "Michigan Treasury: standard Corporate Income Tax base and 6% rate", "url": "https://www.michigan.gov/taxes/business-taxes/cit/detail/corporate-tax-base", "checked": "2026-10-11", "section": "Michigan Treasury: standard Corporate Income Tax base and 6% rate" }, { "label": "Michigan Treasury: CIT filing/payment thresholds, nexus, apportionment, and separate industry taxes", "url": "https://www.michigan.gov/taxes/questions/cit", "checked": "2026-10-11", "section": "Michigan Treasury: CIT filing/payment thresholds, nexus, apportionment, and separate industry taxes" } ], "differences": [ "Director-only opt-in charter limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a7551 and intentional criminal acts. Officers do not receive this \u00a7209 charter protection merely by holding office.", "Domestic corporation annual report $25.", "The form-availability gap is the only shared grouping; ordinary protections and charges differ." ], "gaps": [ "Ordinary charter protections concern specified internal monetary claims; personally committed wrongs and liabilities imposed by other statutes remain separate." ], "confidence": "Current fee source; official ordinary-code verification where stated", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 0, 0 ], "reason": "Proposed benefit corporation; not enacted. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Michigan has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason. A nonprofit public-benefit corporation is a different entity and does not fill this for-profit gap.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 6, 6 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Michigan has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only opt-in charter limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a7551 and intentional criminal acts. Officers do not receive this \u00a7209 charter protection merely by holding office.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Michigan does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Michigan requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Michigan has no separately credited benefit-specific monetary shield for company. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Michigan has no separately credited benefit-specific monetary shield for directors. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Michigan has no separately credited benefit-specific monetary shield for officers. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 0, 0 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Michigan: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Michigan: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Michigan: No dedicated form. No dedicated benefit form means this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Michigan has no dedicated benefit form, so this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $25 + benefit filing $0 = $25 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Michigan has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation under the standard CIT regime, Michigan apportioned/allocated gross receipts below $350,000, and no Michigan taxable profit: $0 CIT. Excludes registry fees, legacy MBT elections, financial/insurance regimes, and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Michigan: becoming a benefit company requires No dedicated for-profit benefit election applies. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Michigan: changing back requires not_applicable. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Michigan has no dedicated benefit-report rule in this ordinary form, so it receives no benefit-publication credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Michigan: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Michigan: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Michigan has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 25, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "not_applicable", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 25, "minimumTaxAnnualized": 0, "entryCategory": "not_applicable" }, "grouping": { "assessment": "No dedicated form", "cadence": "No dedicated form", "filing": "No dedicated form", "ordinaryScope": "Director scope only", "exit": "No dedicated form" }, "scoreRange": [ 21, 21 ], "tax": { "code": "MI", "incomeSummary": "Michigan's standard Corporate Income Tax is 6% of the corporate income tax base after allocation/apportionment. For ordinary taxpayers, apportioned/allocated gross receipts below $350,000 or tax liability of $100 or less remove the CIT return/payment requirement. The $100 amount is a liability threshold, not an annual minimum tax.", "recurringSummary": "No general fixed franchise/capital minimum for an ordinary standard CIT civic/technology corporation. Financial institutions and insurers have separate industry regimes; a financial-institution franchise tax is not a general incorporation charge. Corporate annual report fees remain separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive charter-only annual tax floor for an ordinary standard CIT domestic stock corporation. Thresholds and taxable income govern CIT; the $100 liability threshold must not be added as a mandatory fee.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation under the standard CIT regime, Michigan apportioned/allocated gross receipts below $350,000, and no Michigan taxable profit: $0 CIT. Excludes registry fees, legacy MBT elections, financial/insurance regimes, and other operating taxes.", "operatingTaxCaution": "Michigan nexus can arise from physical presence, active solicitation with Michigan receipts, or interests in a flow-through entity with nexus. Business income and sales of unitary groups affect the base and single-sales-factor apportionment. Threshold eligibility must be tested using the tax-defined receipts and group, not a homepage revenue estimate.", "sources": [ { "label": "Michigan Treasury: standard Corporate Income Tax base and 6% rate", "url": "https://www.michigan.gov/taxes/business-taxes/cit/detail/corporate-tax-base", "checked": "2026-10-11", "section": "Michigan Treasury: standard Corporate Income Tax base and 6% rate" }, { "label": "Michigan Treasury: CIT filing/payment thresholds, nexus, apportionment, and separate industry taxes", "url": "https://www.michigan.gov/taxes/questions/cit", "checked": "2026-10-11", "section": "Michigan Treasury: CIT filing/payment thresholds, nexus, apportionment, and separate industry taxes" } ] }, "conversion": { "state": "Michigan", "code": "MI", "form": "Proposed benefit corporation; not enacted", "status": "Gap", "group": "gap", "groupLabel": "Enact a benefit option", "entryVote": "No dedicated for-profit benefit election applies", "route": "No same-state benefit-status amendment route identified; a benefit chapter is needed. A move to another jurisdiction requires its own authorized domestication, conversion or merger route.", "currentDetail": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "proposal": "Enact a for-profit benefit chapter with a same-company amendment route, ordinary amendment voting and usable agency forms.", "sources": [ { "url": "https://legislature.mi.gov/Laws/MCL?objectName=mcl-Act-284-of-1972", "section": "Business Corporation Act; SB 789 pending" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "difference": "Michigan has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only opt-in charter limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a7551 and intentional criminal acts. Officers do not receive this \u00a7209 charter protection merely by holding office. Benefit-specific rule: No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "difference": "Michigan keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Director-only opt-in charter limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a7551 and intentional criminal acts. Officers do not receive this \u00a7209 charter protection merely by holding office." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Assessment rule: No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "difference": "No benefit reporting credit applies because this state does not offer the requested form; that does not mean an ordinary company has no filings." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $25 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation under the standard CIT regime, Michigan apportioned/allocated gross receipts below $350,000, and no Michigan taxable profit: $0 CIT. Excludes registry fees, legacy MBT elections, financial/insurance regimes, and other operating taxes.", "difference": "Michigan has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: No dedicated for-profit benefit election applies. Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules. Changing back: not_applicable", "difference": "No direct benefit-status election or exit exists in this state; an interstate move or a law change is a different process." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute. Disclosure: No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Enforcement: No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "difference": "The ordinary corporation has no dedicated statutory benefit duty/report in this reviewed form. That is why it receives no benefit-accountability credit." } } }, "guideUrl": "/assets/state-guides/MI.md" }, { "state": "Minnesota", "abbreviation": "MN", "form": "Public benefit corporation: general or specific", "status": "Available", "reviewed": "2026-10-11", "family": "Separate general/specific benefit models; state-filed annual report", "features": { "purpose": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.101", "section": "Minn. Stat. 304A.101" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.104", "section": "Minn. Stat. 304A.104" } ], "confidence": "high", "generalRequired": false, "specificRequired": false, "specificOptional": true, "variants": { "GBC": { "generalRequired": true, "specificRequired": false }, "SBC": { "generalRequired": false, "specificRequired": true } }, "summary": "Choose general benefit corporation (GBC, optional specific benefit too) or specific benefit corporation (SBC, specific only). General purpose is not required for SBC. Name must state GBC/general benefit corporation or SBC/specific benefit corporation." }, "board": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.201", "section": "Minn. Stat. 304A.201" } ], "confidence": "high", "mode": "variant_specific_mandatory_consideration", "summary": "GBC directors shall consider general benefit and affected stakeholders. SBC directors shall consider chosen benefit/shareholders and may consider other stakeholders. Neither gives regular/presumptive/permanent financial priority; charter may identify priorities. Charter may opt in to disinterested-failure safe harbor." }, "standard": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.301", "section": "Minn. Stat. 304A.301" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.301", "section": "Minn. Stat. 304A.301" } ], "confidence": "high", "required": null, "variants": { "GBC": true, "SBC": false }, "requirementMode": "variant-specific", "requiredForGeneralBenefitCorporation": true, "requiredForSpecificBenefitCorporation": false, "summary": "General benefit corporation (GBC): third-party standard required in the annual report; specific benefit corporation (SBC): narrative of the stated specific benefit and board approval, without a mandatory third-party standard. Null in the aggregate boolean denotes this resolved variant distinction, not missing research. No third-party audit or certification required.", "thirdPartyRequired": null, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.301", "section": "Minn. Stat. 304A.301" } ], "confidence": "high", "required": false, "summary": "No third-party audit or certification required." }, "report": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.301", "section": "Minn. Stat. 304A.301" }, { "url": "https://sos.mn.gov/business-liens/business-liens-data/public-benefit-corporation-annual-reports-2026/", "section": "SOS public annual-report archive 2026" }, { "url": "https://www.sos.mn.gov/business-liens/start-a-business/public-benefit-corporation-information/", "section": "Annual benefit reporting and reinstatement instructions" }, { "url": "https://www.revisor.mn.gov/statutes/cite/302A.461", "section": "Minn. Stat. 302A.461: inspection rights" }, { "url": "https://www.revisor.mn.gov/statutes/cite/302A.463", "section": "Minn. Stat. 302A.463: financial statements on request" } ], "confidence": "high", "cadence": "annual", "shareholders": false, "public": true, "stateFiling": true, "summary": "Annual state-filed report before April 1 for prior calendar year; CEO signs within 30 days of submission and board approves. SOS publishes reports; company website publication is not required here. Nonfiling revokes status. Reinstatement statute specifies $500 fee within 30 days; agency lists total reinstatement $540 mail/$560 counter. Failure to remove benefit designation within 30 days after status ends automatically expires corporate duration. Section 304A.301 requires filing with the Secretary of State and does not impose a separate automatic delivery to shareholders. Ordinary shareholder inspection rights under 302A.461 and financial-statement delivery upon written request under 302A.463 remain available; those are separate from benefit-report distribution." }, "enforcement": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.202", "section": "Minn. Stat. 304A.202" } ], "confidence": "high", "threshold": "any_shareholder", "summary": "Only shareholders may assert benefit-failure claims; no percentage floor stated. Courts may terminate benefit status, remove directors, or appoint receiver to operate/liquidate for substantial/sustained failure." }, "benefitLiability": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.202", "section": "Minn. Stat. 304A.202" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.201", "section": "Minn. Stat. 304A.201" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A/full", "section": "Minn. Stat. Chapter 304A, full current chapter" } ], "confidence": "high", "company": true, "directors": false, "officers": false, "summary": "Corporation barred from money damages for benefit failure. Director who performs required benefit duties not liable by virtue of being director; this is conditional compliance protection. The benefit chapter provides no distinct officer benefit-failure monetary shield." }, "ordinaryExculpation": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/302A.251", "section": "Minn. Stat. 302A.251" } ], "confidence": "high", "director": true, "officer": false, "optIn": true, "summary": "Director-only charter monetary exculpation excludes loyalty, bad faith/intentional misconduct/knowing illegality, distribution liability, specified securities liability, improper benefit and pre-effective acts.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.021", "section": "Minn. Stat. 304A.021" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.102", "section": "Minn. Stat. 304A.102" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.103", "section": "Minn. Stat. 304A.103" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.104", "section": "Minn. Stat. 304A.104" } ], "confidence": "high", "entry": "2/3 all issued/outstanding", "exit": "2/3 all issued/outstanding", "lock": "3-year reentry wait after any termination or repeated revocation", "summary": "2/3 ALL issued/outstanding shares for entry/exit and required mission amendments; dissenters fair-value rights. Any voluntary termination, or revocation more than once, triggers a three-year waiting period to reelect.", "exitVote": "2/3 all issued/outstanding", "entryVote": "2/3 all issued/outstanding" } }, "costs": { "regularReport": { "sources": [ { "url": "https://www.sos.mn.gov/fees", "section": "Domestic business corporation annual renewal" } ], "confidence": "high", "amount": 0, "cadence": "annual", "online": 0, "paper": 0, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Timely ordinary domestic corporation annual renewal $0.", "conditions": "Timely ordinary domestic corporation annual renewal $0." }, "benefitReport": { "sources": [ { "url": "https://www.sos.mn.gov/business-liens/start-a-business/business-filing-certification-fee-schedule/", "section": "Public Benefit Corporation Annual Benefit Report" } ], "confidence": "high", "amount": 35, "cadence": "annual", "online": 55, "paper": 35, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Separate annual benefit report $35 mail/$55 online or in person (expedited).", "conditions": "Separate annual benefit report $35 mail/$55 online or in person (expedited)." }, "minimumTax": { "sources": [ { "url": "https://www.revenue.state.mn.us/minimum-fee", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.revenue.state.mn.us/sites/default/files/2026-02/2024-tax-handbook-supplement-final.pdf", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.revenue.state.mn.us/corporation-franchise-tax", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Minnesota Revenue: 2026 minimum-fee tiers, applicability, and exemptions", "url": "https://www.revenue.state.mn.us/minimum-fee", "checked": "2026-10-11", "section": "Minnesota Revenue: 2026 minimum-fee tiers, applicability, and exemptions" }, { "label": "Minnesota Revenue: corrected tax handbook, corporate franchise and AMT calculation", "url": "https://www.revenue.state.mn.us/sites/default/files/2026-06/2024-tax-handbook-online-post-publication-corrected.pdf", "checked": "2026-10-11", "section": "Minnesota Revenue: corrected tax handbook, corporate franchise and AMT calculation" }, { "label": "Minnesota Revenue: January 1, 2026 major tax rates", "url": "https://www.revenue.state.mn.us/sites/default/files/2026-02/2024-tax-handbook-supplement-final.pdf", "checked": "2026-10-11", "section": "Minnesota Revenue: January 1, 2026 major tax rates" }, { "label": "Minnesota Revenue: corporate franchise filing scope", "url": "https://www.revenue.state.mn.us/corporation-franchise-tax", "checked": "2026-10-11", "section": "Minnesota Revenue: corporate franchise filing scope" } ], "confidence": "high", "amount": 0, "cadence": "annual; liability depends on applicable tax base/exemptions", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "calculationRequired": true, "universalFlatMinimum": false, "summary": "Minnesota corporation franchise tax is income-based (9.8% for C corporations with Minnesota nexus). A separate 2026 minimum fee depends on the SUM of Minnesota property, payroll and sales/receipts: below $1,280,000=$0; $1,280,000-$2,559,999=$260; $2,560,000-$12,829,999=$770; $12,830,000-$25,639,999=$2,560; $25,640,000-$51,279,999=$5,140; $51,280,000+=$12,830. Regulated investment companies, REITs and REMICs are exempt from this minimum fee; qualifying federal P.L. 86-272 protection/no filing requirement also matters. This is not a universal $260 floor and is separate from the benefit-report filing fee.", "conditions": "Minnesota corporation franchise tax is income-based (9.8% for C corporations with Minnesota nexus). A separate 2026 minimum fee depends on the SUM of Minnesota property, payroll and sales/receipts: below $1,280,000=$0; $1,280,000-$2,559,999=$260; $2,560,000-$12,829,999=$770; $12,830,000-$25,639,999=$2,560; $25,640,000-$51,279,999=$5,140; $51,280,000+=$12,830. Regulated investment companies, REITs and REMICs are exempt from this minimum fee; qualifying federal P.L. 86-272 protection/no filing requirement also matters. This is not a universal $260 floor and is separate from the benefit-report filing fee." } }, "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.101", "section": "Minn. Stat. 304A.101" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.104", "section": "Minn. Stat. 304A.104" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.201", "section": "Minn. Stat. 304A.201" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.301", "section": "Minn. Stat. 304A.301" }, { "url": "https://sos.mn.gov/business-liens/business-liens-data/public-benefit-corporation-annual-reports-2026/", "section": "SOS public annual-report archive 2026" }, { "url": "https://www.sos.mn.gov/business-liens/start-a-business/public-benefit-corporation-information/", "section": "Annual benefit reporting and reinstatement instructions" }, { "url": "https://www.revisor.mn.gov/statutes/cite/302A.461", "section": "Minn. Stat. 302A.461: inspection rights" }, { "url": "https://www.revisor.mn.gov/statutes/cite/302A.463", "section": "Minn. Stat. 302A.463: financial statements on request" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.202", "section": "Minn. Stat. 304A.202" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A/full", "section": "Minn. Stat. Chapter 304A, full current chapter" }, { "url": "https://www.revisor.mn.gov/statutes/cite/302A.251", "section": "Minn. Stat. 302A.251" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.021", "section": "Minn. Stat. 304A.021" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.102", "section": "Minn. Stat. 304A.102" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.103", "section": "Minn. Stat. 304A.103" }, { "url": "https://www.sos.mn.gov/fees", "section": "Domestic business corporation annual renewal" }, { "url": "https://www.sos.mn.gov/business-liens/start-a-business/business-filing-certification-fee-schedule/", "section": "Public Benefit Corporation Annual Benefit Report" }, { "url": "https://www.revenue.state.mn.us/minimum-fee", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.revenue.state.mn.us/sites/default/files/2026-02/2024-tax-handbook-supplement-final.pdf", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.revenue.state.mn.us/corporation-franchise-tax", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Minnesota Revenue: 2026 minimum-fee tiers, applicability, and exemptions", "url": "https://www.revenue.state.mn.us/minimum-fee", "checked": "2026-10-11", "section": "Minnesota Revenue: 2026 minimum-fee tiers, applicability, and exemptions" }, { "label": "Minnesota Revenue: corrected tax handbook, corporate franchise and AMT calculation", "url": "https://www.revenue.state.mn.us/sites/default/files/2026-06/2024-tax-handbook-online-post-publication-corrected.pdf", "checked": "2026-10-11", "section": "Minnesota Revenue: corrected tax handbook, corporate franchise and AMT calculation" }, { "label": "Minnesota Revenue: January 1, 2026 major tax rates", "url": "https://www.revenue.state.mn.us/sites/default/files/2026-02/2024-tax-handbook-supplement-final.pdf", "checked": "2026-10-11", "section": "Minnesota Revenue: January 1, 2026 major tax rates" }, { "label": "Minnesota Revenue: corporate franchise filing scope", "url": "https://www.revenue.state.mn.us/corporation-franchise-tax", "checked": "2026-10-11", "section": "Minnesota Revenue: corporate franchise filing scope" } ], "differences": [ "General-benefit corporations require a third-party assessment standard; specific-benefit corporations do not. Both variants file annual benefit reports with the state.", "State report and revocation consequence; retaining benefit name after status ends can automatically expire corporation.", "Court equitable remedies can remove directors or appoint receiver.", "Mandatory GBC/SBC naming designation.", "Three-year reentry wait after any voluntary termination or repeated revocation." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "Current official Minnesota statutory compilation is labelled 2025. Annual report statute and current 2026 agency reporting/fee guidance were read together.", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Public benefit corporation: general or specific. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Minnesota offers Public benefit corporation: general or specific. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 12, 12 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Minnesota has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only charter monetary exculpation excludes loyalty, bad faith/intentional misconduct/knowing illegality, distribution liability, specified securities liability, improper benefit and pre-effective acts.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Minnesota does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Minnesota requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Minnesota earns the benefit-specific credit for company. Corporation barred from money damages for benefit failure. Director who performs required benefit duties not liable by virtue of being director; this is conditional compliance protection. The benefit chapter provides no distinct officer benefit-failure monetary shield.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Compliant-director-duty protection receives 4 points; not a blanket outcome guarantee.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Minnesota earns the benefit-specific credit for directors. Corporation barred from money damages for benefit failure. Director who performs required benefit duties not liable by virtue of being director; this is conditional compliance protection. The benefit chapter provides no distinct officer benefit-failure monetary shield.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Minnesota has no separately credited benefit-specific monetary shield for officers. Corporation barred from money damages for benefit failure. Director who performs required benefit duties not liable by virtue of being director; this is conditional compliance protection. The benefit chapter provides no distinct officer benefit-failure monetary shield.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Minnesota: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Minnesota: Required. Using an outside framework reduces flexibility credit but earns transparency credit. General benefit corporation (GBC): third-party standard required in the annual report; specific benefit corporation (SBC): narrative of the stated specific benefit and board approval, without a mandatory third-party standard. Null in the aggregate boolean denotes this resolved variant distinction, not missing research. No third-party audit or certification required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Minnesota: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Minnesota has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $35 = $35 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Minnesota has a compared recurring floor of $35 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation with Minnesota property plus payroll plus sales/receipts below $1,280,000 in 2026, zero Minnesota taxable income, and no taxable AMT base: $0 regular tax, AMT, and minimum fee. Excludes report and operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "2/3 ALL issued/outstanding shares for entry/exit and required mission amendments; dissenters fair-value rights. Any voluntary termination, or revocation more than once, triggers a three-year waiting period to reelect.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Minnesota: becoming a benefit company requires 2/3 all issued/outstanding. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. 2/3 ALL issued/outstanding shares for entry/exit and required mission amendments; dissenters fair-value rights. Any voluntary termination, or revocation more than once, triggers a three-year waiting period to reelect.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Minnesota: changing back requires 2/3 all issued/outstanding. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. 2/3 ALL issued/outstanding shares for entry/exit and required mission amendments; dissenters fair-value rights. Any voluntary termination, or revocation more than once, triggers a three-year waiting period to reelect.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Minnesota requires report access for people outside the company, so it earns public-access credit. Annual state-filed report before April 1 for prior calendar year; CEO signs within 30 days of submission and board approves. SOS publishes reports; company website publication is not required here. Nonfiling revokes status. Reinstatement statute specifies $500 fee within 30 days; agency lists total reinstatement $540 mail/$560 counter. Failure to remove benefit designation within 30 days after status ends automatically expires corporate duration. Section 304A.301 requires filing with the Secretary of State and does not impose a separate automatic delivery to shareholders. Ordinary shareholder inspection rights under 302A.461 and financial-statement delivery upon written request under 302A.463 remain available; those are separate from benefit-report distribution.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Minnesota: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Minnesota: Required. Using an outside framework reduces flexibility credit but earns transparency credit. General benefit corporation (GBC): third-party standard required in the annual report; specific benefit corporation (SBC): narrative of the stated specific benefit and board approval, without a mandatory third-party standard. Null in the aggregate boolean denotes this resolved variant distinction, not missing research. No third-party audit or certification required.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Minnesota makes a mission duty mandatory, so it earns this credit. GBC directors shall consider general benefit and affected stakeholders. SBC directors shall consider chosen benefit/shareholders and may consider other stakeholders. Neither gives regular/presumptive/permanent financial priority; charter may identify priorities. Charter may opt in to disinterested-failure safe harbor.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 35, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "General benefit corporation", "recurringMinimumAnnualized": 35, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 72, 72 ], "tax": { "code": "MN", "incomeSummary": "Minnesota ordinary C-corporation franchise tax is 9.8% of Minnesota taxable income. A 5.8% alternative minimum tax on the alternative minimum taxable base can apply when it exceeds regular tax, subject to exemptions and adjustments; this is not a flat annual minimum.", "recurringSummary": "A separate 2026 minimum fee uses the sum of Minnesota property, payroll, and sales/receipts: below $1,280,000, $0; $1,280,000-$2,559,999, $260; $2,560,000-$12,829,999, $770; $12,830,000-$25,639,999, $2,560; $25,640,000-$51,279,999, $5,140; $51,280,000 or more, $12,830. RICs, REITs, and REMICs are exempt; federal P.L. 86-272 protection without a Minnesota filing requirement can also remove the fee. Report fees are separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive universal domestic stock-corporation tax floor: the minimum fee is dependent on Minnesota property/payroll/sales and ordinary income/AMT depend on their tax bases. It is not an unconditional $260 charge. Registry/benefit-report fees are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation with Minnesota property plus payroll plus sales/receipts below $1,280,000 in 2026, zero Minnesota taxable income, and no taxable AMT base: $0 regular tax, AMT, and minimum fee. Excludes report and operating taxes.", "operatingTaxCaution": "Minnesota nexus and tax-specific sourcing determine the income calculation. The minimum-fee sum can differ from the apportionment amounts and changes annually for inflation, so a low revenue figure alone does not establish the $0 tier. Income, minimum fee, and registry/benefit-report charges must be calculated separately.", "sources": [ { "label": "Minnesota Revenue: 2026 minimum-fee tiers, applicability, and exemptions", "url": "https://www.revenue.state.mn.us/minimum-fee", "checked": "2026-10-11", "section": "Minnesota Revenue: 2026 minimum-fee tiers, applicability, and exemptions" }, { "label": "Minnesota Revenue: corrected tax handbook, corporate franchise and AMT calculation", "url": "https://www.revenue.state.mn.us/sites/default/files/2026-06/2024-tax-handbook-online-post-publication-corrected.pdf", "checked": "2026-10-11", "section": "Minnesota Revenue: corrected tax handbook, corporate franchise and AMT calculation" }, { "label": "Minnesota Revenue: January 1, 2026 major tax rates", "url": "https://www.revenue.state.mn.us/sites/default/files/2026-02/2024-tax-handbook-supplement-final.pdf", "checked": "2026-10-11", "section": "Minnesota Revenue: January 1, 2026 major tax rates" }, { "label": "Minnesota Revenue: corporate franchise filing scope", "url": "https://www.revenue.state.mn.us/corporation-franchise-tax", "checked": "2026-10-11", "section": "Minnesota Revenue: corporate franchise filing scope" } ] }, "conversion": { "state": "Minnesota", "code": "MN", "form": "Public benefit corporation: general or specific", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 all issued/outstanding", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "2/3 ALL issued/outstanding shares for entry/exit and required mission amendments; dissenters fair-value rights. Any voluntary termination, or revocation more than once, triggers a three-year waiting period to reelect.", "proposal": "Consider ordinary-amendment entry and status-only appraisal reform; separately review the three-year reelection wait after termination.", "sources": [ { "url": "https://www.revisor.mn.gov/statutes/cite/304A.021", "section": "Minn. Stat. 304A.021" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.102", "section": "Minn. Stat. 304A.102" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.103", "section": "Minn. Stat. 304A.103" }, { "url": "https://www.revisor.mn.gov/statutes/cite/304A.104", "section": "Minn. Stat. 304A.104" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Choose general benefit corporation (GBC, optional specific benefit too) or specific benefit corporation (SBC, specific only). General purpose is not required for SBC. Name must state GBC/general benefit corporation or SBC/specific benefit corporation.", "difference": "Minnesota offers Public benefit corporation: general or specific." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only charter monetary exculpation excludes loyalty, bad faith/intentional misconduct/knowing illegality, distribution liability, specified securities liability, improper benefit and pre-effective acts. Benefit-specific rule: Corporation barred from money damages for benefit failure. Director who performs required benefit duties not liable by virtue of being director; this is conditional compliance protection. The benefit chapter provides no distinct officer benefit-failure monetary shield.", "difference": "Minnesota keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Court equitable remedies can remove directors or appoint receiver." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual state-filed report before April 1 for prior calendar year; CEO signs within 30 days of submission and board approves. SOS publishes reports; company website publication is not required here. Nonfiling revokes status. Reinstatement statute specifies $500 fee within 30 days; agency lists total reinstatement $540 mail/$560 counter. Failure to remove benefit designation within 30 days after status ends automatically expires corporate duration. Section 304A.301 requires filing with the Secretary of State and does not impose a separate automatic delivery to shareholders. Ordinary shareholder inspection rights under 302A.461 and financial-statement delivery upon written request under 302A.463 remain available; those are separate from benefit-report distribution. Assessment rule: General benefit corporation (GBC): third-party standard required in the annual report; specific benefit corporation (SBC): narrative of the stated specific benefit and board approval, without a mandatory third-party standard. Null in the aggregate boolean denotes this resolved variant distinction, not missing research. No third-party audit or certification required.", "difference": "Minnesota: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $35 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation with Minnesota property plus payroll plus sales/receipts below $1,280,000 in 2026, zero Minnesota taxable income, and no taxable AMT base: $0 regular tax, AMT, and minimum fee. Excludes report and operating taxes.", "difference": "Minnesota has a compared recurring floor of $35 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 all issued/outstanding. 2/3 ALL issued/outstanding shares for entry/exit and required mission amendments; dissenters fair-value rights. Any voluntary termination, or revocation more than once, triggers a three-year waiting period to reelect. Changing back: 2/3 all issued/outstanding", "difference": "Minnesota entry uses 2/3 all issued/outstanding; exit uses 2/3 all issued/outstanding. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "GBC directors shall consider general benefit and affected stakeholders. SBC directors shall consider chosen benefit/shareholders and may consider other stakeholders. Neither gives regular/presumptive/permanent financial priority; charter may identify priorities. Charter may opt in to disinterested-failure safe harbor. Disclosure: Annual state-filed report before April 1 for prior calendar year; CEO signs within 30 days of submission and board approves. SOS publishes reports; company website publication is not required here. Nonfiling revokes status. Reinstatement statute specifies $500 fee within 30 days; agency lists total reinstatement $540 mail/$560 counter. Failure to remove benefit designation within 30 days after status ends automatically expires corporate duration. Section 304A.301 requires filing with the Secretary of State and does not impose a separate automatic delivery to shareholders. Ordinary shareholder inspection rights under 302A.461 and financial-statement delivery upon written request under 302A.463 remain available; those are separate from benefit-report distribution. Enforcement: Only shareholders may assert benefit-failure claims; no percentage floor stated. Courts may terminate benefit status, remove directors, or appoint receiver to operate/liquidate for substantial/sustained failure.", "difference": "Minnesota requires public access to the report. General-benefit corporations require a third-party assessment standard; specific-benefit corporations do not. Both variants file annual benefit reports with the state. State report and revocation consequence; retaining benefit name after status ends can automatically expire corporation." } } }, "guideUrl": "/assets/state-guides/MN.md" }, { "state": "Mississippi", "abbreviation": "MS", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "reviewed": "2026-10-11", "family": "no dedicated form identified", "features": { "purpose": { "summary": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ], "generalRequired": null, "specificRequired": null, "specificOptional": null }, "board": { "summary": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ], "mode": "ordinary_corporation" }, "standard": { "summary": "No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ], "thirdPartyRequired": null, "certificationRequired": null }, "report": { "summary": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ], "cadence": "not_applicable", "shareholders": null, "publicWebsite": null, "stateFiling": null, "public": null }, "enforcement": { "summary": "No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ], "shareholderThreshold": "No dedicated benefit proceeding" }, "benefitLiability": { "summary": "No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a779-4-8.33 and intentional criminal-law violations. Officer indemnification is a separate mechanism; this articles provision does not grant officer exculpation.", "sources": [ { "url": "https://billstatus.ls.state.ms.us/documents/2016/html/SB/2400-2499/SB2483SG.htm", "section": "\u00a779-4-2.02(b)(4), enrolled SB2483 (2016 ch.435)" }, { "url": "https://legiscan.com/MS/text/SB2483/2016", "section": "Mirror of enrolled legislative primary text; Governor approval April 18, 2016" } ], "director": true, "officer": false, "automatic": false }, "statusChange": { "summary": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ], "entryVote": "not_applicable", "exitVote": "not_applicable", "optionalLock": false } }, "costs": { "regularReport": { "amount": 25, "cadence": "annual", "conditions": "October 2024 official fee schedule: corporate annual report $25.", "summary": "October 2024 official fee schedule: corporate annual report $25.", "sources": [ { "url": "https://www.sos.ms.gov/content/documents/Business/Services%20%26%20Fees%20Document.pdf", "section": "Corporate report fees" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate statutory benefit form/report identified.", "summary": "No separate statutory benefit form/report identified.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ] }, "minimumTax": { "amount": 25, "conditions": "2026 corporate franchise tax minimum is $25; rate is $0.50 per $1,000 (or fraction) on the applicable capital/property base above the statutory exclusion. Minimum income tax is not imposed. Franchise tax falls to $0.25 in 2027 and is repealed January 1, 2028. Registry reporting remains separate.", "summary": "2026 corporate franchise tax minimum is $25; rate is $0.50 per $1,000 (or fraction) on the applicable capital/property base above the statutory exclusion. Minimum income tax is not imposed. Franchise tax falls to $0.25 in 2027 and is repealed January 1, 2028. Registry reporting remains separate.", "sources": [ { "url": "https://dor.ms.gov/business/business-tax-frequently-asked-questions", "section": "2026 franchise minimum and income-tax minimum" }, { "label": "Mississippi DOR: corporate income/franchise FAQ, 2026 rate and inactive filing", "url": "https://dor.ms.gov/business/business-tax-frequently-asked-questions", "checked": "2026-10-11", "section": "Mississippi DOR: corporate income/franchise FAQ, 2026 rate and inactive filing" }, { "label": "Mississippi DOR: corporation-income and franchise-tax statutes and resources", "url": "https://www.dor.ms.gov/business/corporate-income-and-franchise-tax", "checked": "2026-10-11", "section": "Mississippi DOR: corporation-income and franchise-tax statutes and resources" } ] } }, "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" }, { "url": "https://billstatus.ls.state.ms.us/documents/2016/html/SB/2400-2499/SB2483SG.htm", "section": "\u00a779-4-2.02(b)(4), enrolled SB2483 (2016 ch.435)" }, { "url": "https://legiscan.com/MS/text/SB2483/2016", "section": "Mirror of enrolled legislative primary text; Governor approval April 18, 2016" }, { "url": "https://www.sos.ms.gov/content/documents/Business/Services%20%26%20Fees%20Document.pdf", "section": "Corporate report fees" }, { "url": "https://dor.ms.gov/business/business-tax-frequently-asked-questions", "section": "2026 franchise minimum and income-tax minimum" }, { "label": "Mississippi DOR: corporate income/franchise FAQ, 2026 rate and inactive filing", "url": "https://dor.ms.gov/business/business-tax-frequently-asked-questions", "checked": "2026-10-11", "section": "Mississippi DOR: corporate income/franchise FAQ, 2026 rate and inactive filing" }, { "label": "Mississippi DOR: corporation-income and franchise-tax statutes and resources", "url": "https://www.dor.ms.gov/business/corporate-income-and-franchise-tax", "checked": "2026-10-11", "section": "Mississippi DOR: corporation-income and franchise-tax statutes and resources" } ], "differences": [ "Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a779-4-8.33 and intentional criminal-law violations. Officer indemnification is a separate mechanism; this articles provision does not grant officer exculpation.", "October 2024 official fee schedule: corporate annual report $25.", "The form-availability gap is the only shared grouping; ordinary protections and charges differ." ], "gaps": [ "Ordinary charter protections concern specified internal monetary claims; personally committed wrongs and liabilities imposed by other statutes remain separate." ], "confidence": "Current fee source; official ordinary-code verification where stated", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 0, 0 ], "reason": "No dedicated for-profit benefit form identified. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Mississippi has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason. A nonprofit public-benefit corporation is a different entity and does not fill this for-profit gap.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 6, 6 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Mississippi has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a779-4-8.33 and intentional criminal-law violations. Officer indemnification is a separate mechanism; this articles provision does not grant officer exculpation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Mississippi does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Mississippi requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Mississippi has no separately credited benefit-specific monetary shield for company. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Mississippi has no separately credited benefit-specific monetary shield for directors. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Mississippi has no separately credited benefit-specific monetary shield for officers. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 0, 0 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Mississippi: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Mississippi: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Mississippi: No dedicated form. No dedicated benefit form means this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Mississippi has no dedicated benefit form, so this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $25 + benefit filing $0 = $25 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Mississippi has a compared recurring floor of $50 per year, including $25 in identified minimum tax/license charges. Small active domestic C corporation in a regular 2026 tax year, no taxable profit and a capital/property computation at or below the $25 franchise minimum. Annual registry reporting is separate. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Mississippi: becoming a benefit company requires No dedicated for-profit benefit election applies. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Mississippi: changing back requires not_applicable. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Mississippi has no dedicated benefit-report rule in this ordinary form, so it receives no benefit-publication credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Mississippi: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Mississippi: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Mississippi has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 25, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "not_applicable", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 50, "minimumTaxAnnualized": 25, "entryCategory": "not_applicable" }, "grouping": { "assessment": "No dedicated form", "cadence": "No dedicated form", "filing": "No dedicated form", "ordinaryScope": "Director scope only", "exit": "No dedicated form" }, "scoreRange": [ 21, 21 ], "tax": { "code": "MS", "incomeSummary": "Mississippi corporate income tax is 0% on the first $5,000 of taxable income, 4% on the next $5,000, and 5% above $10,000. There is no minimum corporate income tax; the state's corporate franchise minimum is separate.", "recurringSummary": "For a tax year beginning in 2026, franchise tax is $0.50 per $1,000 or fraction on the applicable capital/property base, with the stated $100,000 capital exclusion and a $25 minimum. It falls to $0.25 per $1,000 for 2027 and is scheduled for repeal in 2028. Domestic or qualified inactive corporations still file.", "formationAnnualTaxFloor": 25, "floorBasis": "2026 $25 franchise minimum for an ordinary nonexempt incorporated/domesticated corporation, payable annually while it remains incorporated or doing business. Income tax has no minimum. Excludes annual registry costs and other operating taxes; capital/property can make franchise tax higher.", "scenarioMinimum": 25, "scenarioBasis": "Small active domestic C corporation in a regular 2026 tax year, no taxable profit and a capital/property computation at or below the $25 franchise minimum. Annual registry reporting is separate.", "operatingTaxCaution": "DOR requires corporations doing business, earning income or existing in Mississippi to file, including inactive domestic or qualified corporations. Capital employed and assessed Mississippi property can produce franchise tax without profit; the franchise base is not simply the income-tax base.", "sources": [ { "label": "Mississippi DOR: corporate income/franchise FAQ, 2026 rate and inactive filing", "url": "https://dor.ms.gov/business/business-tax-frequently-asked-questions", "checked": "2026-10-11", "section": "Mississippi DOR: corporate income/franchise FAQ, 2026 rate and inactive filing" }, { "label": "Mississippi DOR: corporation-income and franchise-tax statutes and resources", "url": "https://www.dor.ms.gov/business/corporate-income-and-franchise-tax", "checked": "2026-10-11", "section": "Mississippi DOR: corporation-income and franchise-tax statutes and resources" } ] }, "conversion": { "state": "Mississippi", "code": "MS", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "group": "gap", "groupLabel": "Enact a benefit option", "entryVote": "No dedicated for-profit benefit election applies", "route": "No same-state benefit-status amendment route identified; a benefit chapter is needed. A move to another jurisdiction requires its own authorized domestication, conversion or merger route.", "currentDetail": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "proposal": "Enact a for-profit benefit chapter with a same-company amendment route, ordinary amendment voting and usable agency forms.", "sources": [ { "url": "https://www.sos.ms.gov/publications-external-affairs/mississippi-law", "section": "Title 79; public/nonprofit PBC references are different" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "difference": "Mississippi has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a779-4-8.33 and intentional criminal-law violations. Officer indemnification is a separate mechanism; this articles provision does not grant officer exculpation. Benefit-specific rule: No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "difference": "Mississippi keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a779-4-8.33 and intentional criminal-law violations. Officer indemnification is a separate mechanism; this articles provision does not grant officer exculpation." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Assessment rule: No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "difference": "No benefit reporting credit applies because this state does not offer the requested form; that does not mean an ordinary company has no filings." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $25 per year on an annualized basis. Minimum tax/license used here: $25. Small active domestic C corporation in a regular 2026 tax year, no taxable profit and a capital/property computation at or below the $25 franchise minimum. Annual registry reporting is separate.", "difference": "Mississippi has a compared recurring floor of $50 per year, including $25 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: No dedicated for-profit benefit election applies. Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules. Changing back: not_applicable", "difference": "No direct benefit-status election or exit exists in this state; an interstate move or a law change is a different process." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute. Disclosure: No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Enforcement: No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "difference": "The ordinary corporation has no dedicated statutory benefit duty/report in this reviewed form. That is why it receives no benefit-accountability credit." } } }, "guideUrl": "/assets/state-guides/MS.md" }, { "state": "Missouri", "abbreviation": "MO", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "reviewed": "2026-10-11", "family": "no dedicated form identified", "features": { "purpose": { "summary": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ], "generalRequired": null, "specificRequired": null, "specificOptional": null }, "board": { "summary": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ], "mode": "ordinary_corporation" }, "standard": { "summary": "No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ], "thirdPartyRequired": null, "certificationRequired": null }, "report": { "summary": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ], "cadence": "not_applicable", "shareholders": null, "publicWebsite": null, "stateFiling": null, "public": null }, "enforcement": { "summary": "No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ], "shareholderThreshold": "No dedicated benefit proceeding" }, "benefitLiability": { "summary": "No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "Director-only opt-in charter limitation; exceptions include loyalty, subjective bad faith, misconduct, knowing illegality, unlawful distributions and improper benefit. Particularized pleading and a discovery stay pending dismissal review apply.", "sources": [ { "url": "https://revisor.mo.gov/main/OneSection.aspx?section=351.055", "section": "\u00a7351.055(2)(3)" } ], "director": true, "officer": false, "automatic": false }, "statusChange": { "summary": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ], "entryVote": "not_applicable", "exitVote": "not_applicable", "optionalLock": false } }, "costs": { "regularReport": { "amount": 20, "cadence": "annual", "conditions": "Online $20 annual or $40 biennial; paper $45 or $90.", "summary": "Online $20 annual or $40 biennial; paper $45 or $90.", "sources": [ { "url": "https://www.sos.mo.gov/business/corporations/fees", "section": "Corporate report fees" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate statutory benefit form/report identified.", "summary": "No separate statutory benefit form/report identified.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ] }, "minimumTax": { "amount": null, "conditions": "Corporate income tax is 4% of Missouri taxable income for tax years 2020 onward. A C corporation with a federal filing requirement and $100 or more gross income from Missouri sources generally registers/files. The amount follows income and apportionment, rather than being added as a universal flat registry fee.", "summary": "Corporate income tax is 4% of Missouri taxable income for tax years 2020 onward. A C corporation with a federal filing requirement and $100 or more gross income from Missouri sources generally registers/files. The amount follows income and apportionment, rather than being added as a universal flat registry fee.", "sources": [ { "url": "https://dor.mo.gov/faq/taxation/business/corporation-income.html", "section": "Corporate income tax rate and apportionment" }, { "label": "Missouri Revenue: corporate income rate, modifications, and receipts-factor apportionment", "url": "https://dor.mo.gov/faq/taxation/business/corporation-income.html", "checked": "2026-10-11", "section": "Missouri Revenue: corporate income rate, modifications, and receipts-factor apportionment" }, { "label": "Missouri Revisor: RSMo 147.010(1)(5), no ordinary franchise tax from 2016", "url": "https://revisor.mo.gov/main/OneSection.aspx?section=147.010", "checked": "2026-10-11", "section": "Missouri Revisor: RSMo 147.010(1)(5), no ordinary franchise tax from 2016" } ] } }, "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" }, { "url": "https://revisor.mo.gov/main/OneSection.aspx?section=351.055", "section": "\u00a7351.055(2)(3)" }, { "url": "https://www.sos.mo.gov/business/corporations/fees", "section": "Corporate report fees" }, { "url": "https://dor.mo.gov/faq/taxation/business/corporation-income.html", "section": "Corporate income tax rate and apportionment" }, { "label": "Missouri Revenue: corporate income rate, modifications, and receipts-factor apportionment", "url": "https://dor.mo.gov/faq/taxation/business/corporation-income.html", "checked": "2026-10-11", "section": "Missouri Revenue: corporate income rate, modifications, and receipts-factor apportionment" }, { "label": "Missouri Revisor: RSMo 147.010(1)(5), no ordinary franchise tax from 2016", "url": "https://revisor.mo.gov/main/OneSection.aspx?section=147.010", "checked": "2026-10-11", "section": "Missouri Revisor: RSMo 147.010(1)(5), no ordinary franchise tax from 2016" } ], "differences": [ "Director-only opt-in charter limitation; exceptions include loyalty, subjective bad faith, misconduct, knowing illegality, unlawful distributions and improper benefit. Particularized pleading and a discovery stay pending dismissal review apply.", "Online $20 annual or $40 biennial; paper $45 or $90.", "The form-availability gap is the only shared grouping; ordinary protections and charges differ." ], "gaps": [ "Ordinary charter protections concern specified internal monetary claims; personally committed wrongs and liabilities imposed by other statutes remain separate." ], "confidence": "Current fee source; official ordinary-code verification where stated", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 0, 0 ], "reason": "No dedicated for-profit benefit form identified. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Missouri has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason. A nonprofit public-benefit corporation is a different entity and does not fill this for-profit gap.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 6, 6 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Missouri has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only opt-in charter limitation; exceptions include loyalty, subjective bad faith, misconduct, knowing illegality, unlawful distributions and improper benefit. Particularized pleading and a discovery stay pending dismissal review apply.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Missouri does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Missouri requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Missouri has no separately credited benefit-specific monetary shield for company. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Missouri has no separately credited benefit-specific monetary shield for directors. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Missouri has no separately credited benefit-specific monetary shield for officers. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 0, 0 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Missouri: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Missouri: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Missouri: No dedicated form. No dedicated benefit form means this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Missouri has no dedicated benefit form, so this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $20 + benefit filing $0 = $20 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Missouri has a compared recurring floor of $20 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation operating in Missouri with zero Missouri taxable income after state modifications: $0 corporate income tax, with no ordinary franchise minimum. Excludes report fees and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Missouri: becoming a benefit company requires No dedicated for-profit benefit election applies. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Missouri: changing back requires not_applicable. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Missouri has no dedicated benefit-report rule in this ordinary form, so it receives no benefit-publication credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Missouri: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Missouri: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Missouri has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 20, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "not_applicable", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 20, "minimumTaxAnnualized": 0, "entryCategory": "not_applicable" }, "grouping": { "assessment": "No dedicated form", "cadence": "No dedicated form", "filing": "No dedicated form", "ordinaryScope": "Director scope only", "exit": "No dedicated form" }, "scoreRange": [ 21, 21 ], "tax": { "code": "MO", "incomeSummary": "Missouri ordinary C-corporation income tax is a flat 4% of Missouri taxable income for tax years 2020 and later.", "recurringSummary": "The ordinary corporation franchise tax is no longer imposed for tax years beginning on or after January 1, 2016. No surviving general fixed franchise/capital minimum applies to the ordinary civic/technology C corporation. Corporate registration-report charges remain separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive annual tax solely from ordinary domestic stock-corporation status: the franchise tax ended, and income tax follows Missouri taxable income. Registry fees and specialized industry taxes are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation operating in Missouri with zero Missouri taxable income after state modifications: $0 corporate income tax, with no ordinary franchise minimum. Excludes report fees and other operating taxes.", "operatingTaxCaution": "Missouri taxable income starts with federal taxable income and state modifications, followed by applicable allocation/apportionment. Multistate corporations generally use the receipts factor for business income; nonapportionable income requires separate support. Corporate filing and registration duties can remain even when the tax computation is zero.", "sources": [ { "label": "Missouri Revenue: corporate income rate, modifications, and receipts-factor apportionment", "url": "https://dor.mo.gov/faq/taxation/business/corporation-income.html", "checked": "2026-10-11", "section": "Missouri Revenue: corporate income rate, modifications, and receipts-factor apportionment" }, { "label": "Missouri Revisor: RSMo 147.010(1)(5), no ordinary franchise tax from 2016", "url": "https://revisor.mo.gov/main/OneSection.aspx?section=147.010", "checked": "2026-10-11", "section": "Missouri Revisor: RSMo 147.010(1)(5), no ordinary franchise tax from 2016" } ] }, "conversion": { "state": "Missouri", "code": "MO", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "group": "gap", "groupLabel": "Enact a benefit option", "entryVote": "No dedicated for-profit benefit election applies", "route": "No same-state benefit-status amendment route identified; a benefit chapter is needed. A move to another jurisdiction requires its own authorized domestication, conversion or merger route.", "currentDetail": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "proposal": "Enact a for-profit benefit chapter with a same-company amendment route, ordinary amendment voting and usable agency forms.", "sources": [ { "url": "https://revisor.mo.gov/main/OneChapter.aspx?chapter=351", "section": "RSMo Chapter 351; nonprofit PBC under Chapter 355" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "difference": "Missouri has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only opt-in charter limitation; exceptions include loyalty, subjective bad faith, misconduct, knowing illegality, unlawful distributions and improper benefit. Particularized pleading and a discovery stay pending dismissal review apply. Benefit-specific rule: No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "difference": "Missouri keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Director-only opt-in charter limitation; exceptions include loyalty, subjective bad faith, misconduct, knowing illegality, unlawful distributions and improper benefit. Particularized pleading and a discovery stay pending dismissal review apply." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Assessment rule: No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "difference": "No benefit reporting credit applies because this state does not offer the requested form; that does not mean an ordinary company has no filings." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $20 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation operating in Missouri with zero Missouri taxable income after state modifications: $0 corporate income tax, with no ordinary franchise minimum. Excludes report fees and other operating taxes.", "difference": "Missouri has a compared recurring floor of $20 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: No dedicated for-profit benefit election applies. Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules. Changing back: not_applicable", "difference": "No direct benefit-status election or exit exists in this state; an interstate move or a law change is a different process." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute. Disclosure: No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Enforcement: No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "difference": "The ordinary corporation has no dedicated statutory benefit duty/report in this reviewed form. That is why it receives no benefit-accountability credit." } } }, "guideUrl": "/assets/state-guides/MO.md" }, { "state": "Montana", "abbreviation": "MT", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "general-benefit model with any-shareholder enforcement and fee shifting", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a charter may add specific public benefits.", "sources": [ { "id": "MT-purpose", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0030/0350-0010-0140-0030.html", "section": "\u00a735-1-1403", "claims": [ "General benefit and optional specific benefit" ] } ] }, "board": { "model": "mandatory_stakeholder_consideration", "summary": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "sources": [ { "id": "MT-directors", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0060/0350-0010-0140-0060.html", "section": "\u00a735-1-1406", "claims": [ "Mandatory consideration, compliance-conditioned director damages shield" ] } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Annual report assesses general benefit against an independent third-party standard. The act does not mandate paid private certification.", "sources": [ { "id": "MT-report", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0100/0350-0010-0140-0100.html", "section": "\u00a735-1-1410", "claims": [ "Annual public/shareholder report and third-party standard" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "deadline": "Within 120 days after fiscal year end or when another annual shareholder report is delivered.", "redactions": "Director compensation and financial/proprietary information may be omitted publicly.", "summary": "Annual shareholder report and all public website reports or free copies on request; no separate state benefit-report filing identified.", "sources": [ { "id": "MT-report", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0100/0350-0010-0140-0100.html", "section": "\u00a735-1-1410", "claims": [ "Annual public/shareholder report and third-party standard" ] } ] }, "enforcement": { "threshold": "Any shareholder; director; at least 5% parent equity owner; other persons named in articles.", "summary": "Any shareholder can bring benefit enforcement; a court may award plaintiff costs and attorney fees for unjustified noncompliance.", "sources": [ { "id": "MT-enforcement", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0120/0350-0010-0140-0120.html", "section": "\u00a735-1-1412", "claims": [ "Any-shareholder standing, company damages shield, plaintiff fee shifting" ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to create benefit.", "directors": "Shield for alleged director-duty or benefit-failure claims is conditioned on performing director duties in accordance with the benefit part.", "officers": "Compliant conduct and benefit-failure monetary shield under \u00a735-1-1409.", "summary": "Director benefit-failure protection has an express compliance condition; enforcement has no shareholder ownership floor and may shift fees.", "sources": [ { "id": "MT-directors", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0060/0350-0010-0140-0060.html", "section": "\u00a735-1-1406", "claims": [ "Mandatory consideration, compliance-conditioned director damages shield" ] }, { "id": "MT-officers", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0090/0350-0010-0140-0090.html", "section": "\u00a735-1-1409", "claims": [ "Officer monetary shield" ] }, { "id": "MT-enforcement", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0120/0350-0010-0140-0120.html", "section": "\u00a735-1-1412", "claims": [ "Any-shareholder standing, company damages shield, plaintiff fee shifting" ] } ] }, "ordinaryExculpation": { "scope": "directors", "activation": "Opt-in articles.", "exceptions": [ "Improper financial benefit", "Intentional infliction of harm", "Specified unlawful distributions", "Intentional criminal-law violation", "Acts before the provision becomes effective" ], "summary": "Ordinary director charter exculpation under \u00a735-14-202(2)(d), with improper benefit, intentional harm, unlawful distribution and intentional criminal exceptions.", "sources": [ { "id": "MT-ordinary", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0140/part_0020/section_0020/0350-0140-0020-0020.html", "section": "\u00a735-14-202(2)(d)", "claims": [ "Director charter exculpation" ] } ] }, "statusChange": { "entryVote": "Two thirds of every class/series, including nonvoting shares.", "exitVote": "Same minimum status vote.", "lock": "Entry/exit and specified major transactions give shareholders fair-market-value purchase rights under ordinary appraisal procedures.", "summary": "Two-thirds class mission/status protection plus specified dissenting-shareholder purchase rights.", "sources": [ { "id": "MT-votes", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0020/0350-0010-0140-0020.html", "section": "\u00a735-1-1402", "claims": [ "Two-thirds every-class minimum status vote" ] }, { "id": "MT-entry", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0070/0350-0010-0140-0070.html", "section": "\u00a735-1-1407", "claims": [ "Entry votes and fair-market-value purchase right" ] }, { "id": "MT-exit", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0080/0350-0010-0140-0080.html", "section": "\u00a735-1-1408", "claims": [ "Exit votes and purchase rights" ] } ] } }, "costs": { "regularReport": { "amount": 0, "cadence": "annual", "conditions": "On-time Jan. 1\u2013Apr. 15 filing fee waived for 2026; official announcement also waives 2027. This is a dated waiver, not a permanent statutory zero.", "summary": "On-time Jan. 1\u2013Apr. 15 filing fee waived for 2026; official announcement also waives 2027. This is a dated waiver, not a permanent statutory zero.", "sources": [ { "id": "MT-waiver", "url": "https://sosmt.gov/secretary-christi-jacobsen-continues-montana-business-support-by-waiving-fees-once-again/", "section": "2026/2027 Secretary of State fee-waiver announcement", "claims": [ "On-time annual filing fees waived" ] }, { "id": "MT-current-fee", "url": "https://help.sosmt.gov/en-us/article/why-didnt-i-receive-a-receipt-for-my-annual-report-apzs5a/", "section": "Aug. 4, 2026 help article", "claims": [ "On-time 2026 reports have no fee" ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate state benefit-report filing identified.", "summary": "No separate state benefit-report filing identified.", "sources": [ { "id": "MT-report", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0100/0350-0010-0140-0100.html", "section": "\u00a735-1-1410", "claims": [ "Annual public/shareholder report and third-party standard" ] } ] }, "minimumTax": { "amount": 50, "cadence": "annual", "conditions": "Corporate income-tax minimum is $50 for C corporations subject to Montana corporate income taxation, generally corporations doing business in Montana. Income-based tax may exceed it. If there is no business activity the agency permits an affidavit of inactivity; benefit status itself creates no exemption.", "summary": "Corporate income-tax minimum is $50 for C corporations subject to Montana corporate income taxation, generally corporations doing business in Montana. Income-based tax may exceed it. If there is no business activity the agency permits an affidavit of inactivity; benefit status itself creates no exemption.", "sources": [ { "id": "MT-tax-applicability", "url": "https://www.revenue.mt.gov/taxes/corporate-income-tax", "section": "Corporate tax rates, minimum, filing and inactivity; MCA\u00a7\u00a715-31-121\u2013122", "claims": [ "$50 minimum corporate income tax for corporations subject to tax; Montana business-activity and inactivity rules." ] }, { "label": "Montana DOR, corporate income tax: 6.75%, 7%, 0.5%, $50 and inactivity", "url": "https://www.revenue.mt.gov/taxes/corporate-income-tax", "checked": "2026-10-11", "section": "Montana DOR, corporate income tax: 6.75%, 7%, 0.5%, $50 and inactivity" }, { "label": "Montana DOR, 2025 Form CIT instructions: minimum per corporation with activity and alternative tax", "url": "https://revenue.mt.gov/files/Forms/Montana-Form-CIT-Instructions/2025_Montana_Form_CIT_Instructions.pdf", "checked": "2026-10-11", "section": "Montana DOR, 2025 Form CIT instructions: minimum per corporation with activity and alternative tax" } ] } }, "sources": [ { "id": "MT-purpose", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0030/0350-0010-0140-0030.html", "section": "\u00a735-1-1403", "claims": [ "General benefit and optional specific benefit" ] }, { "id": "MT-votes", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0020/0350-0010-0140-0020.html", "section": "\u00a735-1-1402", "claims": [ "Two-thirds every-class minimum status vote" ] }, { "id": "MT-directors", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0060/0350-0010-0140-0060.html", "section": "\u00a735-1-1406", "claims": [ "Mandatory consideration, compliance-conditioned director damages shield" ] }, { "id": "MT-entry", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0070/0350-0010-0140-0070.html", "section": "\u00a735-1-1407", "claims": [ "Entry votes and fair-market-value purchase right" ] }, { "id": "MT-exit", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0080/0350-0010-0140-0080.html", "section": "\u00a735-1-1408", "claims": [ "Exit votes and purchase rights" ] }, { "id": "MT-officers", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0090/0350-0010-0140-0090.html", "section": "\u00a735-1-1409", "claims": [ "Officer monetary shield" ] }, { "id": "MT-report", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0100/0350-0010-0140-0100.html", "section": "\u00a735-1-1410", "claims": [ "Annual public/shareholder report and third-party standard" ] }, { "id": "MT-enforcement", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0120/0350-0010-0140-0120.html", "section": "\u00a735-1-1412", "claims": [ "Any-shareholder standing, company damages shield, plaintiff fee shifting" ] }, { "id": "MT-ordinary", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0140/part_0020/section_0020/0350-0140-0020-0020.html", "section": "\u00a735-14-202(2)(d)", "claims": [ "Director charter exculpation" ] }, { "id": "MT-waiver", "url": "https://sosmt.gov/secretary-christi-jacobsen-continues-montana-business-support-by-waiving-fees-once-again/", "section": "2026/2027 Secretary of State fee-waiver announcement", "claims": [ "On-time annual filing fees waived" ] }, { "id": "MT-current-fee", "url": "https://help.sosmt.gov/en-us/article/why-didnt-i-receive-a-receipt-for-my-annual-report-apzs5a/", "section": "Aug. 4, 2026 help article", "claims": [ "On-time 2026 reports have no fee" ] }, { "id": "MT-tax-applicability", "url": "https://www.revenue.mt.gov/taxes/corporate-income-tax", "section": "Corporate tax rates, minimum, filing and inactivity; MCA\u00a7\u00a715-31-121\u2013122", "claims": [ "$50 minimum corporate income tax for corporations subject to tax; Montana business-activity and inactivity rules." ] }, { "label": "Montana DOR, corporate income tax: 6.75%, 7%, 0.5%, $50 and inactivity", "url": "https://www.revenue.mt.gov/taxes/corporate-income-tax", "checked": "2026-10-11", "section": "Montana DOR, corporate income tax: 6.75%, 7%, 0.5%, $50 and inactivity" }, { "label": "Montana DOR, 2025 Form CIT instructions: minimum per corporation with activity and alternative tax", "url": "https://revenue.mt.gov/files/Forms/Montana-Form-CIT-Instructions/2025_Montana_Form_CIT_Instructions.pdf", "checked": "2026-10-11", "section": "Montana DOR, 2025 Form CIT instructions: minimum per corporation with activity and alternative tax" } ], "differences": [ "Any-shareholder benefit enforcement and potential plaintiff fee awards increase accountability.", "Director benefit-failure shield expressly depends on compliance with the benefit part.", "Ordinary corporate code was recodified as Chapter 14; benefit rules remain Chapter 1 Part 14.", "Annual filing-cost advantage is a dated waiver." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "2025 official MCA compilation reviewed; report-fee waiver verified for 2026 and announced for 2027." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Montana offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Montana has an identified director monetary-protection provision in the compared scope, which earns this credit. Ordinary director charter exculpation under \u00a735-14-202(2)(d), with improper benefit, intentional harm, unlawful distribution and intentional criminal exceptions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Montana does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Montana requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Montana earns the benefit-specific credit for company. Director benefit-failure protection has an express compliance condition; enforcement has no shareholder ownership floor and may shift fees.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Montana earns the benefit-specific credit for directors. Director benefit-failure protection has an express compliance condition; enforcement has no shareholder ownership floor and may shift fees.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Montana earns the benefit-specific credit for officers. Director benefit-failure protection has an express compliance condition; enforcement has no shareholder ownership floor and may shift fees.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Montana: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Montana: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Montana: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Montana has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $0 = $0 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Montana has a compared recurring floor of $50 per year, including $50 in identified minimum tax/license charges. Ordinary domestic C corporation operating in Montana, no taxable profit, standard tax method and no special exception/credit. Includes $50 minimum; excludes registry fees and variable tax. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Two-thirds class mission/status protection plus specified dissenting-shareholder purchase rights.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Montana: becoming a benefit company requires Two thirds of every class/series, including nonvoting shares. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Montana: changing back requires Same minimum status vote. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Montana requires report access for people outside the company, so it earns public-access credit. Annual shareholder report and all public website reports or free copies on request; no separate state benefit-report filing identified.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Montana: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Montana: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Montana makes a mission duty mandatory, so it earns this credit. Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 0, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 50, "minimumTaxAnnualized": 50, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 79, 79 ], "tax": { "code": "MT", "incomeSummary": "General corporate income tax is 6.75% of Montana taxable income with a $50 minimum for corporations having Montana activity. A water's-edge election uses 7%; a qualifying sales-only corporation can elect a 0.5% gross-sales alternative.", "recurringSummary": "The $50 corporate minimum applies to ordinary C corporations with Montana activity, including loss years. The agency permits an affidavit of inactivity when there is no business activity; formation alone is not modeled as an unavoidable $50 charge.", "formationAnnualTaxFloor": null, "floorBasis": "The sourced $50 is an activity-based corporate minimum, subject to the qualifying gross-sales alternative, rather than an unconditional incorporation-only floor. Registry fees are excluded.", "scenarioMinimum": 50, "scenarioBasis": "Ordinary domestic C corporation operating in Montana, no taxable profit, standard tax method and no special exception/credit. Includes $50 minimum; excludes registry fees and variable tax.", "operatingTaxCaution": "Montana business activity and nexus determine filing. Multistate allocation/apportionment and combined reporting matter; the gross-sales alternative has sales-only, property and receipts conditions.", "sources": [ { "label": "Montana DOR, corporate income tax: 6.75%, 7%, 0.5%, $50 and inactivity", "url": "https://www.revenue.mt.gov/taxes/corporate-income-tax", "checked": "2026-10-11", "section": "Montana DOR, corporate income tax: 6.75%, 7%, 0.5%, $50 and inactivity" }, { "label": "Montana DOR, 2025 Form CIT instructions: minimum per corporation with activity and alternative tax", "url": "https://revenue.mt.gov/files/Forms/Montana-Form-CIT-Instructions/2025_Montana_Form_CIT_Instructions.pdf", "checked": "2026-10-11", "section": "Montana DOR, 2025 Form CIT instructions: minimum per corporation with activity and alternative tax" } ] }, "conversion": { "state": "Montana", "code": "MT", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "Two thirds of every class/series, including nonvoting shares.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Two-thirds class mission/status protection plus specified dissenting-shareholder purchase rights.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "id": "MT-votes", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0020/0350-0010-0140-0020.html", "section": "\u00a735-1-1402", "claims": [ "Two-thirds every-class minimum status vote" ] }, { "id": "MT-entry", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0070/0350-0010-0140-0070.html", "section": "\u00a735-1-1407", "claims": [ "Entry votes and fair-market-value purchase right" ] }, { "id": "MT-exit", "url": "https://mca.legmt.gov/bills/mca/title_0350/chapter_0010/part_0140/section_0080/0350-0010-0140-0080.html", "section": "\u00a735-1-1408", "claims": [ "Exit votes and purchase rights" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a charter may add specific public benefits.", "difference": "Montana offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Ordinary director charter exculpation under \u00a735-14-202(2)(d), with improper benefit, intentional harm, unlawful distribution and intentional criminal exceptions. Benefit-specific rule: Director benefit-failure protection has an express compliance condition; enforcement has no shareholder ownership floor and may shift fees.", "difference": "Montana keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Director benefit-failure shield expressly depends on compliance with the benefit part." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder report and all public website reports or free copies on request; no separate state benefit-report filing identified. Assessment rule: Annual report assesses general benefit against an independent third-party standard. The act does not mandate paid private certification.", "difference": "Montana: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $0 per year on an annualized basis. Minimum tax/license used here: $50. Ordinary domestic C corporation operating in Montana, no taxable profit, standard tax method and no special exception/credit. Includes $50 minimum; excludes registry fees and variable tax.", "difference": "Montana has a compared recurring floor of $50 per year, including $50 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Two thirds of every class/series, including nonvoting shares. Two-thirds class mission/status protection plus specified dissenting-shareholder purchase rights. Changing back: Same minimum status vote.", "difference": "Montana entry uses Two thirds of every class/series, including nonvoting shares.; exit uses Same minimum status vote.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities. Disclosure: Annual shareholder report and all public website reports or free copies on request; no separate state benefit-report filing identified. Enforcement: Any shareholder can bring benefit enforcement; a court may award plaintiff costs and attorney fees for unjustified noncompliance.", "difference": "Montana requires public access to the report. Any-shareholder benefit enforcement and potential plaintiff fee awards increase accountability." } } }, "guideUrl": "/assets/state-guides/MT.md" }, { "state": "Nebraska", "abbreviation": "NE", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit mandatory stakeholder model; state-filed annual report", "features": { "purpose": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-407", "section": "Neb. Rev. Stat. 21-407" } ], "confidence": "high", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit mandatory; specific public benefits optional." }, "board": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-408", "section": "Neb. Rev. Stat. 21-408" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-409", "section": "Neb. Rev. Stat. 21-409" } ], "confidence": "high", "mode": "mandatory_stakeholder_consideration", "summary": "Shall consider listed stakeholders; priority optional in articles. Independent benefit director mandatory only for publicly traded corporations, optional otherwise." }, "standard": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-413", "section": "Neb. Rev. Stat. 21-413" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-413", "section": "Neb. Rev. Stat. 21-413" } ], "confidence": "high", "required": true, "summary": "Annual social/environmental assessment against third-party standard required. No report/assessment audit or certification required.", "thirdPartyRequired": true, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-413", "section": "Neb. Rev. Stat. 21-413" } ], "confidence": "high", "required": false, "summary": "No report/assessment audit or certification required." }, "report": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-414", "section": "Neb. Rev. Stat. 21-414" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": true, "summary": "Annual shareholder report within 120 days/year-end or other annual report delivery; all reports public website/latest free copy; concurrently state-filed. Specified compensation/proprietary information may be redacted." }, "enforcement": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-412", "section": "Neb. Rev. Stat. 21-412" } ], "confidence": "high", "threshold": "2% class/series at act", "summary": "Company directly; derivative 2% class/series holders at challenged act, director, 5% parent, or charter/bylaw designees." }, "benefitLiability": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-408", "section": "Neb. Rev. Stat. 21-408" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-409", "section": "Neb. Rev. Stat. 21-409" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-410", "section": "Neb. Rev. Stat. 21-410" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-412", "section": "Neb. Rev. Stat. 21-412" } ], "confidence": "high", "company": true, "directors": true, "officers": true, "summary": "Company money damages barred under benefit Act for benefit failure. Directors and officers have compliant-conduct and benefit-failure monetary protection unless articles/bylaws say otherwise; benefit-director exceptions include self-dealing/willful misconduct/known illegality." }, "ordinaryExculpation": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-220", "section": "Neb. Rev. Stat. 21-220" } ], "confidence": "high", "director": true, "officer": false, "optIn": true, "summary": "Director-only charter monetary limitation; improper financial benefit, intentional harm, unlawful distributions, intentional criminal violation excepted.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-403", "section": "Neb. Rev. Stat. 21-403" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-405", "section": "Neb. Rev. Stat. 21-405" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-406", "section": "Neb. Rev. Stat. 21-406" } ], "confidence": "high", "entry": "2/3 each class/series", "exit": "2/3 each class/series", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "2/3 every class/series including nonvoting for entry/exit and covered nonordinary asset sale, plus other required votes.", "exitVote": "2/3 each class/series", "entryVote": "2/3 each class/series" } }, "costs": { "regularReport": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-301", "section": "Neb. Rev. Stat. 21-301: report and occupation tax" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-303", "section": "Neb. Rev. Stat. 21-303: occupation tax for filing report" }, { "url": "https://www.nebraska.gov/corp_filing/filing/tax_report/domestic_tax_schedule.html", "section": "State online domestic corporation tax-report schedule" }, { "url": "https://sos.nebraska.gov/business-services/forms-and-fee-information", "section": "Original report not separately priced; amendment/correction $30" } ], "confidence": "high", "amount": 0, "cadence": "biennial", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No separate original biennial corporation report filing charge: the required reporting payment is the occupation tax under 21-301/21-303, minimum $26 in each even year for paid-up capital at most $10,000. It is classified under occupation tax below and counted once. The agency online tax-report schedule reproduces exactly those occupation-tax tiers. The $30 biennial-report amendment/correction fee applies only to amendments, not the original report.", "conditions": "No separate original biennial corporation report filing charge: the required reporting payment is the occupation tax under 21-301/21-303, minimum $26 in each even year for paid-up capital at most $10,000. It is classified under occupation tax below and counted once. The agency online tax-report schedule reproduces exactly those occupation-tax tiers. The $30 biennial-report amendment/correction fee applies only to amendments, not the original report." }, "benefitReport": { "sources": [ { "url": "https://sos.nebraska.gov/business-services/forms-and-fee-information", "section": "Domestic business corporation / benefit report" } ], "confidence": "high", "amount": 25, "cadence": "annual", "online": 25, "paper": 30, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Separate annual benefit report $25 online/$30 in-office.", "conditions": "Separate annual benefit report $25 online/$30 in-office." }, "minimumTax": { "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-303", "section": "Neb. Rev. Stat. 21-303" }, { "label": "Nebraska Revenue: 2026 corporation estimated-income-tax rate", "url": "https://revenue.nebraska.gov/files/doc/tax-forms/2025/f_1120N-ES.pdf", "checked": "2026-10-11", "section": "Nebraska Revenue: 2026 corporation estimated-income-tax rate" }, { "label": "Nebraska Revenue: enacted 2025-2027 corporate rates", "url": "https://revenue.nebraska.gov/sites/default/files/doc/research/Revenue_Sources_2025.pdf", "checked": "2026-10-11", "section": "Nebraska Revenue: enacted 2025-2027 corporate rates" }, { "label": "Nebraska Legislature: section 21-303 domestic occupation-tax schedule and even-year cadence", "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-303", "checked": "2026-10-11", "section": "Nebraska Legislature: section 21-303 domestic occupation-tax schedule and even-year cadence" }, { "label": "Nebraska Revenue: business income tax scope, combined reporting, and sales-only apportionment (rate examples on this FAQ are older)", "url": "https://revenue.nebraska.gov/about/frequently-asked-questions/business-income-tax-faqs", "checked": "2026-10-11", "section": "Nebraska Revenue: business income tax scope, combined reporting, and sales-only apportionment (rate examples on this FAQ are older)" } ], "confidence": "high", "amount": 26, "cadence": "biennial", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Occupation tax minimum $26 each even year for paid-up capital at most $10,000; tiered tax increases above this. No annual $26 claim.", "conditions": "Occupation tax minimum $26 each even year for paid-up capital at most $10,000; tiered tax increases above this. No annual $26 claim." } }, "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-407", "section": "Neb. Rev. Stat. 21-407" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-408", "section": "Neb. Rev. Stat. 21-408" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-409", "section": "Neb. Rev. Stat. 21-409" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-413", "section": "Neb. Rev. Stat. 21-413" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-414", "section": "Neb. Rev. Stat. 21-414" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-412", "section": "Neb. Rev. Stat. 21-412" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-410", "section": "Neb. Rev. Stat. 21-410" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-220", "section": "Neb. Rev. Stat. 21-220" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-403", "section": "Neb. Rev. Stat. 21-403" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-405", "section": "Neb. Rev. Stat. 21-405" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-406", "section": "Neb. Rev. Stat. 21-406" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-301", "section": "Neb. Rev. Stat. 21-301: report and occupation tax" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-303", "section": "Neb. Rev. Stat. 21-303: occupation tax for filing report" }, { "url": "https://www.nebraska.gov/corp_filing/filing/tax_report/domestic_tax_schedule.html", "section": "State online domestic corporation tax-report schedule" }, { "url": "https://sos.nebraska.gov/business-services/forms-and-fee-information", "section": "Original report not separately priced; amendment/correction $30" }, { "url": "https://sos.nebraska.gov/business-services/forms-and-fee-information", "section": "Domestic business corporation / benefit report" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-303", "section": "Neb. Rev. Stat. 21-303" }, { "label": "Nebraska Revenue: 2026 corporation estimated-income-tax rate", "url": "https://revenue.nebraska.gov/files/doc/tax-forms/2025/f_1120N-ES.pdf", "checked": "2026-10-11", "section": "Nebraska Revenue: 2026 corporation estimated-income-tax rate" }, { "label": "Nebraska Revenue: enacted 2025-2027 corporate rates", "url": "https://revenue.nebraska.gov/sites/default/files/doc/research/Revenue_Sources_2025.pdf", "checked": "2026-10-11", "section": "Nebraska Revenue: enacted 2025-2027 corporate rates" }, { "label": "Nebraska Legislature: section 21-303 domestic occupation-tax schedule and even-year cadence", "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-303", "checked": "2026-10-11", "section": "Nebraska Legislature: section 21-303 domestic occupation-tax schedule and even-year cadence" }, { "label": "Nebraska Revenue: business income tax scope, combined reporting, and sales-only apportionment (rate examples on this FAQ are older)", "url": "https://revenue.nebraska.gov/about/frequently-asked-questions/business-income-tax-faqs", "checked": "2026-10-11", "section": "Nebraska Revenue: business income tax scope, combined reporting, and sales-only apportionment (rate examples on this FAQ are older)" } ], "differences": [ "2% of a class enforcement floor, not any shareholder.", "State-filed annual benefit report plus biennial capital-based occupation tax.", "Mandatory independent benefit director only if publicly traded." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Nebraska offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Nebraska has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only charter monetary limitation; improper financial benefit, intentional harm, unlawful distributions, intentional criminal violation excepted.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Nebraska does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Nebraska requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Nebraska earns the benefit-specific credit for company. Company money damages barred under benefit Act for benefit failure. Directors and officers have compliant-conduct and benefit-failure monetary protection unless articles/bylaws say otherwise; benefit-director exceptions include self-dealing/willful misconduct/known illegality.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Nebraska earns the benefit-specific credit for directors. Company money damages barred under benefit Act for benefit failure. Directors and officers have compliant-conduct and benefit-failure monetary protection unless articles/bylaws say otherwise; benefit-director exceptions include self-dealing/willful misconduct/known illegality.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Nebraska earns the benefit-specific credit for officers. Company money damages barred under benefit Act for benefit failure. Directors and officers have compliant-conduct and benefit-failure monetary protection unless articles/bylaws say otherwise; benefit-director exceptions include self-dealing/willful misconduct/known illegality.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Nebraska: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Nebraska: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Nebraska: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Nebraska has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $25 = $25 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Nebraska has a compared recurring floor of $38 per year, including $13 in identified minimum tax/license charges. Small active domestic stock C corporation, paid-up capital at most $10,000 and no Nebraska taxable income: $26 occupation tax each even year, annualized to $13/year for comparison; $0 ordinary income tax. Excludes report fees and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "2/3 every class/series including nonvoting for entry/exit and covered nonordinary asset sale, plus other required votes.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Nebraska: becoming a benefit company requires 2/3 each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Nebraska: changing back requires 2/3 each class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Nebraska requires report access for people outside the company, so it earns public-access credit. Annual shareholder report within 120 days/year-end or other annual report delivery; all reports public website/latest free copy; concurrently state-filed. Specified compensation/proprietary information may be redacted.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Nebraska: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Nebraska: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Nebraska makes a mission duty mandatory, so it earns this credit. Shall consider listed stakeholders; priority optional in articles. Independent benefit director mandatory only for publicly traded corporations, optional otherwise.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 25.0, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 38.0, "minimumTaxAnnualized": 13, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 76, 76 ], "tax": { "code": "NE", "incomeSummary": "For tax years beginning in 2026, Nebraska ordinary corporate income tax is a flat 4.55% of Nebraska taxable income. The enacted rate becomes 3.99% for tax years beginning on or after January 1, 2027; the 2025 rate was 5.20%.", "recurringSummary": "A domestic for-profit corporation registered on January 1 owes a biennial occupation tax in each even-numbered year. The minimum is $26 when paid-up capital stock is at most $10,000; higher capital produces a statutory tiered tax. $26 every two years is $13 per year only as an annualized comparison, not an annual bill. Ordinary income tax and report filing fees are separate.", "formationAnnualTaxFloor": 13, "floorBasis": "Annualized $26 statutory minimum occupation tax every even-numbered year for a regular domestic for-profit stock corporation registered January 1; equivalent $13/year over a two-year cycle. It is not $13 due annually. Excludes registry/report fees, higher capital tiers, and income/operating taxes.", "scenarioMinimum": 13, "scenarioBasis": "Small active domestic stock C corporation, paid-up capital at most $10,000 and no Nebraska taxable income: $26 occupation tax each even year, annualized to $13/year for comparison; $0 ordinary income tax. Excludes report fees and other operating taxes.", "operatingTaxCaution": "Nebraska taxes the Nebraska-source portion of corporate taxable income. Multistate businesses generally use sales-only apportionment and unitary groups file combined returns. Financial-institution franchise tax is a separate industry regime. The occupation tax is a charter/registration obligation and is not eliminated by having no taxable income.", "sources": [ { "label": "Nebraska Revenue: 2026 corporation estimated-income-tax rate", "url": "https://revenue.nebraska.gov/files/doc/tax-forms/2025/f_1120N-ES.pdf", "checked": "2026-10-11", "section": "Nebraska Revenue: 2026 corporation estimated-income-tax rate" }, { "label": "Nebraska Revenue: enacted 2025-2027 corporate rates", "url": "https://revenue.nebraska.gov/sites/default/files/doc/research/Revenue_Sources_2025.pdf", "checked": "2026-10-11", "section": "Nebraska Revenue: enacted 2025-2027 corporate rates" }, { "label": "Nebraska Legislature: section 21-303 domestic occupation-tax schedule and even-year cadence", "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-303", "checked": "2026-10-11", "section": "Nebraska Legislature: section 21-303 domestic occupation-tax schedule and even-year cadence" }, { "label": "Nebraska Revenue: business income tax scope, combined reporting, and sales-only apportionment (rate examples on this FAQ are older)", "url": "https://revenue.nebraska.gov/about/frequently-asked-questions/business-income-tax-faqs", "checked": "2026-10-11", "section": "Nebraska Revenue: business income tax scope, combined reporting, and sales-only apportionment (rate examples on this FAQ are older)" } ] }, "conversion": { "state": "Nebraska", "code": "NE", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 each class/series", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "2/3 every class/series including nonvoting for entry/exit and covered nonordinary asset sale, plus other required votes.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-403", "section": "Neb. Rev. Stat. 21-403" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-405", "section": "Neb. Rev. Stat. 21-405" }, { "url": "https://nebraskalegislature.gov/laws/statutes.php?statute=21-406", "section": "Neb. Rev. Stat. 21-406" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit mandatory; specific public benefits optional.", "difference": "Nebraska offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only charter monetary limitation; improper financial benefit, intentional harm, unlawful distributions, intentional criminal violation excepted. Benefit-specific rule: Company money damages barred under benefit Act for benefit failure. Directors and officers have compliant-conduct and benefit-failure monetary protection unless articles/bylaws say otherwise; benefit-director exceptions include self-dealing/willful misconduct/known illegality.", "difference": "Nebraska keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Mandatory independent benefit director only if publicly traded." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder report within 120 days/year-end or other annual report delivery; all reports public website/latest free copy; concurrently state-filed. Specified compensation/proprietary information may be redacted. Assessment rule: Annual social/environmental assessment against third-party standard required. No report/assessment audit or certification required.", "difference": "Nebraska: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $25 per year on an annualized basis. Minimum tax/license used here: $13. Small active domestic stock C corporation, paid-up capital at most $10,000 and no Nebraska taxable income: $26 occupation tax each even year, annualized to $13/year for comparison; $0 ordinary income tax. Excludes report fees and other operating taxes.", "difference": "Nebraska has a compared recurring floor of $38 per year, including $13 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 each class/series. 2/3 every class/series including nonvoting for entry/exit and covered nonordinary asset sale, plus other required votes. Changing back: 2/3 each class/series", "difference": "Nebraska entry uses 2/3 each class/series; exit uses 2/3 each class/series. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Shall consider listed stakeholders; priority optional in articles. Independent benefit director mandatory only for publicly traded corporations, optional otherwise. Disclosure: Annual shareholder report within 120 days/year-end or other annual report delivery; all reports public website/latest free copy; concurrently state-filed. Specified compensation/proprietary information may be redacted. Enforcement: Company directly; derivative 2% class/series holders at challenged act, director, 5% parent, or charter/bylaw designees.", "difference": "Nebraska requires public access to the report. 2% of a class enforcement floor, not any shareholder. State-filed annual benefit report plus biennial capital-based occupation tax. Mandatory independent benefit director only if publicly traded." } } }, "guideUrl": "/assets/state-guides/NE.md" }, { "state": "Nevada", "abbreviation": "NV", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "general-benefit stakeholder consideration", "features": { "purpose": { "summary": "General public benefit required; specific benefits optional.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.140" } ], "generalRequired": true, "specificRequired": false, "specificOptional": true }, "board": { "summary": "Mandatory consideration of enumerated stakeholders; no automatic priority unless articles prioritize a benefit.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.150" } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "summary": "Independent third-party assessment standard required; paid certification or audit is not.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.170" } ], "thirdPartyRequired": true, "certificationRequired": false }, "report": { "summary": "Annual shareholder report, generally within 120 days; public website or free copies on request. Permitted financial, proprietary and compensation redactions. No separate state benefit filing identified.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.170\u2013180" } ], "cadence": "annual", "shareholders": true, "publicWebsite": true, "stateFiling": false, "public": true }, "enforcement": { "summary": "Company directly; derivative standing includes directors, 2% of a class/series, 5% parent owners, and charter/bylaw designees. Percentage gate does not exclude these other claimants.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.190" } ], "shareholderThreshold": "2% class/series; directors; 5% parent; document designees" }, "benefitLiability": { "summary": "Directors and officers have compliant-duty and benefit-failure monetary protections, subject to stated conditions; company has no mission-failure damages liability.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.150\u2013160,190" } ], "corporationMissionDamagesBar": true, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true }, "ordinaryExculpation": { "summary": "Default covered director/officer damages liability to corporation, stockholders or creditors requires rebutting business judgment plus breach involving intentional misconduct, fraud or knowing illegality. Articles and listed statutory exceptions can change coverage.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078.html", "section": "\u00a778.138(7)" } ], "director": true, "officer": true, "automatic": true }, "statusChange": { "summary": "Entry and exit need two thirds of each class/series, including nonvoting shares. Entry carries statutory dissenters\u2019 appraisal rights.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.110\u2013120" } ], "entryVote": "2/3 each class", "exitVote": "2/3 each class", "optionalLock": false } }, "costs": { "regularReport": { "amount": 150, "cadence": "annual", "conditions": "Minimum annual officer/director list; stock structure can increase fee.", "summary": "Minimum annual officer/director list; stock structure can increase fee.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078.html", "section": "\u00a778.150" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate state benefit-report fee identified.", "summary": "No separate state benefit-report fee identified.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.170\u2013180" } ] }, "minimumTax": { "amount": 500, "conditions": "Separate annual corporate state business license; plus $150 minimum list gives $650 known recurring minimum, excluding other taxes.", "summary": "Separate annual corporate state business license; plus $150 minimum list gives $650 known recurring minimum, excluding other taxes.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-076.html", "section": "\u00a776.100" }, { "label": "Nevada SOS, business license FAQ: $500 corporations, annual renewal and separate list fee", "url": "https://nvsos.gov/sos/licensing/state-business-license/state-business-license-faq", "checked": "2026-10-11", "section": "Nevada SOS, business license FAQ: $500 corporations, annual renewal and separate list fee" }, { "label": "Nevada DOR, Commerce Tax: $4 million Nevada revenue threshold", "url": "https://tax.nv.gov/tax-types/commerce-tax/", "checked": "2026-10-11", "section": "Nevada DOR, Commerce Tax: $4 million Nevada revenue threshold" }, { "label": "Nevada DOR, Commerce Tax instructions, V2025.1: industry rate chart", "url": "https://tax.nv.gov/wp-content/uploads/2024/05/Commerce-Tax-Return-Instructions-6-2023.pdf", "checked": "2026-10-11", "section": "Nevada DOR, Commerce Tax instructions, V2025.1: industry rate chart" }, { "label": "Nevada DOR, Modified Business Tax: current 1.17% rate and $50,000 wage exemption", "url": "https://tax.nv.gov/tax-types/modified-business-tax/", "checked": "2026-10-11", "section": "Nevada DOR, Modified Business Tax: current 1.17% rate and $50,000 wage exemption" }, { "label": "Nevada Governor's Office of Economic Development, no corporate income tax", "url": "https://goed.nv.gov/doing-business-nevada/", "checked": "2026-10-11", "section": "Nevada Governor's Office of Economic Development, no corporate income tax" } ] } }, "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.140" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.150" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.170" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.170\u2013180" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.190" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.150\u2013160,190" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-078.html", "section": "\u00a778.138(7)" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.110\u2013120" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-078.html", "section": "\u00a778.150" }, { "url": "https://www.leg.state.nv.us/NRS/NRS-076.html", "section": "\u00a776.100" }, { "label": "Nevada SOS, business license FAQ: $500 corporations, annual renewal and separate list fee", "url": "https://nvsos.gov/sos/licensing/state-business-license/state-business-license-faq", "checked": "2026-10-11", "section": "Nevada SOS, business license FAQ: $500 corporations, annual renewal and separate list fee" }, { "label": "Nevada DOR, Commerce Tax: $4 million Nevada revenue threshold", "url": "https://tax.nv.gov/tax-types/commerce-tax/", "checked": "2026-10-11", "section": "Nevada DOR, Commerce Tax: $4 million Nevada revenue threshold" }, { "label": "Nevada DOR, Commerce Tax instructions, V2025.1: industry rate chart", "url": "https://tax.nv.gov/wp-content/uploads/2024/05/Commerce-Tax-Return-Instructions-6-2023.pdf", "checked": "2026-10-11", "section": "Nevada DOR, Commerce Tax instructions, V2025.1: industry rate chart" }, { "label": "Nevada DOR, Modified Business Tax: current 1.17% rate and $50,000 wage exemption", "url": "https://tax.nv.gov/tax-types/modified-business-tax/", "checked": "2026-10-11", "section": "Nevada DOR, Modified Business Tax: current 1.17% rate and $50,000 wage exemption" }, { "label": "Nevada Governor's Office of Economic Development, no corporate income tax", "url": "https://goed.nv.gov/doing-business-nevada/", "checked": "2026-10-11", "section": "Nevada Governor's Office of Economic Development, no corporate income tax" } ], "differences": [ "Broad default ordinary director AND officer damages rule, unlike opt-in director-only states.", "Mandatory annual public third-party assessment adds work compared with Delaware.", "Known annual list plus business-license minimum is $650, not just the $150 reporting fee." ], "gaps": [ "No quantified comparison of litigation outcomes or company-specific taxes." ], "confidence": "Current code", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Nevada offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 25, 25 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Nevada has an identified director monetary-protection provision in the compared scope, which earns this credit. Default covered director/officer damages liability to corporation, stockholders or creditors requires rebutting business judgment plus breach involving intentional misconduct, fraud or knowing illegality. Articles and listed statutory exceptions can change coverage.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Nevada extends ordinary protection to officers, which earns officer-scope credit. Default covered director/officer damages liability to corporation, stockholders or creditors requires rebutting business judgment plus breach involving intentional misconduct, fraud or knowing illegality. Articles and listed statutory exceptions can change coverage.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 3, 3 ], "reason": "Statutory coverage in the selected scope receives the 3-point default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Nevada has a default statutory liability rule in the compared scope, so it earns the automatic-coverage credit. Articles and retained exceptions still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Nevada earns the benefit-specific credit for company. Directors and officers have compliant-duty and benefit-failure monetary protections, subject to stated conditions; company has no mission-failure damages liability.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Nevada earns the benefit-specific credit for directors. Directors and officers have compliant-duty and benefit-failure monetary protections, subject to stated conditions; company has no mission-failure damages liability.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Nevada earns the benefit-specific credit for officers. Directors and officers have compliant-duty and benefit-failure monetary protections, subject to stated conditions; company has no mission-failure damages liability.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Nevada: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Nevada: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Nevada: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Nevada has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 3, 3 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 3, 3 ], "reason": "Ordinary reporting $150 + benefit filing $0 = $150 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Nevada has a compared recurring floor of $650 per year, including $500 in identified minimum tax/license charges. Ordinary domestic corporation, regular renewal year, Nevada receipts below $4 million and general-business quarterly net wages no more than $50,000. Includes $500 business license additional to registry list fees; excludes variable taxes and local licenses. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry and exit need two thirds of each class/series, including nonvoting shares. Entry carries statutory dissenters\u2019 appraisal rights.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Nevada: becoming a benefit company requires 2/3 each class. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Nevada: changing back requires 2/3 each class. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Nevada requires report access for people outside the company, so it earns public-access credit. Annual shareholder report, generally within 120 days; public website or free copies on request. Permitted financial, proprietary and compensation redactions. No separate state benefit filing identified.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Nevada: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Nevada: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Nevada makes a mission duty mandatory, so it earns this credit. Mandatory consideration of enumerated stakeholders; no automatic priority unless articles prioritize a benefit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 150, "ordinaryScope": { "director": true, "officer": true, "automatic": true }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 650, "minimumTaxAnnualized": 500, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 76, 76 ], "tax": { "code": "NV", "incomeSummary": "Nevada has no general corporate net-income tax. Commerce Tax applies to Nevada gross revenue above $4 million per fiscal year, at industry rates of 0.051%-0.331%. General-business Modified Business Tax is 1.17% on quarterly wages above $50,000 after applicable health-benefit deductions; filing can still be required below the threshold.", "recurringSummary": "Corporations generally pay a $500 state business license annually. This license is filed with the annual list but is expressly additional to the annual-list fee; the absence of corporate income tax does not remove this charge.", "formationAnnualTaxFloor": 500, "floorBasis": "Ordinary domestic corporation maintaining its state business license, no applicable exemption. $500 annual license; annual-list registry fee and variable tax excluded.", "scenarioMinimum": 500, "scenarioBasis": "Ordinary domestic corporation, regular renewal year, Nevada receipts below $4 million and general-business quarterly net wages no more than $50,000. Includes $500 business license additional to registry list fees; excludes variable taxes and local licenses.", "operatingTaxCaution": "Nevada-sourced gross revenue, industry classification and Nevada payroll matter. Other operating states can tax apportioned income even though Nevada itself has no corporate income tax.", "sources": [ { "label": "Nevada SOS, business license FAQ: $500 corporations, annual renewal and separate list fee", "url": "https://nvsos.gov/sos/licensing/state-business-license/state-business-license-faq", "checked": "2026-10-11", "section": "Nevada SOS, business license FAQ: $500 corporations, annual renewal and separate list fee" }, { "label": "Nevada DOR, Commerce Tax: $4 million Nevada revenue threshold", "url": "https://tax.nv.gov/tax-types/commerce-tax/", "checked": "2026-10-11", "section": "Nevada DOR, Commerce Tax: $4 million Nevada revenue threshold" }, { "label": "Nevada DOR, Commerce Tax instructions, V2025.1: industry rate chart", "url": "https://tax.nv.gov/wp-content/uploads/2024/05/Commerce-Tax-Return-Instructions-6-2023.pdf", "checked": "2026-10-11", "section": "Nevada DOR, Commerce Tax instructions, V2025.1: industry rate chart" }, { "label": "Nevada DOR, Modified Business Tax: current 1.17% rate and $50,000 wage exemption", "url": "https://tax.nv.gov/tax-types/modified-business-tax/", "checked": "2026-10-11", "section": "Nevada DOR, Modified Business Tax: current 1.17% rate and $50,000 wage exemption" }, { "label": "Nevada Governor's Office of Economic Development, no corporate income tax", "url": "https://goed.nv.gov/doing-business-nevada/", "checked": "2026-10-11", "section": "Nevada Governor's Office of Economic Development, no corporate income tax" } ] }, "conversion": { "state": "Nevada", "code": "NV", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 each class", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry and exit need two thirds of each class/series, including nonvoting shares. Entry carries statutory dissenters\u2019 appraisal rights.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.leg.state.nv.us/NRS/NRS-078B.html", "section": "\u00a778B.110\u2013120" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required; specific benefits optional.", "difference": "Nevada offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Default covered director/officer damages liability to corporation, stockholders or creditors requires rebutting business judgment plus breach involving intentional misconduct, fraud or knowing illegality. Articles and listed statutory exceptions can change coverage. Benefit-specific rule: Directors and officers have compliant-duty and benefit-failure monetary protections, subject to stated conditions; company has no mission-failure damages liability.", "difference": "Nevada adds ordinary officer coverage and a default statutory liability rule. Broad default ordinary director AND officer damages rule, unlike opt-in director-only states." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder report, generally within 120 days; public website or free copies on request. Permitted financial, proprietary and compensation redactions. No separate state benefit filing identified. Assessment rule: Independent third-party assessment standard required; paid certification or audit is not.", "difference": "Nevada: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $150 per year on an annualized basis. Minimum tax/license used here: $500. Ordinary domestic corporation, regular renewal year, Nevada receipts below $4 million and general-business quarterly net wages no more than $50,000. Includes $500 business license additional to registry list fees; excludes variable taxes and local licenses.", "difference": "Nevada has a compared recurring floor of $650 per year, including $500 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 each class. Entry and exit need two thirds of each class/series, including nonvoting shares. Entry carries statutory dissenters\u2019 appraisal rights. Changing back: 2/3 each class", "difference": "Nevada entry uses 2/3 each class; exit uses 2/3 each class. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory consideration of enumerated stakeholders; no automatic priority unless articles prioritize a benefit. Disclosure: Annual shareholder report, generally within 120 days; public website or free copies on request. Permitted financial, proprietary and compensation redactions. No separate state benefit filing identified. Enforcement: Company directly; derivative standing includes directors, 2% of a class/series, 5% parent owners, and charter/bylaw designees. Percentage gate does not exclude these other claimants.", "difference": "Nevada requires public access to the report. Mandatory annual public third-party assessment adds work compared with Delaware. Known annual list plus business-license minimum is $650, not just the $150 reporting fee." } } }, "guideUrl": "/assets/state-guides/NV.md" }, { "state": "New Hampshire", "abbreviation": "NH", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / mandatory-stakeholder model with state sanctions", "features": { "purpose": { "summary": "General benefit required; specific charter benefits optional.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-6.htm", "section": "293-C:6" } ] }, "board": { "summary": "Mandatory stakeholder consideration; charter may prioritize mission interests. Independent benefit director required only if publicly traded; optional if private.", "mode": "mandatory_consider", "benefitDirectorRequired": "publicly traded only", "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-7.htm", "section": "293-C:7-8" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-8.htm", "section": "293-C:8" } ] }, "standard": { "summary": "Third-party standard assessment required. Statute says report and assessment shall not be audited/certified by a third party; certification of report is not required.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-12.htm", "section": "293-C:12(I),(III)" } ] }, "report": { "summary": "Annual to shareholders by earlier of 120 days or other annual report; all reports public online, latest free on request if no website. State copy with $35. Failure to make report available triggers statutory administrative dissolution.", "cadence": "annual", "shareholders": true, "publicWebsite": "all annual reports", "stateFiling": true, "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-13.htm", "section": "293-C:13" } ], "public": true }, "enforcement": { "summary": "Corporation; collective 2% of class/series at challenged act, directors, 5% parent equity, charter/bylaw designees. Secretary may revoke benefit status after court determination of mission failure.", "shareholderThreshold": "2% of class/series", "directorStanding": true, "parentThreshold": "5% of parent equity", "otherStanding": "charter/bylaw designees; Secretary status sanction", "corporationStanding": true, "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-11.htm", "section": "293-C:11" } ] }, "benefitLiability": { "summary": "Corporation mission-failure damages barred; director/officer compliant-duty and mission-failure monetary protection unless charter/bylaws override.", "corporationMissionDamagesBar": true, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-11.htm", "section": "293-C:11(II)" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-7.htm", "section": "293-C:7(III)" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-9.htm", "section": "293-C:9(III)" } ] }, "ordinaryExculpation": { "summary": "Charter may exculpate directors and officers against corporation/shareholder monetary claims except unentitled financial benefit, intentional harm, unlawful distributions and intentional criminal-law violation.", "director": true, "officer": true, "automatic": false, "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-A/293-A-202.htm", "section": "293-A:2.02(b)(4)" } ] }, "statusChange": { "summary": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds of each class, including nonvoting", "optionalLock": false, "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-2.htm", "section": "293-C:2;293-C:4-5" } ] } }, "costs": { "regularReport": { "amount": 100, "currency": "USD", "cadence": "annual", "conditions": "Domestic/foreign for-profit corporate annual report.", "summary": "Domestic/foreign for-profit corporate annual report.", "sources": [ { "url": "https://www.sos.nh.gov/corporations-0/forms-and-fees/domestic-and-foreign-corporation", "section": "annual report fee" } ] }, "benefitReport": { "amount": 35, "currency": "USD", "cadence": "annual", "conditions": "Separate benefit-report fee; in addition to regular $100 annual report.", "summary": "Separate benefit-report fee; in addition to regular $100 annual report.", "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-13.htm", "section": "293-C:13(IV)" } ] }, "minimumTax": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "There is no single flat annual business-tax minimum. For taxable periods beginning in 2025\u20132026, BPT filing is required when gross business income from all activities exceeds $109,000; BET filing is required when gross receipts from all activities or the enterprise-value base exceeds $298,000. BPT is 7.5% of taxable business profits. BET is 0.55% of the taxable enterprise-value base, generally compensation, interest and dividends, and can be due even when profits are zero. BET paid can credit BPT, subject to statutory rules. A business below both filing thresholds can have $0 of these taxes; crossing a filing threshold does not make gross receipts the tax base. The separate $100 annual report and $35 benefit report still apply.", "basis": "Conditional $0 below both current filing thresholds; taxable profit/value, nexus and apportionment determine actual liability.", "summary": "There is no single flat annual business-tax minimum. For taxable periods beginning in 2025\u20132026, BPT filing is required when gross business income from all activities exceeds $109,000; BET filing is required when gross receipts from all activities or the enterprise-value base exceeds $298,000. BPT is 7.5% of taxable business profits. BET is 0.55% of the taxable enterprise-value base, generally compensation, interest and dividends, and can be due even when profits are zero. BET paid can credit BPT, subject to statutory rules. A business below both filing thresholds can have $0 of these taxes; crossing a filing threshold does not make gross receipts the tax base. The separate $100 annual report and $35 benefit report still apply.", "sources": [ { "url": "https://www.revenue.nh.gov/taxes-glance/business-taxes", "section": "Business Enterprise Tax & Business Profits Tax: rates, bases, 2025-onward filing thresholds and BET credit" }, { "url": "https://www.revenue.nh.gov/news-and-media/nh-department-revenue-administration-shares-2026-tax-tips-and-filing-guidance", "section": "March 10, 2026 filing guidance: $298,000 BET and $109,000 BPT thresholds" }, { "label": "New Hampshire DRA: BPT/BET rates, 2025 onward filing thresholds and bases", "url": "https://www.revenue.nh.gov/taxes-glance/business-taxes", "checked": "2026-10-11", "section": "New Hampshire DRA: BPT/BET rates, 2025 onward filing thresholds and bases" }, { "label": "New Hampshire DRA: business-profits-tax FAQ and apportionment", "url": "https://www.revenue.nh.gov/resource-center/frequently-asked-questions/business-profits-tax", "checked": "2026-10-11", "section": "New Hampshire DRA: business-profits-tax FAQ and apportionment" }, { "label": "New Hampshire DRA: 2026 filing guidance confirming current thresholds", "url": "https://www.revenue.nh.gov/news-and-media/nh-department-revenue-administration-shares-2026-tax-tips-and-filing-guidance", "checked": "2026-10-11", "section": "New Hampshire DRA: 2026 filing guidance confirming current thresholds" } ] } }, "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-6.htm", "section": "293-C:6" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-7.htm", "section": "293-C:7-8" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-8.htm", "section": "293-C:8" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-12.htm", "section": "293-C:12(I),(III)" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-13.htm", "section": "293-C:13" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-11.htm", "section": "293-C:11" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-11.htm", "section": "293-C:11(II)" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-7.htm", "section": "293-C:7(III)" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-9.htm", "section": "293-C:9(III)" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-A/293-A-202.htm", "section": "293-A:2.02(b)(4)" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-2.htm", "section": "293-C:2;293-C:4-5" }, { "url": "https://www.sos.nh.gov/corporations-0/forms-and-fees/domestic-and-foreign-corporation", "section": "annual report fee" }, { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-13.htm", "section": "293-C:13(IV)" }, { "url": "https://www.revenue.nh.gov/taxes-glance/business-taxes", "section": "Business Enterprise Tax & Business Profits Tax: rates, bases, 2025-onward filing thresholds and BET credit" }, { "url": "https://www.revenue.nh.gov/news-and-media/nh-department-revenue-administration-shares-2026-tax-tips-and-filing-guidance", "section": "March 10, 2026 filing guidance: $298,000 BET and $109,000 BPT thresholds" }, { "label": "New Hampshire DRA: BPT/BET rates, 2025 onward filing thresholds and bases", "url": "https://www.revenue.nh.gov/taxes-glance/business-taxes", "checked": "2026-10-11", "section": "New Hampshire DRA: BPT/BET rates, 2025 onward filing thresholds and bases" }, { "label": "New Hampshire DRA: business-profits-tax FAQ and apportionment", "url": "https://www.revenue.nh.gov/resource-center/frequently-asked-questions/business-profits-tax", "checked": "2026-10-11", "section": "New Hampshire DRA: business-profits-tax FAQ and apportionment" }, { "label": "New Hampshire DRA: 2026 filing guidance confirming current thresholds", "url": "https://www.revenue.nh.gov/news-and-media/nh-department-revenue-administration-shares-2026-tax-tips-and-filing-guidance", "checked": "2026-10-11", "section": "New Hampshire DRA: 2026 filing guidance confirming current thresholds" } ], "differences": [ "Both directors and officers eligible for ordinary charter exculpation.", "Missed benefit reporting has dissolution consequences; court mission finding can revoke benefit status.", "Annual state reporting requires both $100 ordinary report and $35 benefit report." ], "gaps": [], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "New Hampshire offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 22, 22 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "New Hampshire has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter may exculpate directors and officers against corporation/shareholder monetary claims except unentitled financial benefit, intentional harm, unlawful distributions and intentional criminal-law violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "New Hampshire extends ordinary protection to officers, which earns officer-scope credit. Charter may exculpate directors and officers against corporation/shareholder monetary claims except unentitled financial benefit, intentional harm, unlawful distributions and intentional criminal-law violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "New Hampshire requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "New Hampshire earns the benefit-specific credit for company. Corporation mission-failure damages barred; director/officer compliant-duty and mission-failure monetary protection unless charter/bylaws override.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "New Hampshire earns the benefit-specific credit for directors. Corporation mission-failure damages barred; director/officer compliant-duty and mission-failure monetary protection unless charter/bylaws override.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "New Hampshire earns the benefit-specific credit for officers. Corporation mission-failure damages barred; director/officer compliant-duty and mission-failure monetary protection unless charter/bylaws override.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "New Hampshire: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "New Hampshire: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "New Hampshire: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "New Hampshire has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 9, 9 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 9, 9 ], "reason": "Ordinary reporting $100 + benefit filing $35 = $135 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "New Hampshire has a compared recurring floor of $135 per year, including $0 in identified minimum tax/license charges. Small active domestic C corporation in a regular 2026 period, no taxable profit, gross business income no more than $109,000, and both gross receipts and enterprise-value base no more than $298,000. Merely having no profit is insufficient to exclude BET. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "New Hampshire: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "New Hampshire: changing back requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "New Hampshire requires report access for people outside the company, so it earns public-access credit. Annual to shareholders by earlier of 120 days or other annual report; all reports public online, latest free on request if no website. State copy with $35. Failure to make report available triggers statutory administrative dissolution.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "New Hampshire: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "New Hampshire: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "New Hampshire makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration; charter may prioritize mission interests. Independent benefit director required only if publicly traded; optional if private.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 135, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 135, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 76, 76 ], "tax": { "code": "NH", "incomeSummary": "New Hampshire Business Profits Tax (BPT) is 7.5% for taxable periods ending on or after December 31, 2023. For periods beginning in 2025\u20132026, filing is required above $109,000 of gross business income from all activities. Income is generally apportioned by single sales factor, and unitary businesses use combined reporting.", "recurringSummary": "Business Enterprise Tax (BET) is separately 0.55% of the taxable enterprise-value base, generally compensation, interest and dividends. For periods beginning in 2025\u20132026, the filing threshold is over $298,000 of gross receipts or enterprise-value base. BET can apply without profit and may credit BPT. No single fixed annual business-tax minimum is stated.", "formationAnnualTaxFloor": null, "floorBasis": "No fixed tax arises solely from domestic corporate status in the cited business-tax guidance. A $0 result depends on filing thresholds and taxable bases, including compensation; the annual corporate report and benefit-report fees are separate.", "scenarioMinimum": 0, "scenarioBasis": "Small active domestic C corporation in a regular 2026 period, no taxable profit, gross business income no more than $109,000, and both gross receipts and enterprise-value base no more than $298,000. Merely having no profit is insufficient to exclude BET.", "operatingTaxCaution": "DRA taxes gain-or-profit organizations carrying on New Hampshire business activity, not just incorporated entities. Filing thresholds use everywhere activity while tax bases are apportioned to the state. Cross-state operations, unitary membership and payroll/dividend/interest payments must be tested separately.", "sources": [ { "label": "New Hampshire DRA: BPT/BET rates, 2025 onward filing thresholds and bases", "url": "https://www.revenue.nh.gov/taxes-glance/business-taxes", "checked": "2026-10-11", "section": "New Hampshire DRA: BPT/BET rates, 2025 onward filing thresholds and bases" }, { "label": "New Hampshire DRA: business-profits-tax FAQ and apportionment", "url": "https://www.revenue.nh.gov/resource-center/frequently-asked-questions/business-profits-tax", "checked": "2026-10-11", "section": "New Hampshire DRA: business-profits-tax FAQ and apportionment" }, { "label": "New Hampshire DRA: 2026 filing guidance confirming current thresholds", "url": "https://www.revenue.nh.gov/news-and-media/nh-department-revenue-administration-shares-2026-tax-tips-and-filing-guidance", "checked": "2026-10-11", "section": "New Hampshire DRA: 2026 filing guidance confirming current thresholds" } ] }, "conversion": { "state": "New Hampshire", "code": "NH", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://gc.nh.gov/RSA/html/XXVII/293-C/293-C-2.htm", "section": "293-C:2;293-C:4-5" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General benefit required; specific charter benefits optional.", "difference": "New Hampshire offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter may exculpate directors and officers against corporation/shareholder monetary claims except unentitled financial benefit, intentional harm, unlawful distributions and intentional criminal-law violation. Benefit-specific rule: Corporation mission-failure damages barred; director/officer compliant-duty and mission-failure monetary protection unless charter/bylaws override.", "difference": "New Hampshire adds ordinary officer coverage; the charter must elect the ordinary protection. Both directors and officers eligible for ordinary charter exculpation." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders by earlier of 120 days or other annual report; all reports public online, latest free on request if no website. State copy with $35. Failure to make report available triggers statutory administrative dissolution. Assessment rule: Third-party standard assessment required. Statute says report and assessment shall not be audited/certified by a third party; certification of report is not required.", "difference": "New Hampshire: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $135 per year on an annualized basis. Minimum tax/license used here: $0. Small active domestic C corporation in a regular 2026 period, no taxable profit, gross business income no more than $109,000, and both gross receipts and enterprise-value base no more than $298,000. Merely having no profit is insufficient to exclude BET.", "difference": "New Hampshire has a compared recurring floor of $135 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Two-thirds of every class/series including nonvoting for entry/exit and covered transactions. Changing back: two-thirds of each class, including nonvoting", "difference": "New Hampshire entry uses two-thirds of each class, including nonvoting; exit uses two-thirds of each class, including nonvoting. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration; charter may prioritize mission interests. Independent benefit director required only if publicly traded; optional if private. Disclosure: Annual to shareholders by earlier of 120 days or other annual report; all reports public online, latest free on request if no website. State copy with $35. Failure to make report available triggers statutory administrative dissolution. Enforcement: Corporation; collective 2% of class/series at challenged act, directors, 5% parent equity, charter/bylaw designees. Secretary may revoke benefit status after court determination of mission failure.", "difference": "New Hampshire requires public access to the report. Missed benefit reporting has dissolution consequences; court mission finding can revoke benefit status. Annual state reporting requires both $100 ordinary report and $35 benefit report." } } }, "guideUrl": "/assets/state-guides/NH.md" }, { "state": "New Jersey", "abbreviation": "NJ", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / independent-benefit-director model", "features": { "purpose": { "summary": "General public benefit required; specific charter benefits optional.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-5; P.L.2011 c.30 \u00a75" } ] }, "board": { "summary": "Mandatory stakeholder consideration; charter can prioritize a specific benefit. Independent benefit director required for all, including private corporations (boardless replacement permitted).", "mode": "mandatory_consider", "benefitDirectorRequired": "all; boardless replacement", "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-6,-7" } ] }, "standard": { "summary": "Third-party standard assessment required. No mandatory external audit or certification expressed in Chapter 18.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-11(a)" } ] }, "report": { "summary": "Annual to shareholders by earlier of 120 days or other annual report. Latest report public online if website; also state Treasury filing, $70. After two years missing state reports, benefit status may be forfeited and reinstated on filing.", "cadence": "annual", "shareholders": true, "publicWebsite": "most recent report if website", "stateFiling": true, "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-11(b)-(d)" } ], "public": true }, "enforcement": { "summary": "Corporation; any shareholder, director, 10% equity of parent entity, charter/bylaw designees.", "shareholderThreshold": "any shareholder subject to derivative procedure", "directorStanding": true, "parentThreshold": "10% of parent equity", "otherStanding": "charter/bylaw designees", "corporationStanding": true, "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-10" } ] }, "benefitLiability": { "summary": "Directors/officers not personally liable for mission-failure damages. No explicit blanket corporation damages bar in enforcement section. Benefit-director immunity excludes self-dealing, wilful misconduct and knowing violation.", "corporationMissionDamagesBar": false, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-6(d),-7(e),-8(c),-10" } ] }, "ordinaryExculpation": { "summary": "Charter may limit/eliminate director and officer damages to corporation/shareholders. Excludes duty-of-loyalty breach, lack of good faith/knowing law violations and improper personal benefit; loyalty conflict defined by known/believed adverse interests and material conflict.", "director": true, "officer": true, "automatic": false, "sources": [ { "url": "https://lis.njleg.state.nj.us/nxt/gateway.dll/statutes/1/10536/10558?f=templates%24fn%3Ddocument-frameset.htm%24q%3D%5Brank%2C100%3A%5Bdomain%3A%5Band%3A14A%3A2-7.+Certificate+of+incorporation%5D%5D+%5Bsum%3A14A%3A2-7.+Certificate+of+incorporation%5D+%5D+%24x%3Dserver%243.0", "section": "14A:2-7(3)" } ] }, "statusChange": { "summary": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds of each class, including nonvoting", "optionalLock": false, "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-1,-3,-4" } ] } }, "costs": { "regularReport": { "amount": 75, "currency": "USD", "cadence": "annual", "conditions": "Ordinary for-profit corporate annual report.", "summary": "Ordinary for-profit corporate annual report.", "sources": [ { "url": "https://www.nj.gov/treasury/revenue/fees.shtml", "section": "for-profit corporate/LP filing schedule" } ] }, "benefitReport": { "amount": 70, "currency": "USD", "cadence": "annual", "conditions": "Statutory separate $70 annual benefit-report charge under \u00a714A:18-11(d)(1), filed with Treasury when delivered to shareholders. The current DORES annual-report portal supports \u201cNJ Benefit Domestic Profit Corporation (BDP)\u201d and separately publishes an ordinary $75 annual corporate-report charge. The public landing/fee pages do not display the benefit-upload payment screen; therefore this $70 is statutory, not a tested checkout quote.", "verification": "current statutory requirement; current public agency portal accepts BDP entities; checkout not submitted", "summary": "Statutory separate $70 annual benefit-report charge under \u00a714A:18-11(d)(1), filed with Treasury when delivered to shareholders. The current DORES annual-report portal supports \u201cNJ Benefit Domestic Profit Corporation (BDP)\u201d and separately publishes an ordinary $75 annual corporate-report charge. The public landing/fee pages do not display the benefit-upload payment screen; therefore this $70 is statutory, not a tested checkout quote.", "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-11(d)(1)" }, { "url": "https://www.njportal.com/DOR/AnnualReports/Business?sessionType=AnnualReport", "section": "Current public Business Type selector includes NJ Benefit Domestic Profit Corporation (BDP)" }, { "url": "https://www.nj.gov/treasury/revenue/fees.shtml", "section": "Current agency registry fee schedule: ordinary for-profit annual report $75, updated July 1, 2026" } ] }, "minimumTax": { "amount": 500, "currency": "USD", "cadence": "annual", "conditions": "C corporation with NJ gross receipts below $100,000; higher receipts raise minimum. Affiliated/controlled group with payroll \u2265$5m has $2,000 minimum; S-corporation rules differ.", "summary": "C corporation with NJ gross receipts below $100,000; higher receipts raise minimum. Affiliated/controlled group with payroll \u2265$5m has $2,000 minimum; S-corporation rules differ.", "sources": [ { "url": "https://www.nj.gov/treasury/taxation/ot4.shtml", "section": "Corporation Business Tax minimum" }, { "label": "New Jersey Division of Taxation: current 2025 CBT-100 instructions", "url": "https://www.nj.gov/treasury/taxation/pdf/current/cbt/cbt100ins.pdf", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: current 2025 CBT-100 instructions" }, { "label": "New Jersey Division of Taxation: corporation filing responsibilities and minimum schedule", "url": "https://www.nj.gov/treasury/taxation/ot4.shtml", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: corporation filing responsibilities and minimum schedule" }, { "label": "New Jersey Division of Taxation: Corporate Transit Fee", "url": "https://nj.gov/www.nj.gov/treasury/taxation/cbt/corporatetransitfee.shtml", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: Corporate Transit Fee" } ] } }, "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-5; P.L.2011 c.30 \u00a75" }, { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-6,-7" }, { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-11(a)" }, { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-11(b)-(d)" }, { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-10" }, { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-6(d),-7(e),-8(c),-10" }, { "url": "https://lis.njleg.state.nj.us/nxt/gateway.dll/statutes/1/10536/10558?f=templates%24fn%3Ddocument-frameset.htm%24q%3D%5Brank%2C100%3A%5Bdomain%3A%5Band%3A14A%3A2-7.+Certificate+of+incorporation%5D%5D+%5Bsum%3A14A%3A2-7.+Certificate+of+incorporation%5D+%5D+%24x%3Dserver%243.0", "section": "14A:2-7(3)" }, { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-1,-3,-4" }, { "url": "https://www.nj.gov/treasury/revenue/fees.shtml", "section": "for-profit corporate/LP filing schedule" }, { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-11(d)(1)" }, { "url": "https://www.njportal.com/DOR/AnnualReports/Business?sessionType=AnnualReport", "section": "Current public Business Type selector includes NJ Benefit Domestic Profit Corporation (BDP)" }, { "url": "https://www.nj.gov/treasury/revenue/fees.shtml", "section": "Current agency registry fee schedule: ordinary for-profit annual report $75, updated July 1, 2026" }, { "url": "https://www.nj.gov/treasury/taxation/ot4.shtml", "section": "Corporation Business Tax minimum" }, { "label": "New Jersey Division of Taxation: current 2025 CBT-100 instructions", "url": "https://www.nj.gov/treasury/taxation/pdf/current/cbt/cbt100ins.pdf", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: current 2025 CBT-100 instructions" }, { "label": "New Jersey Division of Taxation: corporation filing responsibilities and minimum schedule", "url": "https://www.nj.gov/treasury/taxation/ot4.shtml", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: corporation filing responsibilities and minimum schedule" }, { "label": "New Jersey Division of Taxation: Corporate Transit Fee", "url": "https://nj.gov/www.nj.gov/treasury/taxation/cbt/corporatetransitfee.shtml", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: Corporate Transit Fee" } ], "differences": [ "Independent benefit director required for private as well as public corporations.", "Any qualifying shareholder may enforce, but parent-equity standing is 10%.", "Ordinary officer charter protection is available; separate $70 annual benefit filing and status-forfeiture rule." ], "gaps": [ "Full benefit text read in official enactment; current official 2026 amendment index still lists Chapter 18 as 2011 c.30 with no amendments, but dynamic consolidated chapter pages could not be retrieved in full.", "The public DORES portal supports benefit corporations; its entity-specific benefit-report payment/upload screen cannot be inspected without an actual entity lookup. The $70 amount is expressly statutory; checkout processing charges are excluded." ], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "New Jersey offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "New Jersey has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter may limit/eliminate director and officer damages to corporation/shareholders. Excludes duty-of-loyalty breach, lack of good faith/knowing law violations and improper personal benefit; loyalty conflict defined by known/believed adverse interests and material conflict.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "New Jersey extends ordinary protection to officers, which earns officer-scope credit. Charter may limit/eliminate director and officer damages to corporation/shareholders. Excludes duty-of-loyalty breach, lack of good faith/knowing law violations and improper personal benefit; loyalty conflict defined by known/believed adverse interests and material conflict.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "New Jersey requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "New Jersey has no separately credited benefit-specific monetary shield for company. Directors/officers not personally liable for mission-failure damages. No explicit blanket corporation damages bar in enforcement section. Benefit-director immunity excludes self-dealing, wilful misconduct and knowing violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "New Jersey earns the benefit-specific credit for directors. Directors/officers not personally liable for mission-failure damages. No explicit blanket corporation damages bar in enforcement section. Benefit-director immunity excludes self-dealing, wilful misconduct and knowing violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "New Jersey earns the benefit-specific credit for officers. Directors/officers not personally liable for mission-failure damages. No explicit blanket corporation damages bar in enforcement section. Benefit-director immunity excludes self-dealing, wilful misconduct and knowing violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 8, 8 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "New Jersey: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "New Jersey: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "New Jersey: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "Mandatory benefit director or report-approval procedure in this private-company scope: no 3-point flexibility bonus.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "New Jersey requires an additional benefit-director or report-approval procedure in this private-company scope, so it receives no no-extra-step credit. Mandatory stakeholder consideration; charter can prioritize a specific benefit. Independent benefit director required for all, including private corporations (boardless replacement permitted).", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 3, 3 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 3, 3 ], "reason": "Ordinary reporting $75 + benefit filing $70 = $145 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "New Jersey has a compared recurring floor of $645 per year, including $500 in identified minimum tax/license charges. Small active domestic separate C corporation in a regular year, New Jersey gross receipts under $100,000, no taxable profit and no affiliated/controlled group with $5 million payroll. The additional installment on a low-tax return is a prepayment against the following period, not a second annual tax. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "New Jersey: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "New Jersey: changing back requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "New Jersey requires report access for people outside the company, so it earns public-access credit. Annual to shareholders by earlier of 120 days or other annual report. Latest report public online if website; also state Treasury filing, $70. After two years missing state reports, benefit status may be forfeited and reinstated on filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "New Jersey: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "New Jersey: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "New Jersey makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration; charter can prioritize a specific benefit. Independent benefit director required for all, including private corporations (boardless replacement permitted).", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 145, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": true, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 645, "minimumTaxAnnualized": 500, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 65, 65 ], "tax": { "code": "NJ", "incomeSummary": "For ordinary separate C-corporation filers, Corporation Business Tax is 6.5% when the applicable taxable-income base is $50,000 or less, 7.5% above $50,000 through $100,000, and 9% above $100,000. Each selected rate applies to the full base. A separate 2.5% Corporate Transit Fee applies when taxable net income exceeds $10 million for privilege periods beginning in 2024\u20132028; exemptions and group rules differ.", "recurringSummary": "The annual C-corporation minimum is $500 with New Jersey gross receipts below $100,000, then $750/$1,000/$1,500/$2,000 at higher tiers. An affiliated/controlled group's payroll of at least $5 million can require $2,000 per member. Inactive corporations still pay the minimum; the minimum cannot be prorated. Annual registry reporting is additional.", "formationAnnualTaxFloor": 500, "floorBasis": "Lowest ordinary separate domestic C-corporation minimum with New Jersey gross receipts under $100,000 and without the high-payroll affiliated/controlled-group rule. It applies even without activity. Excludes the annual report, higher receipts, S-corporation classification, incentive credits, professional fees and tax prepayments.", "scenarioMinimum": 500, "scenarioBasis": "Small active domestic separate C corporation in a regular year, New Jersey gross receipts under $100,000, no taxable profit and no affiliated/controlled group with $5 million payroll. The additional installment on a low-tax return is a prepayment against the following period, not a second annual tax.", "operatingTaxCaution": "The current CBT-100 instructions cover domestic and qualified foreign corporations and other nexus connections. Bright-line receipts nexus can arise above $100,000 New Jersey receipts or at least 200 customer transactions; taxpayers claiming P.L. 86-272 immunity still remit the minimum. Combined reporting and market sourcing can change the calculation.", "sources": [ { "label": "New Jersey Division of Taxation: current 2025 CBT-100 instructions", "url": "https://www.nj.gov/treasury/taxation/pdf/current/cbt/cbt100ins.pdf", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: current 2025 CBT-100 instructions" }, { "label": "New Jersey Division of Taxation: corporation filing responsibilities and minimum schedule", "url": "https://www.nj.gov/treasury/taxation/ot4.shtml", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: corporation filing responsibilities and minimum schedule" }, { "label": "New Jersey Division of Taxation: Corporate Transit Fee", "url": "https://nj.gov/www.nj.gov/treasury/taxation/cbt/corporatetransitfee.shtml", "checked": "2026-10-11", "section": "New Jersey Division of Taxation: Corporate Transit Fee" } ] }, "conversion": { "state": "New Jersey", "code": "NJ", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://pub.njleg.gov/bills/2010/PL11/30_.HTM", "section": "14A:18-1,-3,-4" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required; specific charter benefits optional.", "difference": "New Jersey offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter may limit/eliminate director and officer damages to corporation/shareholders. Excludes duty-of-loyalty breach, lack of good faith/knowing law violations and improper personal benefit; loyalty conflict defined by known/believed adverse interests and material conflict. Benefit-specific rule: Directors/officers not personally liable for mission-failure damages. No explicit blanket corporation damages bar in enforcement section. Benefit-director immunity excludes self-dealing, wilful misconduct and knowing violation.", "difference": "New Jersey adds ordinary officer coverage; the charter must elect the ordinary protection. Independent benefit director required for private as well as public corporations. Ordinary officer charter protection is available; separate $70 annual benefit filing and status-forfeiture rule." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders by earlier of 120 days or other annual report. Latest report public online if website; also state Treasury filing, $70. After two years missing state reports, benefit status may be forfeited and reinstated on filing. Assessment rule: Third-party standard assessment required. No mandatory external audit or certification expressed in Chapter 18.", "difference": "New Jersey: Annual; Required outside framework; state benefit-report filing. An additional benefit-director or approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $145 per year on an annualized basis. Minimum tax/license used here: $500. Small active domestic separate C corporation in a regular year, New Jersey gross receipts under $100,000, no taxable profit and no affiliated/controlled group with $5 million payroll. The additional installment on a low-tax return is a prepayment against the following period, not a second annual tax.", "difference": "New Jersey has a compared recurring floor of $645 per year, including $500 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Two-thirds of every class/series including nonvoting for entry/exit and covered transactions. Changing back: two-thirds of each class, including nonvoting", "difference": "New Jersey entry uses two-thirds of each class, including nonvoting; exit uses two-thirds of each class, including nonvoting. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration; charter can prioritize a specific benefit. Independent benefit director required for all, including private corporations (boardless replacement permitted). Disclosure: Annual to shareholders by earlier of 120 days or other annual report. Latest report public online if website; also state Treasury filing, $70. After two years missing state reports, benefit status may be forfeited and reinstated on filing. Enforcement: Corporation; any shareholder, director, 10% equity of parent entity, charter/bylaw designees.", "difference": "New Jersey requires public access to the report. Independent benefit director required for private as well as public corporations. Any qualifying shareholder may enforce, but parent-equity standing is 10%." } } }, "guideUrl": "/assets/state-guides/NJ.md" }, { "state": "New Mexico", "abbreviation": "NM", "form": "Benefit corporation designation", "status": "Available", "reviewed": "2026-10-11", "family": "compact general-benefit statute with different voting/class rule", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General social/environmental benefit is mandatory, measured relative to company size and business nature; charter may specify additional purposes.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ] }, "board": { "model": "mandatory_stakeholder_consideration", "summary": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Annual social/environmental performance assessment against an independent third-party standard is required. No paid-certification requirement appears in the enacted section.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "deadline": "Annual benefit report; no 120-day deadline in enacted \u00a753-12-7.", "redactions": "Director compensation, financial information and proprietary information may be omitted from the publicly posted or furnished report under \u00a753-12-7(A)(4)(d).", "summary": "Annual public/shareholder benefit report. For a publicly traded benefit corporation, an independent board director prepares it; private companies may appoint one.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ] }, "enforcement": { "threshold": "2% total shares OR 2% of a class at act/omission; director; 5% parent equity owner; other persons authorized in articles/bylaws.", "summary": "Corporation direct or enumerated derivative plaintiffs; class ownership can qualify even below 2% total ownership.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to create general or specific benefit.", "directors": "No distinct benefit-act director monetary shield stated in \u00a753-12-7; ordinary law and any authorized charter provision must be assessed.", "officers": "No separate benefit-act officer damages shield identified.", "summary": "The compact statute expressly shields the corporation\u2019s benefit-failure liability but does not reproduce model-act director/officer monetary bars.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ] }, "ordinaryExculpation": { "scope": "directors only, with a negligence exception for any owner or director paid more than $2,000 annually", "activation": "An articles provision under \u00a753-12-2(E); applies prospectively to board/committee meeting or unanimous written-consent actions under \u00a753-11-43.", "exceptions": [ "For a director with any ownership interest, or annual director/employee compensation above $2,000: negligence, willful misconduct or recklessness when the \u00a753-11-35(B) director duty is breached", "For a director with no ownership interest and compensation of $2,000 or less: willful misconduct or recklessness when that duty is breached", "Actions/inactions outside board or committee meetings or authorized written consent", "Acts before the articles provision becomes effective", "Officer conduct is outside the director-only articles provision" ], "summary": "New Mexico is unusually restrictive for founders: any ownership, or annual director/employee compensation above $2,000, preserves liability for negligent fiduciary conduct. The limited negligence shield available to unpaid/low-paid nonowner directors does not extend to founder directors.", "sources": [ { "id": "NM-ordinary-current", "url": "https://www.nmlegis.gov/Sessions/21%20Regular/final/SB0202.pdf", "section": "2021 ch.68 \u00a74; \u00a753-12-2(E)(1)\u2013(3)", "claims": [ "Director-only articles provision; owner/compensation-dependent negligence exception; restricted decision settings; prospective effect" ] } ] }, "statusChange": { "entryVote": "Two thirds of voting shares; class approval only when that class is entitled to vote.", "exitVote": "Same two-thirds voting-share amendment rule; delete required benefit provisions.", "lock": "No unconditional permanent status lock identified.", "summary": "Unlike the model, the enacted section does not automatically enfranchise every otherwise nonvoting class for benefit amendments.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ] } }, "costs": { "regularReport": { "amount": 25, "cadence": "biennial", "conditions": "\u00a753-2-1(A)(16) sets the corporate-report base fee at $25; ordinary for-profit corporate reporting is biennial under \u00a753-5-2. Card-handling, supplemental-report and late fees are separate.", "summary": "\u00a753-2-1(A)(16) sets the corporate-report base fee at $25; ordinary for-profit corporate reporting is biennial under \u00a753-5-2. Card-handling, supplemental-report and late fees are separate.", "sources": [ { "id": "NM-report-fee", "url": "https://www.sos.nm.gov/wp-content/uploads/2019/10/20180215_SOS_Celebrates_Passage_of_SB225.pdf", "section": "Feb. 15, 2018 official announcement", "claims": [ "Biennial corporation reporting under 2018 SB 225; $25 base fee independently checked against \u00a753-2-1." ] }, { "id": "NM-report-fee-current", "url": "https://www.nmlegis.gov/Sessions/15%20Regular/final/HB0287.pdf", "section": "2015 ch.66 \u00a71; \u00a753-2-1(A)(16), (E)", "claims": [ "$25 corporate-report base fee; card-service charges separately authorized" ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No state benefit-report filing in the enacted section.", "summary": "No state benefit-report filing in the enacted section.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ] }, "minimumTax": { "amount": 50, "cadence": "annual", "conditions": "The $50 annual corporate franchise tax generally applies to corporations engaging in business in, deriving income from, or registered to transact business in New Mexico, including inactive corporations; corporate income tax is separate. Benefit status creates no general tax exemption.", "summary": "The $50 annual corporate franchise tax generally applies to corporations engaging in business in, deriving income from, or registered to transact business in New Mexico, including inactive corporations; corporate income tax is separate. Benefit status creates no general tax exemption.", "sources": [ { "id": "NM-tax", "url": "https://www.tax.newmexico.gov/businesses/corporate-income-franchise-tax-overview/", "section": "Corporate franchise tax", "claims": [ "Annual $50 corporate franchise tax minimum" ] }, { "label": "New Mexico TRD, corporate income and franchise overview: $50 even inactive", "url": "https://www.tax.newmexico.gov/businesses/corporate-income-franchise-tax-overview/", "checked": "2026-10-11", "section": "New Mexico TRD, corporate income and franchise overview: $50 even inactive" }, { "label": "New Mexico Legislature, enacted HB252, sections 10 and 42-43: flat 5.9% corporate income rate from 2025", "url": "https://www.nmlegis.gov/Sessions/24%20Regular/final/HB0252.pdf", "checked": "2026-10-11", "section": "New Mexico Legislature, enacted HB252, sections 10 and 42-43: flat 5.9% corporate income rate from 2025" }, { "label": "New Mexico Legislature, HB252 enactment record: Chapter 67, March 6, 2024", "url": "https://www.nmlegis.gov/Legislation/Legislation?chamber=H&legNo=252&legType=B&year=24", "checked": "2026-10-11", "section": "New Mexico Legislature, HB252 enactment record: Chapter 67, March 6, 2024" }, { "label": "New Mexico TRD, gross receipts overview: taxable activities, sourcing and current rate schedules", "url": "https://www.tax.newmexico.gov/businesses/gross-receipts-overview/", "checked": "2026-10-11", "section": "New Mexico TRD, gross receipts overview: taxable activities, sourcing and current rate schedules" } ] } }, "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] }, { "id": "NM-designation", "url": "https://www.sos.nm.gov/2020/07/09/secretary-of-state-announces-the-creation-of-benefit-corporation-designation-for-new-mexico-businesses/", "section": "Secretary of State announcement", "claims": [ "Benefit corporation designation exists; 2020 law in effect" ] }, { "id": "NM-report-fee", "url": "https://www.sos.nm.gov/wp-content/uploads/2019/10/20180215_SOS_Celebrates_Passage_of_SB225.pdf", "section": "Feb. 15, 2018 official announcement", "claims": [ "Biennial corporation reporting under 2018 SB 225; $25 base fee independently checked against \u00a753-2-1." ] }, { "id": "NM-tax", "url": "https://www.tax.newmexico.gov/businesses/corporate-income-franchise-tax-overview/", "section": "Corporate franchise tax", "claims": [ "Annual $50 corporate franchise tax minimum" ] }, { "id": "NM-ordinary-current", "url": "https://www.nmlegis.gov/Sessions/21%20Regular/final/SB0202.pdf", "section": "2021 ch.68 \u00a74; \u00a753-12-2(E)(1)\u2013(3)", "claims": [ "Director-only articles provision; owner/compensation-dependent negligence exception; restricted decision settings; prospective effect" ] }, { "id": "NM-report-fee-current", "url": "https://www.nmlegis.gov/Sessions/15%20Regular/final/HB0287.pdf", "section": "2015 ch.66 \u00a71; \u00a753-2-1(A)(16), (E)", "claims": [ "$25 corporate-report base fee; card-service charges separately authorized" ] }, { "id": "NM-current-code-authority", "url": "https://www.sos.nm.gov/business-services/statutes-governing-business-in-nm/", "section": "Official SOS index to NMSA Chapter 53 and Corporate Reports Act", "claims": [ "Official authority for corporation and corporate-report statutes; source links correspond to the enacted provisions checked." ] }, { "label": "New Mexico TRD, corporate income and franchise overview: $50 even inactive", "url": "https://www.tax.newmexico.gov/businesses/corporate-income-franchise-tax-overview/", "checked": "2026-10-11", "section": "New Mexico TRD, corporate income and franchise overview: $50 even inactive" }, { "label": "New Mexico Legislature, enacted HB252, sections 10 and 42-43: flat 5.9% corporate income rate from 2025", "url": "https://www.nmlegis.gov/Sessions/24%20Regular/final/HB0252.pdf", "checked": "2026-10-11", "section": "New Mexico Legislature, enacted HB252, sections 10 and 42-43: flat 5.9% corporate income rate from 2025" }, { "label": "New Mexico Legislature, HB252 enactment record: Chapter 67, March 6, 2024", "url": "https://www.nmlegis.gov/Legislation/Legislation?chamber=H&legNo=252&legType=B&year=24", "checked": "2026-10-11", "section": "New Mexico Legislature, HB252 enactment record: Chapter 67, March 6, 2024" }, { "label": "New Mexico TRD, gross receipts overview: taxable activities, sourcing and current rate schedules", "url": "https://www.tax.newmexico.gov/businesses/gross-receipts-overview/", "checked": "2026-10-11", "section": "New Mexico TRD, gross receipts overview: taxable activities, sourcing and current rate schedules" } ], "differences": [ "Explicit general-benefit test scales to company size and nature.", "Statutory amendments use voting shares and entitled classes, rather than automatic every-class votes.", "No express separate director/officer benefit monetary shield in the compact statute.", "Public-company report preparation by an independent director differs from a separate required benefit-director office.", "Any equity ownership or more than $2,000 director/employee compensation preserves negligence exposure under the ordinary charter clause; this materially limits founder protection." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "Benefit provision \u00a753-12-7 enacted by 2020 ch.61 \u00a71 (HB 118); current codification shows this enactment without later amendments.", "Ordinary \u00a753-12-2 last reenacted by 2021 ch.68 \u00a74 (SB 202), effective July 1, 2021; full director exculpation clause checked in that official signed law.", "Corporate-report fee \u00a753-2-1 last reenacted by 2015 ch.66 \u00a71 (HB 287); current codification retains the $25 base fee. Biennial reporting comes from the later 2018 SB 225 change." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation designation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "New Mexico offers Benefit corporation designation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 8, 8 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "New Mexico has an identified director monetary-protection provision in the compared scope, which earns this credit. New Mexico is unusually restrictive for founders: any ownership, or annual director/employee compensation above $2,000, preserves liability for negligent fiduciary conduct. The limited negligence shield available to unpaid/low-paid nonowner directors does not extend to founder directors.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "New Mexico does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "New Mexico requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "New Mexico earns the benefit-specific credit for company. The compact statute expressly shields the corporation\u2019s benefit-failure liability but does not reproduce model-act director/officer monetary bars.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "New Mexico has no separately credited benefit-specific monetary shield for directors. The compact statute expressly shields the corporation\u2019s benefit-failure liability but does not reproduce model-act director/officer monetary bars.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "New Mexico has no separately credited benefit-specific monetary shield for officers. The compact statute expressly shields the corporation\u2019s benefit-failure liability but does not reproduce model-act director/officer monetary bars.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "New Mexico: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "New Mexico: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "New Mexico: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "New Mexico has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $12.5 + benefit filing $0 = $12.5 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "New Mexico has a compared recurring floor of $62.5 per year, including $50 in identified minimum tax/license charges. Ordinary domestic C corporation operating in New Mexico, no taxable profit. Includes $50 franchise charge only. Variable GRT on receipts may be positive despite no profit and is excluded, along with registry and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Unlike the model, the enacted section does not automatically enfranchise every otherwise nonvoting class for benefit amendments.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "New Mexico: becoming a benefit company requires Two thirds of voting shares; class approval only when that class is entitled to vote. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "New Mexico: changing back requires Same two-thirds voting-share amendment rule; delete required benefit provisions. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "New Mexico requires report access for people outside the company, so it earns public-access credit. Annual public/shareholder benefit report. For a publicly traded benefit corporation, an independent board director prepares it; private companies may appoint one.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "New Mexico: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "New Mexico: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "New Mexico makes a mission duty mandatory, so it earns this credit. Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 12.5, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 62.5, "minimumTaxAnnualized": 50, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 68, 68 ], "tax": { "code": "NM", "incomeSummary": "Corporate income tax is a flat 5.9% of New Mexico taxable income from 2025, replacing the prior brackets. Separately, gross receipts tax can apply to sales/services regardless of profit, with location-specific combined rates and statutory deductions/exemptions.", "recurringSummary": "A corporation having or exercising its New Mexico franchise owes $50 annual franchise tax, even when inactive or owing no corporate income tax. The $50 is separate from income tax and variable GRT.", "formationAnnualTaxFloor": 50, "floorBasis": "Ordinary domestic corporation having its franchise in New Mexico, no special statutory exemption. $50 annual franchise tax; registry fees and variable income/GRT excluded.", "scenarioMinimum": 50, "scenarioBasis": "Ordinary domestic C corporation operating in New Mexico, no taxable profit. Includes $50 franchise charge only. Variable GRT on receipts may be positive despite no profit and is excluded, along with registry and other operating taxes.", "operatingTaxCaution": "New Mexico-source income and nexus determine income/GRT obligations. Multistate apportionment and GRT sourcing differ; an out-of-state formation does not remove tax on New Mexico operations.", "sources": [ { "label": "New Mexico TRD, corporate income and franchise overview: $50 even inactive", "url": "https://www.tax.newmexico.gov/businesses/corporate-income-franchise-tax-overview/", "checked": "2026-10-11", "section": "New Mexico TRD, corporate income and franchise overview: $50 even inactive" }, { "label": "New Mexico Legislature, enacted HB252, sections 10 and 42-43: flat 5.9% corporate income rate from 2025", "url": "https://www.nmlegis.gov/Sessions/24%20Regular/final/HB0252.pdf", "checked": "2026-10-11", "section": "New Mexico Legislature, enacted HB252, sections 10 and 42-43: flat 5.9% corporate income rate from 2025" }, { "label": "New Mexico Legislature, HB252 enactment record: Chapter 67, March 6, 2024", "url": "https://www.nmlegis.gov/Legislation/Legislation?chamber=H&legNo=252&legType=B&year=24", "checked": "2026-10-11", "section": "New Mexico Legislature, HB252 enactment record: Chapter 67, March 6, 2024" }, { "label": "New Mexico TRD, gross receipts overview: taxable activities, sourcing and current rate schedules", "url": "https://www.tax.newmexico.gov/businesses/gross-receipts-overview/", "checked": "2026-10-11", "section": "New Mexico TRD, gross receipts overview: taxable activities, sourcing and current rate schedules" } ] }, "conversion": { "state": "New Mexico", "code": "NM", "form": "Benefit corporation designation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "Two thirds of voting shares; class approval only when that class is entitled to vote.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Unlike the model, the enacted section does not automatically enfranchise every otherwise nonvoting class for benefit amendments.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "id": "NM-enacted", "url": "https://www.nmlegis.gov/Sessions/20%20Regular/final/HB0118.pdf", "section": "2020 enacted HB 118, new \u00a753-12-7(A)\u2013(I)", "claims": [ "Purpose, mandatory consideration, annual public/holder assessment, public-company independent director, corporate damages bar, enforcement and voting provisions" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General social/environmental benefit is mandatory, measured relative to company size and business nature; charter may specify additional purposes.", "difference": "New Mexico offers Benefit corporation designation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "New Mexico is unusually restrictive for founders: any ownership, or annual director/employee compensation above $2,000, preserves liability for negligent fiduciary conduct. The limited negligence shield available to unpaid/low-paid nonowner directors does not extend to founder directors. Benefit-specific rule: The compact statute expressly shields the corporation\u2019s benefit-failure liability but does not reproduce model-act director/officer monetary bars.", "difference": "New Mexico keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. No express separate director/officer benefit monetary shield in the compact statute. Public-company report preparation by an independent director differs from a separate required benefit-director office. Any equity ownership or more than $2,000 director/employee compensation preserves negligence exposure under the ordinary charter clause; this materially limits founder protection." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual public/shareholder benefit report. For a publicly traded benefit corporation, an independent board director prepares it; private companies may appoint one. Assessment rule: Annual social/environmental performance assessment against an independent third-party standard is required. No paid-certification requirement appears in the enacted section.", "difference": "New Mexico: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $12.5 per year on an annualized basis. Minimum tax/license used here: $50. Ordinary domestic C corporation operating in New Mexico, no taxable profit. Includes $50 franchise charge only. Variable GRT on receipts may be positive despite no profit and is excluded, along with registry and other operating taxes.", "difference": "New Mexico has a compared recurring floor of $62.5 per year, including $50 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Two thirds of voting shares; class approval only when that class is entitled to vote. Unlike the model, the enacted section does not automatically enfranchise every otherwise nonvoting class for benefit amendments. Changing back: Same two-thirds voting-share amendment rule; delete required benefit provisions.", "difference": "New Mexico entry uses Two thirds of voting shares; class approval only when that class is entitled to vote.; exit uses Same two-thirds voting-share amendment rule; delete required benefit provisions.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities. Disclosure: Annual public/shareholder benefit report. For a publicly traded benefit corporation, an independent board director prepares it; private companies may appoint one. Enforcement: Corporation direct or enumerated derivative plaintiffs; class ownership can qualify even below 2% total ownership.", "difference": "New Mexico requires public access to the report. Public-company report preparation by an independent director differs from a separate required benefit-director office. Any equity ownership or more than $2,000 director/employee compensation preserves negligence exposure under the ordinary charter clause; this materially limits founder protection." } } }, "guideUrl": "/assets/state-guides/NM.md" }, { "state": "New York", "abbreviation": "NY", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / ordinary-corporate-enforcement model", "features": { "purpose": { "summary": "General benefit required and controls inconsistent other purposes; specific charter benefits optional.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1706", "section": "BSC \u00a71706" } ] }, "board": { "summary": "Directors and officers must consider enumerated stakeholders; charter may prioritize specified benefit. No independent benefit director required.", "mode": "mandatory_consider", "benefitDirectorRequired": "none", "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1707", "section": "BSC \u00a71707" } ] }, "standard": { "summary": "Third-party standard assessment required; no mandatory external certification/audit in Article 17.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1708", "section": "BSC \u00a71708(a)" } ] }, "report": { "summary": "Annual to shareholders within 120 days, latest public online if website and state copy. Lists names of \u22655% owners and director compensation; public copies may omit compensation/financial/proprietary information. No no-website request-copy clause in \u00a71708.", "cadence": "annual", "shareholders": true, "publicWebsite": "most recent report if website", "stateFiling": true, "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1708", "section": "BSC \u00a71708" }, { "url": "https://dos.ny.gov/benefit-corporation-certificate-incorporation-domestic-business-corporations", "section": "Annual Benefit Reports: filing deadline, cover/backer and $60 fee" } ], "public": true }, "enforcement": { "summary": "Article 17 creates no separate benefit-enforcement proceeding or ownership-percentage threshold. Ordinary BSC \u00a7626 permits a record/beneficial shareholder or voting-trust holder to sue derivatively if holding at suit and at the challenged transaction (or receiving by operation of law), with particularized board-demand efforts or reasons for no demand. Under \u00a7627, plaintiffs below 5% of a share class and holding interests worth no more than $50,000 can be required to post security for defense expenses; this is an expense-security rule, not a 5% standing cutoff.", "shareholderThreshold": "Any qualifying shareholder under \u00a7626; \u00a7627 may require expense security below 5% and at fair value \u2264$50,000.", "directorStanding": null, "parentThreshold": null, "otherStanding": "ordinary corporate remedies", "corporationStanding": null, "ordinaryDerivativeProcedure": { "contemporaneousOwnershipRequired": true, "demandOrParticularizedExcusalRequired": true, "securityOwnershipSafeHarborPercent": 5, "securityValueSafeHarbor": "fair value exceeding $50,000", "settlementCourtApprovalRequired": true }, "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1707", "section": "BSC Article 17 \u00a7\u00a71701-1709" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/626", "section": "BSC \u00a7626(a)\u2013(d): shareholder derivative standing, contemporaneous ownership, demand/excusal and settlement approval" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/627", "section": "BSC \u00a7627: security for derivative-action expenses; 5% or fair-value>$50,000 exception" } ] }, "benefitLiability": { "summary": "No standalone director/officer/corporation mission-failure monetary bar in Article 17. Stakeholder consideration is not a director-law violation; beneficiaries alone gain no director duty unless charter/bylaws provide otherwise.", "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false, "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1707", "section": "BSC \u00a71707(b)-(c)" } ] }, "ordinaryExculpation": { "summary": "Charter may exculpate directors against corporation/shareholder damages; exceptions bad faith, intentional misconduct/knowing law violation, actual improper financial profit/advantage and \u00a7719 distribution liability. No officer clause; no retroactive effect.", "director": true, "officer": false, "automatic": false, "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/402", "section": "BSC \u00a7402(b)" } ] }, "statusChange": { "summary": "Entry/exit minimum status vote is 75% of each class/series entitled to vote. Unlike many model states, definition does not extend the vote automatically to every otherwise nonvoting class.", "entryVote": "75% of each entitled voting class/series", "exitVote": "75% of each entitled voting class/series", "optionalLock": false, "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1702", "section": "BSC \u00a71702(d),\u00a7\u00a71704-1705" } ] } }, "costs": { "regularReport": { "amount": 9, "currency": "USD", "cadence": "biennial", "conditions": "Domestic/foreign business-corporation statement every two years, not $9 annually.", "summary": "Domestic/foreign business-corporation statement every two years, not $9 annually.", "sources": [ { "url": "https://dos.ny.gov/biennial-statements-business-corporations-and-limited-liability-companies", "section": "biennial statement fee" } ] }, "benefitReport": { "amount": 60, "currency": "USD", "cadence": "annual", "conditions": "DOS expressly requires $60 with the annual benefit report within 120 days after fiscal year end. Submit the report with a white cover/backer giving its statutory title and the name/address for the filing receipt to Division of Corporations, One Commerce Plaza, 99 Washington Avenue, Albany NY 12231. This is separate from the $9 biennial statement.", "verification": "direct agency filing instructions", "summary": "DOS expressly requires $60 with the annual benefit report within 120 days after fiscal year end. Submit the report with a white cover/backer giving its statutory title and the name/address for the filing receipt to Division of Corporations, One Commerce Plaza, 99 Washington Avenue, Albany NY 12231. This is separate from the $9 biennial statement.", "sources": [ { "url": "https://dos.ny.gov/benefit-corporation-certificate-incorporation-domestic-business-corporations", "section": "Annual Benefit Reports" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/1708", "section": "BSC \u00a71708(d)" } ] }, "minimumTax": { "amount": 25, "currency": "USD", "cadence": "annual", "conditions": "General Article 9-A taxpayer with NY receipts \u2264$100,000. Higher receipts increase minimum; income/capital bases, special manufacturers/technology and S status differ.", "summary": "General Article 9-A taxpayer with NY receipts \u2264$100,000. Higher receipts increase minimum; income/capital bases, special manufacturers/technology and S status differ.", "sources": [ { "url": "https://www.tax.ny.gov/bus/ct/def_art9a.htm", "section": "fixed dollar minimum for general business taxpayers" }, { "label": "New York Tax Department: Article 9-A applicability and three tax bases", "url": "https://www.tax.ny.gov/bus/ct/article9a.htm", "checked": "2026-10-11", "section": "New York Tax Department: Article 9-A applicability and three tax bases" }, { "label": "New York Tax Department: general rates, minimum tiers and MTA district", "url": "https://www.tax.ny.gov/bus/ct/def_art9a.htm", "checked": "2026-10-11", "section": "New York Tax Department: general rates, minimum tiers and MTA district" }, { "label": "New York Tax Department: rates extended through tax years before 2027", "url": "https://www.tax.ny.gov/legal/2023/pit-corp-changes.htm", "checked": "2026-10-11", "section": "New York Tax Department: rates extended through tax years before 2027" }, { "label": "New York Tax Department: adopted corporate regulations, domestic final-year exemption", "url": "https://www.tax.ny.gov/pdf/rulemaking/dec1123/corpreform/text.pdf", "checked": "2026-10-11", "section": "New York Tax Department: adopted corporate regulations, domestic final-year exemption" } ] } }, "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1706", "section": "BSC \u00a71706" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/1707", "section": "BSC \u00a71707" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/1708", "section": "BSC \u00a71708(a)" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/1708", "section": "BSC \u00a71708" }, { "url": "https://dos.ny.gov/benefit-corporation-certificate-incorporation-domestic-business-corporations", "section": "Annual Benefit Reports: filing deadline, cover/backer and $60 fee" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/1707", "section": "BSC Article 17 \u00a7\u00a71701-1709" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/626", "section": "BSC \u00a7626(a)\u2013(d): shareholder derivative standing, contemporaneous ownership, demand/excusal and settlement approval" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/627", "section": "BSC \u00a7627: security for derivative-action expenses; 5% or fair-value>$50,000 exception" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/1707", "section": "BSC \u00a71707(b)-(c)" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/402", "section": "BSC \u00a7402(b)" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/1702", "section": "BSC \u00a71702(d),\u00a7\u00a71704-1705" }, { "url": "https://dos.ny.gov/biennial-statements-business-corporations-and-limited-liability-companies", "section": "biennial statement fee" }, { "url": "https://dos.ny.gov/benefit-corporation-certificate-incorporation-domestic-business-corporations", "section": "Annual Benefit Reports" }, { "url": "https://www.nysenate.gov/legislation/laws/BSC/1708", "section": "BSC \u00a71708(d)" }, { "url": "https://www.tax.ny.gov/bus/ct/def_art9a.htm", "section": "fixed dollar minimum for general business taxpayers" }, { "label": "New York Tax Department: Article 9-A applicability and three tax bases", "url": "https://www.tax.ny.gov/bus/ct/article9a.htm", "checked": "2026-10-11", "section": "New York Tax Department: Article 9-A applicability and three tax bases" }, { "label": "New York Tax Department: general rates, minimum tiers and MTA district", "url": "https://www.tax.ny.gov/bus/ct/def_art9a.htm", "checked": "2026-10-11", "section": "New York Tax Department: general rates, minimum tiers and MTA district" }, { "label": "New York Tax Department: rates extended through tax years before 2027", "url": "https://www.tax.ny.gov/legal/2023/pit-corp-changes.htm", "checked": "2026-10-11", "section": "New York Tax Department: rates extended through tax years before 2027" }, { "label": "New York Tax Department: adopted corporate regulations, domestic final-year exemption", "url": "https://www.tax.ny.gov/pdf/rulemaking/dec1123/corpreform/text.pdf", "checked": "2026-10-11", "section": "New York Tax Department: adopted corporate regulations, domestic final-year exemption" } ], "differences": [ "Higher 75% status-change vote.", "General mission legally controls inconsistent other purposes.", "No special mission-failure damages bar; reports identify owners with at least 5%." ], "gaps": [], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "New York offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 6, 6 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "New York has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter may exculpate directors against corporation/shareholder damages; exceptions bad faith, intentional misconduct/knowing law violation, actual improper financial profit/advantage and \u00a7719 distribution liability. No officer clause; no retroactive effect.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "New York does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "New York requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "New York has no separately credited benefit-specific monetary shield for company. No standalone director/officer/corporation mission-failure monetary bar in Article 17. Stakeholder consideration is not a director-law violation; beneficiaries alone gain no director duty unless charter/bylaws provide otherwise.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "New York has no separately credited benefit-specific monetary shield for directors. No standalone director/officer/corporation mission-failure monetary bar in Article 17. Stakeholder consideration is not a director-law violation; beneficiaries alone gain no director duty unless charter/bylaws provide otherwise.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "New York has no separately credited benefit-specific monetary shield for officers. No standalone director/officer/corporation mission-failure monetary bar in Article 17. Stakeholder consideration is not a director-law violation; beneficiaries alone gain no director duty unless charter/bylaws provide otherwise.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "New York: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "New York: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "New York: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "New York has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $4.5 + benefit filing $60 = $64.5 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "New York has a compared recurring floor of $89.5 per year, including $25 in identified minimum tax/license charges. Small active ordinary domestic C corporation in a regular year, New York receipts no more than $100,000, no taxable profit, qualifies for the small-business capital-base exemption or has capital tax no greater than $25, and operates outside the MCTD and New York City. Special emerging-technology status is not assumed. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 8, 8 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 4, 4 ], "reason": "Entry/exit minimum status vote is 75% of each class/series entitled to vote. Unlike many model states, definition does not extend the vote automatically to every otherwise nonvoting class.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "New York: becoming a benefit company requires 75% of each entitled voting class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 4, 4 ], "reason": "Three-quarters default benefit exit gate: 4 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "New York: changing back requires 75% of each entitled voting class/series. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "New York requires report access for people outside the company, so it earns public-access credit. Annual to shareholders within 120 days, latest public online if website and state copy. Lists names of \u22655% owners and director compensation; public copies may omit compensation/financial/proprietary information. No no-website request-copy clause in \u00a71708.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "New York: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "New York: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "New York makes a mission duty mandatory, so it earns this credit. Directors and officers must consider enumerated stakeholders; charter may prioritize specified benefit. No independent benefit director required.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 64.5, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "three_quarters", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 89.5, "minimumTaxAnnualized": 25, "entryCategory": "three_quarters" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Three-quarters default" }, "scoreRange": [ 61, 61 ], "tax": { "code": "NY", "incomeSummary": "New York Article 9-A general C corporations pay 6.5% of the business-income base, or 7.25% on the entire base when it exceeds $5 million; the higher rate covers 2026. Qualified manufacturers and emerging-technology companies have special rates. Tax is the highest of business income, business capital or fixed-dollar minimum, plus any applicable MTA surcharge.", "recurringSummary": "The general fixed-dollar minimum is $25 when New York receipts are no more than $100,000, rising by receipts tiers to $200,000. The general capital-base rate is 0.1875% for 2026, capped at $5 million; qualified small businesses and other specified classes are exempt from that base. A qualifying final-return/inactive domestic corporation can stop the minimum in later years.", "formationAnnualTaxFloor": null, "floorBasis": "The ordinary lowest active Article 9-A minimum is $25, but domestic status alone is not an unconditional floor because the official final-tax-year exemption can remove subsequent fixed-dollar minima. Excludes biennial registry fees, MTA surcharge, NYC taxes, higher income/capital and special QETC/manufacturer rules.", "scenarioMinimum": 25, "scenarioBasis": "Small active ordinary domestic C corporation in a regular year, New York receipts no more than $100,000, no taxable profit, qualifies for the small-business capital-base exemption or has capital tax no greater than $25, and operates outside the MCTD and New York City. Special emerging-technology status is not assumed.", "operatingTaxCaution": "Article 9-A covers New York incorporation and specified business, capital, property, office or receipt activity of foreign corporations. The MCTD imposes an additional surcharge in listed counties; NYC has separate business taxes. Customer-market sourcing and combined returns mean a charter outside New York is not a tax escape.", "sources": [ { "label": "New York Tax Department: Article 9-A applicability and three tax bases", "url": "https://www.tax.ny.gov/bus/ct/article9a.htm", "checked": "2026-10-11", "section": "New York Tax Department: Article 9-A applicability and three tax bases" }, { "label": "New York Tax Department: general rates, minimum tiers and MTA district", "url": "https://www.tax.ny.gov/bus/ct/def_art9a.htm", "checked": "2026-10-11", "section": "New York Tax Department: general rates, minimum tiers and MTA district" }, { "label": "New York Tax Department: rates extended through tax years before 2027", "url": "https://www.tax.ny.gov/legal/2023/pit-corp-changes.htm", "checked": "2026-10-11", "section": "New York Tax Department: rates extended through tax years before 2027" }, { "label": "New York Tax Department: adopted corporate regulations, domestic final-year exemption", "url": "https://www.tax.ny.gov/pdf/rulemaking/dec1123/corpreform/text.pdf", "checked": "2026-10-11", "section": "New York Tax Department: adopted corporate regulations, domestic final-year exemption" } ] }, "conversion": { "state": "New York", "code": "NY", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "75% of each entitled voting class/series", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry/exit minimum status vote is 75% of each class/series entitled to vote. Unlike many model states, definition does not extend the vote automatically to every otherwise nonvoting class.", "proposal": "Consider lowering the 75% of each entitled class/series entry gate to ordinary amendment requirements.", "sources": [ { "url": "https://www.nysenate.gov/legislation/laws/BSC/1702", "section": "BSC \u00a71702(d),\u00a7\u00a71704-1705" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General benefit required and controls inconsistent other purposes; specific charter benefits optional.", "difference": "New York offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter may exculpate directors against corporation/shareholder damages; exceptions bad faith, intentional misconduct/knowing law violation, actual improper financial profit/advantage and \u00a7719 distribution liability. No officer clause; no retroactive effect. Benefit-specific rule: No standalone director/officer/corporation mission-failure monetary bar in Article 17. Stakeholder consideration is not a director-law violation; beneficiaries alone gain no director duty unless charter/bylaws provide otherwise.", "difference": "New York keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. No special mission-failure damages bar; reports identify owners with at least 5%." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders within 120 days, latest public online if website and state copy. Lists names of \u22655% owners and director compensation; public copies may omit compensation/financial/proprietary information. No no-website request-copy clause in \u00a71708. Assessment rule: Third-party standard assessment required; no mandatory external certification/audit in Article 17.", "difference": "New York: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $64.5 per year on an annualized basis. Minimum tax/license used here: $25. Small active ordinary domestic C corporation in a regular year, New York receipts no more than $100,000, no taxable profit, qualifies for the small-business capital-base exemption or has capital tax no greater than $25, and operates outside the MCTD and New York City. Special emerging-technology status is not assumed.", "difference": "New York has a compared recurring floor of $89.5 per year, including $25 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 75% of each entitled voting class/series. Entry/exit minimum status vote is 75% of each class/series entitled to vote. Unlike many model states, definition does not extend the vote automatically to every otherwise nonvoting class. Changing back: 75% of each entitled voting class/series", "difference": "New York entry uses 75% of each entitled voting class/series; exit uses 75% of each entitled voting class/series. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors and officers must consider enumerated stakeholders; charter may prioritize specified benefit. No independent benefit director required. Disclosure: Annual to shareholders within 120 days, latest public online if website and state copy. Lists names of \u22655% owners and director compensation; public copies may omit compensation/financial/proprietary information. No no-website request-copy clause in \u00a71708. Enforcement: Article 17 creates no separate benefit-enforcement proceeding or ownership-percentage threshold. Ordinary BSC \u00a7626 permits a record/beneficial shareholder or voting-trust holder to sue derivatively if holding at suit and at the challenged transaction (or receiving by operation of law), with particularized board-demand efforts or reasons for no demand. Under \u00a7627, plaintiffs below 5% of a share class and holding interests worth no more than $50,000 can be required to post security for defense expenses; this is an expense-security rule, not a 5% standing cutoff.", "difference": "New York requires public access to the report. No special mission-failure damages bar; reports identify owners with at least 5%." } } }, "guideUrl": "/assets/state-guides/NY.md" }, { "state": "North Carolina", "abbreviation": "NC", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "reviewed": "2026-10-11", "family": "no dedicated form identified", "features": { "purpose": { "summary": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ], "generalRequired": null, "specificRequired": null, "specificOptional": null }, "board": { "summary": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ], "mode": "ordinary_corporation" }, "standard": { "summary": "No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ], "thirdPartyRequired": null, "certificationRequired": null }, "report": { "summary": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ], "cadence": "not_applicable", "shareholders": null, "publicWebsite": null, "stateFiling": null, "public": null }, "enforcement": { "summary": "No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ], "shareholderThreshold": "No dedicated benefit proceeding" }, "benefitLiability": { "summary": "No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "2025-amended opt-in charter provision covers directors and eligible officers. Officer corporation/derivative actions excluded; exceptions include known conflict with company interests, improper benefit and director distributions.", "sources": [ { "url": "https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_55/GS_55-2-02.html", "section": "\u00a755-2-02(b)(3)" } ], "director": true, "officer": true, "automatic": false }, "statusChange": { "summary": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ], "entryVote": "not_applicable", "exitVote": "not_applicable", "optionalLock": false } }, "costs": { "regularReport": { "amount": 18, "cadence": "annual", "conditions": "Statutory electronic annual report $18, paper $25; portal transaction fees additional.", "summary": "Statutory electronic annual report $18, paper $25; portal transaction fees additional.", "sources": [ { "url": "https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_55/GS_55-1-22.html", "section": "Corporate report fees" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate statutory benefit form/report identified.", "summary": "No separate statutory benefit form/report identified.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ] }, "minimumTax": { "amount": 200, "conditions": "General corporation franchise tax has a $200 minimum. C-corporation rate is $1.50 per $1,000 of the tax base, capped at $500 on the first $1 million under the current rule; the 2026 corporate income-tax rate is 2%. Income tax and foreign-state obligations are additional and activity-dependent.", "summary": "General corporation franchise tax has a $200 minimum. C-corporation rate is $1.50 per $1,000 of the tax base, capped at $500 on the first $1 million under the current rule; the 2026 corporate income-tax rate is 2%. Income tax and foreign-state obligations are additional and activity-dependent.", "sources": [ { "url": "https://www.ncdor.gov/taxes-forms/corporate-income-franchise-tax/corporate-income-and-franchise-tax-rates", "section": "2026 income rate and current $200 franchise minimum" }, { "label": "North Carolina DOR: current income and franchise tax rates", "url": "https://www.ncdor.gov/taxes-forms/corporate-income-franchise-tax/corporate-income-and-franchise-tax-rates", "checked": "2026-10-11", "section": "North Carolina DOR: current income and franchise tax rates" }, { "label": "North Carolina statute: section 105-122 franchise tax", "url": "https://ncleg.gov/EnactedLegislation/Statutes/HTML/ByChapter/Chapter_105.html", "checked": "2026-10-11", "section": "North Carolina statute: section 105-122 franchise tax" } ] } }, "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" }, { "url": "https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_55/GS_55-2-02.html", "section": "\u00a755-2-02(b)(3)" }, { "url": "https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_55/GS_55-1-22.html", "section": "Corporate report fees" }, { "url": "https://www.ncdor.gov/taxes-forms/corporate-income-franchise-tax/corporate-income-and-franchise-tax-rates", "section": "2026 income rate and current $200 franchise minimum" }, { "label": "North Carolina DOR: current income and franchise tax rates", "url": "https://www.ncdor.gov/taxes-forms/corporate-income-franchise-tax/corporate-income-and-franchise-tax-rates", "checked": "2026-10-11", "section": "North Carolina DOR: current income and franchise tax rates" }, { "label": "North Carolina statute: section 105-122 franchise tax", "url": "https://ncleg.gov/EnactedLegislation/Statutes/HTML/ByChapter/Chapter_105.html", "checked": "2026-10-11", "section": "North Carolina statute: section 105-122 franchise tax" } ], "differences": [ "2025-amended opt-in charter provision covers directors and eligible officers. Officer corporation/derivative actions excluded; exceptions include known conflict with company interests, improper benefit and director distributions.", "Statutory electronic annual report $18, paper $25; portal transaction fees additional.", "The form-availability gap is the only shared grouping; ordinary protections and charges differ." ], "gaps": [ "Ordinary charter protections concern specified internal monetary claims; personally committed wrongs and liabilities imposed by other statutes remain separate." ], "confidence": "Current fee source; official ordinary-code verification where stated", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 0, 0 ], "reason": "No dedicated for-profit benefit form identified. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "North Carolina has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason. A nonprofit public-benefit corporation is a different entity and does not fill this for-profit gap.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 10, 10 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "North Carolina has an identified director monetary-protection provision in the compared scope, which earns this credit. 2025-amended opt-in charter provision covers directors and eligible officers. Officer corporation/derivative actions excluded; exceptions include known conflict with company interests, improper benefit and director distributions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 4, 4 ], "reason": "The model assigns 4 points to this designated eligible-officer provision; officer eligibility and excluded claims remain in the legal record.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "North Carolina extends ordinary protection to officers in a limited eligible-officer scope, so it receives less credit than the broader officer category. 2025-amended opt-in charter provision covers directors and eligible officers. Officer corporation/derivative actions excluded; exceptions include known conflict with company interests, improper benefit and director distributions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "North Carolina requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "North Carolina has no separately credited benefit-specific monetary shield for company. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "North Carolina has no separately credited benefit-specific monetary shield for directors. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "North Carolina has no separately credited benefit-specific monetary shield for officers. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 0, 0 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "North Carolina: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "North Carolina: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "North Carolina: No dedicated form. No dedicated benefit form means this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "North Carolina has no dedicated benefit form, so this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 6, 6 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 6, 6 ], "reason": "Ordinary reporting $18 + benefit filing $0 = $18 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "North Carolina has a compared recurring floor of $218 per year, including $200 in identified minimum tax/license charges. Small active domestic C corporation in a regular year, no taxable profit and sufficiently low franchise net-worth base that the calculation remains $200. Registry reporting and other taxes are excluded. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "North Carolina: becoming a benefit company requires No dedicated for-profit benefit election applies. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "North Carolina: changing back requires not_applicable. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "North Carolina has no dedicated benefit-report rule in this ordinary form, so it receives no benefit-publication credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "North Carolina: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "North Carolina: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "North Carolina has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 18, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "not_applicable", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 218, "minimumTaxAnnualized": 200, "entryCategory": "not_applicable" }, "grouping": { "assessment": "No dedicated form", "cadence": "No dedicated form", "filing": "No dedicated form", "ordinaryScope": "Director and officer scope", "exit": "No dedicated form" }, "scoreRange": [ 16, 16 ], "tax": { "code": "NC", "incomeSummary": "North Carolina corporate income tax is 2% for tax years beginning in 2026, on North Carolina net taxable income. The official rate page distinguishes 2025's 2.25% and prior years; the income rate should not be mistaken for the total corporate tax burden.", "recurringSummary": "An ordinary C corporation also pays franchise tax of $1.50 per $1,000 of the tax base, subject to a $500 maximum on the first $1 million and an overall $200 minimum under the current rule. S corporations have a different $200-first-$1-million formula. Annual reports are separate.", "formationAnnualTaxFloor": 200, "floorBasis": "$200 ordinary nonexempt corporation franchise minimum for the privilege of doing business and continuing domestic articles, separate from the annual-report fee. Net worth and income can increase liability; holding-company and exempt-entity rules differ.", "scenarioMinimum": 200, "scenarioBasis": "Small active domestic C corporation in a regular year, no taxable profit and sufficiently low franchise net-worth base that the calculation remains $200. Registry reporting and other taxes are excluded.", "operatingTaxCaution": "G.S. 105-122 uses book net worth with statutory adjustments, not simply taxable profits. The revenue agency taxes corporations chartered or doing business in North Carolina; income and franchise allocation/apportionment rules and nexus must be examined for actual North Carolina activity.", "sources": [ { "label": "North Carolina DOR: current income and franchise tax rates", "url": "https://www.ncdor.gov/taxes-forms/corporate-income-franchise-tax/corporate-income-and-franchise-tax-rates", "checked": "2026-10-11", "section": "North Carolina DOR: current income and franchise tax rates" }, { "label": "North Carolina statute: section 105-122 franchise tax", "url": "https://ncleg.gov/EnactedLegislation/Statutes/HTML/ByChapter/Chapter_105.html", "checked": "2026-10-11", "section": "North Carolina statute: section 105-122 franchise tax" } ] }, "conversion": { "state": "North Carolina", "code": "NC", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "group": "gap", "groupLabel": "Enact a benefit option", "entryVote": "No dedicated for-profit benefit election applies", "route": "No same-state benefit-status amendment route identified; a benefit chapter is needed. A move to another jurisdiction requires its own authorized domestication, conversion or merger route.", "currentDetail": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "proposal": "Enact a for-profit benefit chapter with a same-company amendment route, ordinary amendment voting and usable agency forms.", "sources": [ { "url": "https://www.ncleg.gov/Laws/GeneralStatuteSections/Chapter55", "section": "General Statutes Chapter 55" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "difference": "North Carolina has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "2025-amended opt-in charter provision covers directors and eligible officers. Officer corporation/derivative actions excluded; exceptions include known conflict with company interests, improper benefit and director distributions. Benefit-specific rule: No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "difference": "North Carolina adds ordinary officer coverage; the charter must elect the ordinary protection. 2025-amended opt-in charter provision covers directors and eligible officers. Officer corporation/derivative actions excluded; exceptions include known conflict with company interests, improper benefit and director distributions." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Assessment rule: No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "difference": "No benefit reporting credit applies because this state does not offer the requested form; that does not mean an ordinary company has no filings." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $18 per year on an annualized basis. Minimum tax/license used here: $200. Small active domestic C corporation in a regular year, no taxable profit and sufficiently low franchise net-worth base that the calculation remains $200. Registry reporting and other taxes are excluded.", "difference": "North Carolina has a compared recurring floor of $218 per year, including $200 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: No dedicated for-profit benefit election applies. Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules. Changing back: not_applicable", "difference": "No direct benefit-status election or exit exists in this state; an interstate move or a law change is a different process." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute. Disclosure: No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Enforcement: No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "difference": "The ordinary corporation has no dedicated statutory benefit duty/report in this reviewed form. That is why it receives no benefit-accountability credit." } } }, "guideUrl": "/assets/state-guides/NC.md" }, { "state": "North Dakota", "abbreviation": "ND", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "reviewed": "2026-10-11", "family": "no dedicated form identified", "features": { "purpose": { "summary": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ], "generalRequired": null, "specificRequired": null, "specificOptional": null }, "board": { "summary": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ], "mode": "ordinary_corporation" }, "standard": { "summary": "No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ], "thirdPartyRequired": null, "certificationRequired": null }, "report": { "summary": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ], "cadence": "not_applicable", "shareholders": null, "publicWebsite": null, "stateFiling": null, "public": null }, "enforcement": { "summary": "No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ], "shareholderThreshold": "No dedicated benefit proceeding" }, "benefitLiability": { "summary": "No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "Director-only opt-in charter limitation, subject to loyalty, bad faith, misconduct, knowing illegality, specified statutory and improper-benefit exceptions. Ordinary directors may already consider listed nonshareholder constituencies.", "sources": [ { "url": "https://ndlegis.gov/cencode/t10c19-1.pdf", "section": "\u00a710-19.1-50(5)\u2013(6)" } ], "director": true, "officer": false, "automatic": false }, "statusChange": { "summary": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ], "entryVote": "not_applicable", "exitVote": "not_applicable", "optionalLock": false } }, "costs": { "regularReport": { "amount": 25, "cadence": "annual", "conditions": "Annual corporate report $25.", "summary": "Annual corporate report $25.", "sources": [ { "url": "https://www.sos.nd.gov/business/business-services/business-structures/corporation", "section": "Corporate report fees" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate statutory benefit form/report identified.", "summary": "No separate statutory benefit form/report identified.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ] }, "minimumTax": { "amount": null, "conditions": "Corporate income tax is graduated from 1.41% to 4.31% of North Dakota taxable income, with allocation/apportionment. This income-based tax is separate from the annual corporate report. S-corporation taxation generally passes through to owners; nonresident withholding rules can apply.", "summary": "Corporate income tax is graduated from 1.41% to 4.31% of North Dakota taxable income, with allocation/apportionment. This income-based tax is separate from the annual corporate report. S-corporation taxation generally passes through to owners; nonresident withholding rules can apply.", "sources": [ { "url": "https://www.tax.nd.gov/new-businesses-and-contractors", "section": "Corporate income rates and pass-through treatment" }, { "label": "North Dakota Tax Commissioner: current brackets, water's-edge surtax, and filing scope", "url": "https://www.tax.nd.gov/corporate-income-tax", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: current brackets, water's-edge surtax, and filing scope" }, { "label": "North Dakota Tax Commissioner: 2025 corporation income-tax instructions and calculation", "url": "https://www.tax.nd.gov/sites/www/files/documents/forms/business/corporate-income/2025-corp/28714-corp-income-tax-booklet-2025.pdf", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: 2025 corporation income-tax instructions and calculation" }, { "label": "North Dakota Tax Commissioner: business tax guidance and apportionment elections", "url": "https://www.tax.nd.gov/sites/www/files/documents/news-center/publications/business-tax-incentives.pdf", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: business tax guidance and apportionment elections" } ] } }, "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" }, { "url": "https://ndlegis.gov/cencode/t10c19-1.pdf", "section": "\u00a710-19.1-50(5)\u2013(6)" }, { "url": "https://www.sos.nd.gov/business/business-services/business-structures/corporation", "section": "Corporate report fees" }, { "url": "https://www.tax.nd.gov/new-businesses-and-contractors", "section": "Corporate income rates and pass-through treatment" }, { "label": "North Dakota Tax Commissioner: current brackets, water's-edge surtax, and filing scope", "url": "https://www.tax.nd.gov/corporate-income-tax", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: current brackets, water's-edge surtax, and filing scope" }, { "label": "North Dakota Tax Commissioner: 2025 corporation income-tax instructions and calculation", "url": "https://www.tax.nd.gov/sites/www/files/documents/forms/business/corporate-income/2025-corp/28714-corp-income-tax-booklet-2025.pdf", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: 2025 corporation income-tax instructions and calculation" }, { "label": "North Dakota Tax Commissioner: business tax guidance and apportionment elections", "url": "https://www.tax.nd.gov/sites/www/files/documents/news-center/publications/business-tax-incentives.pdf", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: business tax guidance and apportionment elections" } ], "differences": [ "Director-only opt-in charter limitation, subject to loyalty, bad faith, misconduct, knowing illegality, specified statutory and improper-benefit exceptions. Ordinary directors may already consider listed nonshareholder constituencies.", "Annual corporate report $25.", "The form-availability gap is the only shared grouping; ordinary protections and charges differ." ], "gaps": [ "Ordinary charter protections concern specified internal monetary claims; personally committed wrongs and liabilities imposed by other statutes remain separate." ], "confidence": "Current fee source; official ordinary-code verification where stated", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 0, 0 ], "reason": "No dedicated for-profit benefit form identified. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "North Dakota has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason. A nonprofit public-benefit corporation is a different entity and does not fill this for-profit gap.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 6, 6 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "North Dakota has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only opt-in charter limitation, subject to loyalty, bad faith, misconduct, knowing illegality, specified statutory and improper-benefit exceptions. Ordinary directors may already consider listed nonshareholder constituencies.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "North Dakota does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "North Dakota requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "North Dakota has no separately credited benefit-specific monetary shield for company. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "North Dakota has no separately credited benefit-specific monetary shield for directors. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "North Dakota has no separately credited benefit-specific monetary shield for officers. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 0, 0 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "North Dakota: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "North Dakota: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "North Dakota: No dedicated form. No dedicated benefit form means this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "North Dakota has no dedicated benefit form, so this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $25 + benefit filing $0 = $25 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "North Dakota has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation operating in North Dakota with no North Dakota taxable income after adjustments and apportionment: $0 regular corporate tax and no separate general franchise/capital minimum. Even an applicable water's-edge surtax has a zero taxable base in this scenario. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "North Dakota: becoming a benefit company requires No dedicated for-profit benefit election applies. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "North Dakota: changing back requires not_applicable. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "North Dakota has no dedicated benefit-report rule in this ordinary form, so it receives no benefit-publication credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "North Dakota: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "North Dakota: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "North Dakota has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 25, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "not_applicable", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 25, "minimumTaxAnnualized": 0, "entryCategory": "not_applicable" }, "grouping": { "assessment": "No dedicated form", "cadence": "No dedicated form", "filing": "No dedicated form", "ordinaryScope": "Director scope only", "exit": "No dedicated form" }, "scoreRange": [ 21, 21 ], "tax": { "code": "ND", "incomeSummary": "North Dakota ordinary corporate income tax has marginal rates of 1.41% on the first $25,000, 3.55% on the next $25,000, and 4.31% above $50,000 of North Dakota taxable income. A water's-edge filing election adds a 3.5% surtax on North Dakota taxable income. The regular rates have remained unchanged since 2015.", "recurringSummary": "The ordinary civic/technology stock C corporation has no separate general fixed franchise/capital minimum in the current corporate income-tax computation. Tax follows North Dakota taxable income; bank taxation and Secretary of State annual report fees are separate. The water's-edge surtax is income-based, not a flat charge.", "formationAnnualTaxFloor": null, "floorBasis": "No positive charter-only annual minimum for an ordinary domestic stock C corporation in the cited current corporate tax regime. This excludes annual report charges and specialized financial-institution taxation.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation operating in North Dakota with no North Dakota taxable income after adjustments and apportionment: $0 regular corporate tax and no separate general franchise/capital minimum. Even an applicable water's-edge surtax has a zero taxable base in this scenario.", "operatingTaxCaution": "Corporations doing business in or earning North Dakota-source income generally file Form 40. State adjustments, allocation/apportionment, combined reporting, and filing elections affect taxable income. The usual apportionment is three-factor property/payroll/sales, with an elective single-sales-factor method; an incorporation-state comparison does not determine tax on actual operations.", "sources": [ { "label": "North Dakota Tax Commissioner: current brackets, water's-edge surtax, and filing scope", "url": "https://www.tax.nd.gov/corporate-income-tax", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: current brackets, water's-edge surtax, and filing scope" }, { "label": "North Dakota Tax Commissioner: 2025 corporation income-tax instructions and calculation", "url": "https://www.tax.nd.gov/sites/www/files/documents/forms/business/corporate-income/2025-corp/28714-corp-income-tax-booklet-2025.pdf", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: 2025 corporation income-tax instructions and calculation" }, { "label": "North Dakota Tax Commissioner: business tax guidance and apportionment elections", "url": "https://www.tax.nd.gov/sites/www/files/documents/news-center/publications/business-tax-incentives.pdf", "checked": "2026-10-11", "section": "North Dakota Tax Commissioner: business tax guidance and apportionment elections" } ] }, "conversion": { "state": "North Dakota", "code": "ND", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "group": "gap", "groupLabel": "Enact a benefit option", "entryVote": "No dedicated for-profit benefit election applies", "route": "No same-state benefit-status amendment route identified; a benefit chapter is needed. A move to another jurisdiction requires its own authorized domestication, conversion or merger route.", "currentDetail": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "proposal": "Enact a for-profit benefit chapter with a same-company amendment route, ordinary amendment voting and usable agency forms.", "sources": [ { "url": "https://ndlegis.gov/general-information/north-dakota-century-code/index.html", "section": "Century Code Title 10; Chapter 10-19.1" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "difference": "North Dakota has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only opt-in charter limitation, subject to loyalty, bad faith, misconduct, knowing illegality, specified statutory and improper-benefit exceptions. Ordinary directors may already consider listed nonshareholder constituencies. Benefit-specific rule: No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "difference": "North Dakota keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Director-only opt-in charter limitation, subject to loyalty, bad faith, misconduct, knowing illegality, specified statutory and improper-benefit exceptions. Ordinary directors may already consider listed nonshareholder constituencies." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Assessment rule: No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "difference": "No benefit reporting credit applies because this state does not offer the requested form; that does not mean an ordinary company has no filings." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $25 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation operating in North Dakota with no North Dakota taxable income after adjustments and apportionment: $0 regular corporate tax and no separate general franchise/capital minimum. Even an applicable water's-edge surtax has a zero taxable base in this scenario.", "difference": "North Dakota has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: No dedicated for-profit benefit election applies. Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules. Changing back: not_applicable", "difference": "No direct benefit-status election or exit exists in this state; an interstate move or a law change is a different process." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute. Disclosure: No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Enforcement: No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "difference": "The ordinary corporation has no dedicated statutory benefit duty/report in this reviewed form. That is why it receives no benefit-accountability credit." } } }, "guideUrl": "/assets/state-guides/ND.md" }, { "state": "Ohio", "abbreviation": "OH", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "charter-specific beneficial purpose; discretionary other stakeholders", "features": { "purpose": { "generalRequired": false, "specificRequired": true, "specificOptional": false, "summary": "Articles must expressly state one or more beneficial purposes; any ordinary lawful-profit purpose alone does not qualify. No whole-society/environment general-benefit mandate.", "sources": [ { "id": "OH-purpose", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.03", "section": "\u00a71701.03(A)(5)", "claims": [ "Express beneficial purpose and exchange-listed conversion restriction" ] } ] }, "board": { "model": "purpose_required_other_stakeholders_discretionary", "summary": "Directors shall consider shareholders, stated beneficial purposes and any charter priority/balancing method. Other stakeholder groups may be considered.", "sources": [ { "id": "OH-director", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.59", "section": "\u00a71701.59(D)\u2013(G)", "claims": [ "Mandatory shareholder/benefit factors, permissive stakeholders, automatic director monetary rule, exceptions" ] } ], "mode": "purpose_required_other_stakeholders_discretionary" }, "standard": { "thirdPartyStandard": "not_required", "certificationRequired": false, "summary": "No annual independent-standard assessment or certification mandate in the benefit provisions.", "sources": [ { "id": "OH-purpose", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.03", "section": "\u00a71701.03(A)(5)", "claims": [ "Express beneficial purpose and exchange-listed conversion restriction" ] }, { "id": "OH-enforcement", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.96", "section": "\u00a71701.96(A)\u2013(D)", "claims": [ "Company purpose-damages bar, 25%/$2m standing, preservation of other-law/contract remedies" ] } ], "thirdPartyRequired": false }, "report": { "cadence": "none_statutory", "shareholders": false, "public": false, "stateFiling": false, "deadline": "No annual benefit-report mandate identified. Charter and contracts can create additional duties.", "redactions": "Not applicable to a statutory benefit report.", "summary": "No default annual benefit report, public report or third-party-standard assessment under the benefit provisions.", "sources": [ { "id": "OH-purpose", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.03", "section": "\u00a71701.03(A)(5)", "claims": [ "Express beneficial purpose and exchange-listed conversion restriction" ] }, { "id": "OH-enforcement", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.96", "section": "\u00a71701.96(A)\u2013(D)", "claims": [ "Company purpose-damages bar, 25%/$2m standing, preservation of other-law/contract remedies" ] } ] }, "enforcement": { "threshold": "Director; holders entitled to exercise at least 25% of all outstanding voting shares, unless articles/regulations lower it; listed/qualifying OTC shares worth at least $2m; authorized others.", "summary": "Corporation may sue directly. Default derivative benefit-purpose standing is much narrower than 2% or any-shareholder states.", "sources": [ { "id": "OH-enforcement", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.96", "section": "\u00a71701.96(A)\u2013(D)", "claims": [ "Company purpose-damages bar, 25%/$2m standing, preservation of other-law/contract remedies" ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to seek/achieve or comply with stated beneficial-purpose obligations.", "directors": "Ordinary \u00a71701.59(E) automatically protects covered director conduct absent clear-and-convincing deliberate intent to injure the corporation or reckless disregard for its best interests, unless expressly opted out.", "officers": "No separate benefit-purpose officer shield found in \u00a71701.96; director default does not automatically cover officer capacity.", "summary": "\u00a71701.96(D) expressly preserves other legal and contractual duties/remedies. This is no defense to campaign-finance penalties or non-purpose claims.", "sources": [ { "id": "OH-director", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.59", "section": "\u00a71701.59(D)\u2013(G)", "claims": [ "Mandatory shareholder/benefit factors, permissive stakeholders, automatic director monetary rule, exceptions" ] }, { "id": "OH-enforcement", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.96", "section": "\u00a71701.96(A)\u2013(D)", "claims": [ "Company purpose-damages bar, 25%/$2m standing, preservation of other-law/contract remedies" ] } ] }, "ordinaryExculpation": { "scope": "directors acting as directors", "activation": "Automatic \u00a71701.59(E) rule; articles/regulations can opt out by specific reference.", "exceptions": [ "Clear and convincing deliberate intent to injure corporation or reckless disregard", "\u00a71701.95 specified liability", "Interested-transaction liability under \u00a71701.60 preserved", "Liability when acting in another capacity preserved", "Specified unequal-consideration change-of-control transactions preserved" ], "summary": "A statutory default director protection, rather than merely an optional charter clause; ordinary exceptions and capacity limits remain.", "sources": [ { "id": "OH-director", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.59", "section": "\u00a71701.59(D)\u2013(G)", "claims": [ "Mandatory shareholder/benefit factors, permissive stakeholders, automatic director monetary rule, exceptions" ] } ] }, "statusChange": { "entryVote": "Ordinary articles amendment: default two thirds voting power, charter can vary but not below majority; applicable class votes still required.", "exitVote": "Ordinary articles amendment rule.", "lock": "An initially purpose-free corporation whose shares are listed on a national exchange may not later add beneficial purpose under \u00a71701.03(A)(5).", "summary": "No model-act automatic every-class two-thirds status vote. Public-exchange timing can block a later benefit-purpose amendment.", "sources": [ { "id": "OH-vote", "url": "https://codes.ohio.gov/assets/laws/revised-code/authenticated/17/1701/1701.71/7-10-2014/1701.71-7-10-2014.pdf", "section": "\u00a71701.71(A)(1)(a),(B)", "claims": [ "Default two-thirds voting power, charter variable not below majority, applicable class votes" ] } ] } }, "costs": { "regularReport": { "amount": 0, "cadence": "none", "conditions": "Ordinary for-profit corporation has no annual/biennial SOS report requirement; professional associations and LLPs differ.", "summary": "Ordinary for-profit corporation has no annual/biennial SOS report requirement; professional associations and LLPs differ.", "sources": [ { "id": "OH-reports", "url": "https://www.ohiosos.gov/public-integrity/protect-your-business/important-warnings", "section": "Annual-report solicitation warning", "claims": [ "Ordinary corporation annual report not required; LLP/professional exceptions" ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No state annual benefit-report filing requirement.", "summary": "No state annual benefit-report filing requirement.", "sources": [ { "id": "OH-purpose", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.03", "section": "\u00a71701.03(A)(5)", "claims": [ "Express beneficial purpose and exchange-listed conversion restriction" ] }, { "id": "OH-enforcement", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.96", "section": "\u00a71701.96(A)\u2013(D)", "claims": [ "Company purpose-damages bar, 25%/$2m standing, preservation of other-law/contract remedies" ] } ] }, "minimumTax": { "amount": 0, "cadence": "annual", "conditions": "Corporation franchise tax ended after 2013. CAT annual minimum tax ended in2024. From2025 forward, general businesses with Ohio taxable gross receipts of $6 million or less are excluded from CAT; above the exclusion CAT is 0.26% with nexus and group rules. $0 fixed minimum is not exemption from CAT, municipal or other taxes.", "summary": "Corporation franchise tax ended after 2013. CAT annual minimum tax ended in2024. From2025 forward, general businesses with Ohio taxable gross receipts of $6 million or less are excluded from CAT; above the exclusion CAT is 0.26% with nexus and group rules. $0 fixed minimum is not exemption from CAT, municipal or other taxes.", "sources": [ { "id": "OH-tax-franchise", "url": "https://tax.ohio.gov/business/corporation-franchise-tax", "section": "Corporation franchise tax ended after 2013", "claims": [ "Franchise tax no longer applies for 2014 onward." ] }, { "id": "OH-tax-CAT", "url": "https://tax.ohio.gov/business/commercial-activity-tax/commercial-activity-tax", "section": "2025-forward exclusion, annual-minimum repeal and rates", "claims": [ "CAT annual minimum eliminated from 2024; $6 million exclusion from 2025; 0.26% rate; Ohio nexus/group and quarterly-filing rules." ] }, { "label": "Ohio Taxation: Corporation Franchise Tax ended after 2013", "url": "https://tax.ohio.gov/business/corporation-franchise-tax", "checked": "2026-10-11", "section": "Ohio Taxation: Corporation Franchise Tax ended after 2013" }, { "label": "Ohio Taxation: CAT rate, 2025-forward exclusion, annual-minimum repeal, nexus, and group rules", "url": "https://tax.ohio.gov/business/commercial-activity-tax/commercial-activity-tax", "checked": "2026-10-11", "section": "Ohio Taxation: CAT rate, 2025-forward exclusion, annual-minimum repeal, nexus, and group rules" }, { "label": "Ohio Taxation: separate municipal net-profit tax regime", "url": "https://tax.ohio.gov/business/municipal-net-profit-tax", "checked": "2026-10-11", "section": "Ohio Taxation: separate municipal net-profit tax regime" } ] } }, "sources": [ { "id": "OH-purpose", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.03", "section": "\u00a71701.03(A)(5)", "claims": [ "Express beneficial purpose and exchange-listed conversion restriction" ] }, { "id": "OH-director", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.59", "section": "\u00a71701.59(D)\u2013(G)", "claims": [ "Mandatory shareholder/benefit factors, permissive stakeholders, automatic director monetary rule, exceptions" ] }, { "id": "OH-enforcement", "url": "https://codes.ohio.gov/ohio-revised-code/section-1701.96", "section": "\u00a71701.96(A)\u2013(D)", "claims": [ "Company purpose-damages bar, 25%/$2m standing, preservation of other-law/contract remedies" ] }, { "id": "OH-vote", "url": "https://codes.ohio.gov/assets/laws/revised-code/authenticated/17/1701/1701.71/7-10-2014/1701.71-7-10-2014.pdf", "section": "\u00a71701.71(A)(1)(a),(B)", "claims": [ "Default two-thirds voting power, charter variable not below majority, applicable class votes" ] }, { "id": "OH-reports", "url": "https://www.ohiosos.gov/public-integrity/protect-your-business/important-warnings", "section": "Annual-report solicitation warning", "claims": [ "Ordinary corporation annual report not required; LLP/professional exceptions" ] }, { "id": "OH-tax-franchise", "url": "https://tax.ohio.gov/business/corporation-franchise-tax", "section": "Corporation franchise tax ended after 2013", "claims": [ "Franchise tax no longer applies for 2014 onward." ] }, { "id": "OH-tax-CAT", "url": "https://tax.ohio.gov/business/commercial-activity-tax/commercial-activity-tax", "section": "2025-forward exclusion, annual-minimum repeal and rates", "claims": [ "CAT annual minimum eliminated from 2024; $6 million exclusion from 2025; 0.26% rate; Ohio nexus/group and quarterly-filing rules." ] }, { "label": "Ohio Taxation: Corporation Franchise Tax ended after 2013", "url": "https://tax.ohio.gov/business/corporation-franchise-tax", "checked": "2026-10-11", "section": "Ohio Taxation: Corporation Franchise Tax ended after 2013" }, { "label": "Ohio Taxation: CAT rate, 2025-forward exclusion, annual-minimum repeal, nexus, and group rules", "url": "https://tax.ohio.gov/business/commercial-activity-tax/commercial-activity-tax", "checked": "2026-10-11", "section": "Ohio Taxation: CAT rate, 2025-forward exclusion, annual-minimum repeal, nexus, and group rules" }, { "label": "Ohio Taxation: separate municipal net-profit tax regime", "url": "https://tax.ohio.gov/business/municipal-net-profit-tax", "checked": "2026-10-11", "section": "Ohio Taxation: separate municipal net-profit tax regime" } ], "differences": [ "25% voting-share derivative threshold differs sharply from 2% model thresholds.", "No default annual public benefit report or third-party assessment.", "Director liability default uses clear-and-convincing deliberate injury/reckless disregard, with express opt-out.", "Other-law/contract remedies are expressly preserved.", "A later conversion can be restricted for an initially purpose-free exchange-listed corporation." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "Benefit amendments \u00a7\u00a71701.59/1701.96 effective March 24, 2021; \u00a71701.03 current effective October 3, 2023." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Ohio offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Ohio has an identified director monetary-protection provision in the compared scope, which earns this credit. A statutory default director protection, rather than merely an optional charter clause; ordinary exceptions and capacity limits remain.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Ohio does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 3, 3 ], "reason": "Statutory coverage in the selected scope receives the 3-point default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Ohio has a default statutory liability rule in the compared scope, so it earns the automatic-coverage credit. Articles and retained exceptions still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Ohio earns the benefit-specific credit for company. \u00a71701.96(D) expressly preserves other legal and contractual duties/remedies. This is no defense to campaign-finance penalties or non-purpose claims.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Ohio has no separately credited benefit-specific monetary shield for directors. \u00a71701.96(D) expressly preserves other legal and contractual duties/remedies. This is no defense to campaign-finance penalties or non-purpose claims.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Ohio has no separately credited benefit-specific monetary shield for officers. \u00a71701.96(D) expressly preserves other legal and contractual duties/remedies. This is no defense to campaign-finance penalties or non-purpose claims.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 25, 25 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 10, 10 ], "reason": "No mandated benefit report receives 10 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Ohio: No mandated benefit report. This gets more ease-of-operation credit than an annual mandate because reporting is less frequent or not mandatory.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Ohio: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Ohio: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Ohio has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $0 = $0 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Ohio has a compared recurring floor of $0 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation with Ohio taxable gross receipts, including any required CAT group, at or below $6 million: $0 CAT and no former franchise/annual-minimum charge. This excludes local income taxes, report fees, and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "No model-act automatic every-class two-thirds status vote. Public-exchange timing can block a later benefit-purpose amendment.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Ohio: becoming a benefit company requires Ordinary articles amendment: default two thirds voting power, charter can vary but not below majority; applicable class votes still required. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Ohio: changing back requires Ordinary articles amendment rule. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 3, 3 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No statutory public benefit-report access mandate: 0 points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Ohio has no mandatory public access in the compared variant, so it gets no public-access credit. Voluntary publication is still possible. No default annual benefit report, public report or third-party-standard assessment under the benefit provisions.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No mandated benefit report: 0 points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Ohio: No mandated benefit report. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Ohio: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Ohio makes a mission duty mandatory, so it earns this credit. Directors shall consider shareholders, stated beneficial purposes and any charter priority/balancing method. Other stakeholder groups may be considered.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 0, "ordinaryScope": { "director": true, "officer": false, "automatic": true }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 0, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "No mandated benefit report", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 74, 74 ], "tax": { "code": "OH", "incomeSummary": "Ohio no longer imposes the former state Corporation Franchise Tax: 2013 was the final report year. An ordinary corporation instead may face the Commercial Activity Tax on Ohio taxable gross receipts. Municipal net-profit income taxes are separate and can apply even when state CAT is zero.", "recurringSummary": "For 2025 and later, ordinary businesses with Ohio taxable gross receipts of $6 million or less are excluded from CAT. Above the $6 million annual exclusion, CAT is 0.26% of taxable gross receipts. The CAT annual minimum tax ended in 2024; there is no surviving ordinary state flat franchise/CAT minimum. Group aggregation can change eligibility.", "formationAnnualTaxFloor": null, "floorBasis": "No positive ordinary state charter-only tax floor after the corporation franchise tax and CAT annual minimum ended. CAT depends on receipts/nexus; municipal and other operating taxes and registry fees are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation with Ohio taxable gross receipts, including any required CAT group, at or below $6 million: $0 CAT and no former franchise/annual-minimum charge. This excludes local income taxes, report fees, and other operating taxes.", "operatingTaxCaution": "CAT measures receipts, so an income loss does not establish exemption. Ohio domicile or statutory bright-line presence can create nexus, while receipt sourcing and group aggregation determine the base/exclusion. Sales, employment, municipal net-profit, and other taxes require separate analysis. Active CAT accounts can have filing duties even below the exclusion.", "sources": [ { "label": "Ohio Taxation: Corporation Franchise Tax ended after 2013", "url": "https://tax.ohio.gov/business/corporation-franchise-tax", "checked": "2026-10-11", "section": "Ohio Taxation: Corporation Franchise Tax ended after 2013" }, { "label": "Ohio Taxation: CAT rate, 2025-forward exclusion, annual-minimum repeal, nexus, and group rules", "url": "https://tax.ohio.gov/business/commercial-activity-tax/commercial-activity-tax", "checked": "2026-10-11", "section": "Ohio Taxation: CAT rate, 2025-forward exclusion, annual-minimum repeal, nexus, and group rules" }, { "label": "Ohio Taxation: separate municipal net-profit tax regime", "url": "https://tax.ohio.gov/business/municipal-net-profit-tax", "checked": "2026-10-11", "section": "Ohio Taxation: separate municipal net-profit tax regime" } ] }, "conversion": { "state": "Ohio", "code": "OH", "form": "Benefit corporation", "status": "Available", "group": "ordinary", "groupLabel": "Ordinary / qualified-majority route", "entryVote": "Ordinary articles amendment: default two thirds voting power, charter can vary but not below majority; applicable class votes still required.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "No model-act automatic every-class two-thirds status vote. Public-exchange timing can block a later benefit-purpose amendment.", "proposal": "Keep the ordinary-amendment route; address the exchange-listing timing restriction separately and preserve applicable class votes.", "sources": [ { "id": "OH-vote", "url": "https://codes.ohio.gov/assets/laws/revised-code/authenticated/17/1701/1701.71/7-10-2014/1701.71-7-10-2014.pdf", "section": "\u00a71701.71(A)(1)(a),(B)", "claims": [ "Default two-thirds voting power, charter variable not below majority, applicable class votes" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Articles must expressly state one or more beneficial purposes; any ordinary lawful-profit purpose alone does not qualify. No whole-society/environment general-benefit mandate.", "difference": "Ohio offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "A statutory default director protection, rather than merely an optional charter clause; ordinary exceptions and capacity limits remain. Benefit-specific rule: \u00a71701.96(D) expressly preserves other legal and contractual duties/remedies. This is no defense to campaign-finance penalties or non-purpose claims.", "difference": "Ohio keeps this ordinary shield limited to directors and a default statutory liability rule. Director liability default uses clear-and-convincing deliberate injury/reckless disregard, with express opt-out." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No default annual benefit report, public report or third-party-standard assessment under the benefit provisions. Assessment rule: No annual independent-standard assessment or certification mandate in the benefit provisions.", "difference": "Ohio: No mandated benefit report; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $0 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation with Ohio taxable gross receipts, including any required CAT group, at or below $6 million: $0 CAT and no former franchise/annual-minimum charge. This excludes local income taxes, report fees, and other operating taxes.", "difference": "Ohio has a compared recurring floor of $0 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Ordinary articles amendment: default two thirds voting power, charter can vary but not below majority; applicable class votes still required. No model-act automatic every-class two-thirds status vote. Public-exchange timing can block a later benefit-purpose amendment. Changing back: Ordinary articles amendment rule.", "difference": "Ohio entry uses Ordinary articles amendment: default two thirds voting power, charter can vary but not below majority; applicable class votes still required.; exit uses Ordinary articles amendment rule.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors shall consider shareholders, stated beneficial purposes and any charter priority/balancing method. Other stakeholder groups may be considered. Disclosure: No default annual benefit report, public report or third-party-standard assessment under the benefit provisions. Enforcement: Corporation may sue directly. Default derivative benefit-purpose standing is much narrower than 2% or any-shareholder states.", "difference": "Ohio does not require public access in this compared variant. 25% voting-share derivative threshold differs sharply from 2% model thresholds. No default annual public benefit report or third-party assessment." } } }, "guideUrl": "/assets/state-guides/OH.md" }, { "state": "Oklahoma", "abbreviation": "OK", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "general-benefit duties with optional public/independent annual reporting", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a charter may add specific public benefits.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] } ] }, "board": { "model": "mandatory_stakeholder_consideration", "summary": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "thirdPartyStandard": "definition_required_report_optional", "certificationRequired": false, "summary": "General-benefit definition refers to assessment against a third-party standard, but \u00a71210 makes using a third-party standard for the annual statement optional. Audit/certification is not required.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] } ], "thirdPartyRequired": null }, "report": { "cadence": "annual", "shareholders": true, "public": false, "stateFiling": false, "deadline": "Earlier of 120 days after fiscal year end or another annual shareholder report.", "redactions": "Public release is optional; no mandatory public version to redact.", "summary": "Annual shareholder statement of objectives, standards and benefit success; public release, independent-standard reporting and periodic certification are optional under \u00a71210.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] } ] }, "enforcement": { "threshold": "2% of a class/series at act/omission; director; 5% parent equity owner; authorized others.", "summary": "Corporation direct and specified derivative standing; ordinary derivative conditions remain.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to create general/specific benefit.", "directors": "Default bar, unless certificate/bylaws provide otherwise: disinterested benefit-duty actions/inactions and failure to create benefit. Informed disinterested good-faith rational decision satisfies duty.", "officers": "Parallel disinterested benefit-duty and benefit-failure shield, unless certificate/bylaws otherwise.", "summary": "Benefit shields distinguish disinterested compliant-duty conduct from benefit-outcome failure. Ordinary director/officer charter exculpation is governed by the consolidated 2026 \u00a71006 text and its narrower officer scope.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] } ] }, "ordinaryExculpation": { "scope": "directors and officers; officer corporate/derivative claims excluded", "activation": "Opt-in certificate of incorporation under \u00a718-1006(B)(7).", "exceptions": [ "Loyalty breach", "Bad faith, intentional misconduct or knowing law violation", "Improper personal benefit", "Director unlawful distributions under \u00a71053", "Any officer action brought by or in the right of the corporation", "Acts before the certificate provision takes effect" ], "summary": "2026 ch.217 (SB 2184) \u00a726 reenacted the director-and-officer clause and \u00a727 expressly repealed the competing director-only 2024 version. The shield requires a certificate provision. Officers remain exposed to corporate/derivative claims, and the misconduct/loyalty exceptions remain.", "sources": [ { "id": "OK-ordinary-2026", "url": "https://www.oklegislature.gov/cf_pdf/2025-26%20ENR/SB/SB2184%20ENR.PDF", "section": "2026 ch.217 (SB 2184) \u00a7\u00a726\u201327,161; \u00a718-1006(B)(7); pp48\u201356,451", "claims": [ "Director/officer charter scope, exceptions and officer corporate/derivative exclusion; duplicate version expressly repealed; immediate emergency effect" ] } ] }, "statusChange": { "entryVote": "Two thirds of every class/series, including otherwise nonvoting shares.", "exitVote": "Same minimum status vote.", "lock": "No unconditional permanent lock; specific-purpose amendments also need minimum status vote.", "summary": "Model-style two-thirds each-class status/purpose protection.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] } ] } }, "costs": { "regularReport": { "amount": 0, "cadence": "none", "conditions": "No routine SOS annual-report/certificate duty for an ordinary domestic stock corporation. \u00a718-1142(A)(5),(17) corporate annual-certificate fees concern foreign corporations; \u00a72055.2 LLC certificates are different entities.", "summary": "No routine SOS annual-report/certificate duty for an ordinary domestic stock corporation. \u00a718-1142(A)(5),(17) corporate annual-certificate fees concern foreign corporations; \u00a72055.2 LLC certificates are different entities.", "sources": [ { "id": "OK-fees", "url": "https://www.sos.ok.gov/business/forms.aspx", "section": "Current corporation/SBC and LLC filing schedules", "claims": [ "Corporation forms do not list ordinary annual certificate fee; LLC renewal is a different form" ] }, { "id": "OK-fee-statutory", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "\u00a718-1142(A)(5),(17),(18), pp515\u2013517", "claims": [ "Corporate annual certificate applies to foreign corporations and ceases after fees paid on full authorized capital; distinct $100 SOS-agent charge. No routine domestic-stock annual certificate." ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No state benefit-report filing in \u00a7\u00a71201\u20131210.", "summary": "No state benefit-report filing in \u00a7\u00a71201\u20131210.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] }, { "id": "OK-fees", "url": "https://www.sos.ok.gov/business/forms.aspx", "section": "Current corporation/SBC and LLC filing schedules", "claims": [ "Corporation forms do not list ordinary annual certificate fee; LLC renewal is a different form" ] } ] }, "minimumTax": { "amount": 0, "cadence": "annual", "conditions": "Oklahoma franchise tax eliminated for tax year 2024 onward; ordinary income taxes remain.", "summary": "Oklahoma franchise tax eliminated for tax year 2024 onward; ordinary income taxes remain.", "sources": [ { "id": "OK-tax", "url": "https://oklahoma.gov/tax/newsroom/2023/07-26-23.html", "section": "Tax Commission franchise-tax elimination announcement", "claims": [ "Franchise tax eliminated starting tax year 2024" ] }, { "label": "Oklahoma Tax Commission: corporate income tax rate and Oklahoma-source filing scope", "url": "https://oklahoma.gov/tax/businesses/other-taxes.html", "checked": "2026-10-11", "section": "Oklahoma Tax Commission: corporate income tax rate and Oklahoma-source filing scope" }, { "label": "Oklahoma Tax Commission: franchise-tax elimination and final 2023 returns", "url": "https://oklahoma.gov/tax/newsroom/2023/07-26-23.html", "checked": "2026-10-11", "section": "Oklahoma Tax Commission: franchise-tax elimination and final 2023 returns" } ] } }, "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] }, { "id": "OK-fees", "url": "https://www.sos.ok.gov/business/forms.aspx", "section": "Current corporation/SBC and LLC filing schedules", "claims": [ "Corporation forms do not list ordinary annual certificate fee; LLC renewal is a different form" ] }, { "id": "OK-tax", "url": "https://oklahoma.gov/tax/newsroom/2023/07-26-23.html", "section": "Tax Commission franchise-tax elimination announcement", "claims": [ "Franchise tax eliminated starting tax year 2024" ] }, { "id": "OK-ordinary-2026", "url": "https://www.oklegislature.gov/cf_pdf/2025-26%20ENR/SB/SB2184%20ENR.PDF", "section": "2026 ch.217 (SB 2184) \u00a7\u00a726\u201327,161; \u00a718-1006(B)(7); pp48\u201356,451", "claims": [ "Director/officer charter scope, exceptions and officer corporate/derivative exclusion; duplicate version expressly repealed; immediate emergency effect" ] }, { "id": "OK-ordinary-2026-status", "url": "https://www.oklegislature.gov/BillInfo.aspx?Bill=sb2184&Session=2600", "section": "Governor approval May 6, 2026 and emergency votes", "claims": [ "Current enacted-law approval and emergency passage verified" ] }, { "id": "OK-fee-statutory", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "\u00a718-1142(A)(5),(17),(18), pp515\u2013517", "claims": [ "Corporate annual certificate applies to foreign corporations and ceases after fees paid on full authorized capital; distinct $100 SOS-agent charge. No routine domestic-stock annual certificate." ] }, { "id": "OK-business-guidance", "url": "https://oklahoma.gov/business/launch/register-your-business.html", "section": "State business-registration guide, recurring fees and franchise-tax note", "claims": [ "LLC/LP annual SOS fee distinguished from corporate franchise tax; franchise-tax elimination from 2024." ] }, { "label": "Oklahoma Tax Commission: corporate income tax rate and Oklahoma-source filing scope", "url": "https://oklahoma.gov/tax/businesses/other-taxes.html", "checked": "2026-10-11", "section": "Oklahoma Tax Commission: corporate income tax rate and Oklahoma-source filing scope" }, { "label": "Oklahoma Tax Commission: franchise-tax elimination and final 2023 returns", "url": "https://oklahoma.gov/tax/newsroom/2023/07-26-23.html", "checked": "2026-10-11", "section": "Oklahoma Tax Commission: franchise-tax elimination and final 2023 returns" } ], "differences": [ "Annual shareholder benefit statement is mandatory, but public release and independent-standard reporting are optional.", "Do not equate third-party language in the purpose definition with a mandatory annual outside report.", "Benefit act currently runs \u00a7\u00a71201\u20131210, not through \u00a71213.", "Current ordinary charter exculpation includes officers but excludes every officer claim brought by or in the right of the corporation; 2026 legislation resolved the earlier duplicate-text conflict." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "2026 ch.217 (SB 2184), approved May 6, 2026, \u00a726 consolidates officer-inclusive \u00a71006 and \u00a727 repeals 2024 ch.121 director-only duplicate. Emergency \u00a7161 makes the law effective on passage and approval. The November 2025 title PDF therefore must not be used alone for current officer scope." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Oklahoma offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 22, 22 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Oklahoma has an identified director monetary-protection provision in the compared scope, which earns this credit. 2026 ch.217 (SB 2184) \u00a726 reenacted the director-and-officer clause and \u00a727 expressly repealed the competing director-only 2024 version. The shield requires a certificate provision. Officers remain exposed to corporate/derivative claims, and the misconduct/loyalty exceptions remain.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Oklahoma extends ordinary protection to officers, which earns officer-scope credit. 2026 ch.217 (SB 2184) \u00a726 reenacted the director-and-officer clause and \u00a727 expressly repealed the competing director-only 2024 version. The shield requires a certificate provision. Officers remain exposed to corporate/derivative claims, and the misconduct/loyalty exceptions remain.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Oklahoma requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Oklahoma earns the benefit-specific credit for company. Benefit shields distinguish disinterested compliant-duty conduct from benefit-outcome failure. Ordinary director/officer charter exculpation is governed by the consolidated 2026 \u00a71006 text and its narrower officer scope.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Oklahoma earns the benefit-specific credit for directors. Benefit shields distinguish disinterested compliant-duty conduct from benefit-outcome failure. Ordinary director/officer charter exculpation is governed by the consolidated 2026 \u00a71006 text and its narrower officer scope.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Oklahoma earns the benefit-specific credit for officers. Benefit shields distinguish disinterested compliant-duty conduct from benefit-outcome failure. Ordinary director/officer charter exculpation is governed by the consolidated 2026 \u00a71006 text and its narrower officer scope.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Oklahoma: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Oklahoma: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit. General-benefit definition refers to assessment against a third-party standard, but \u00a71210 makes using a third-party standard for the annual statement optional. Audit/certification is not required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Oklahoma: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Oklahoma has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $0 = $0 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Oklahoma has a compared recurring floor of $0 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic stock C corporation operating in Oklahoma with no Oklahoma taxable income after state adjustments: $0 ordinary corporate tax and no former franchise minimum. Excludes report/permit fees and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Model-style two-thirds each-class status/purpose protection.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Oklahoma: becoming a benefit company requires Two thirds of every class/series, including otherwise nonvoting shares. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Oklahoma: changing back requires Same minimum status vote. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 9, 9 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No statutory public benefit-report access mandate: 0 points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Oklahoma has no mandatory public access in the compared variant, so it gets no public-access credit. Voluntary publication is still possible. Annual shareholder statement of objectives, standards and benefit success; public release, independent-standard reporting and periodic certification are optional under \u00a71210.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Oklahoma: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Oklahoma: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit. General-benefit definition refers to assessment against a third-party standard, but \u00a71210 makes using a third-party standard for the annual statement optional. Audit/certification is not required.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Oklahoma makes a mission duty mandatory, so it earns this credit. Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 0, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 0, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 84, 84 ], "tax": { "code": "OK", "incomeSummary": "Oklahoma ordinary corporate income tax is a flat 4% of Oklahoma taxable income. Oklahoma-source income creates a corporate return requirement; the tax is not a flat incorporation payment.", "recurringSummary": "Oklahoma's corporation franchise tax was eliminated starting tax year 2024; tax year 2023 was the final franchise-tax year. Ordinary corporate income tax remains. There is no surviving general fixed franchise/capital minimum for the selected ordinary corporation, and any registry/permit charges are separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive ordinary charter-only tax floor after franchise-tax elimination. Corporate income tax depends on Oklahoma taxable income. Registry/report charges and specialized industry or operating taxes are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic stock C corporation operating in Oklahoma with no Oklahoma taxable income after state adjustments: $0 ordinary corporate tax and no former franchise minimum. Excludes report/permit fees and other operating taxes.", "operatingTaxCaution": "Actual Oklahoma-source income, state modifications, apportionment, and consolidated-return choices determine income tax. A corporation formed elsewhere can still owe Oklahoma tax on its Oklahoma operations. Sales/use, payroll, property, and activity-specific taxes are separate from the franchise-tax repeal.", "sources": [ { "label": "Oklahoma Tax Commission: corporate income tax rate and Oklahoma-source filing scope", "url": "https://oklahoma.gov/tax/businesses/other-taxes.html", "checked": "2026-10-11", "section": "Oklahoma Tax Commission: corporate income tax rate and Oklahoma-source filing scope" }, { "label": "Oklahoma Tax Commission: franchise-tax elimination and final 2023 returns", "url": "https://oklahoma.gov/tax/newsroom/2023/07-26-23.html", "checked": "2026-10-11", "section": "Oklahoma Tax Commission: franchise-tax elimination and final 2023 returns" } ] }, "conversion": { "state": "Oklahoma", "code": "OK", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "Two thirds of every class/series, including otherwise nonvoting shares.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Model-style two-thirds each-class status/purpose protection.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "id": "OK-code", "url": "https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os18.pdf", "section": "Official November 2025 Title18, \u00a7\u00a71202,1204\u20131210 and \u00a71142(A)(5),(17); \u00a71006 superseded by 2026 ch.217", "claims": [ "Purpose, duties, standing, benefit shields and optional public/third-party statement; foreign-only corporate annual certificates. Ordinary \u00a71006 current text is supplied by the 2026 enacted-law source." ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a charter may add specific public benefits.", "difference": "Oklahoma offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "2026 ch.217 (SB 2184) \u00a726 reenacted the director-and-officer clause and \u00a727 expressly repealed the competing director-only 2024 version. The shield requires a certificate provision. Officers remain exposed to corporate/derivative claims, and the misconduct/loyalty exceptions remain. Benefit-specific rule: Benefit shields distinguish disinterested compliant-duty conduct from benefit-outcome failure. Ordinary director/officer charter exculpation is governed by the consolidated 2026 \u00a71006 text and its narrower officer scope.", "difference": "Oklahoma adds ordinary officer coverage; the charter must elect the ordinary protection. Current ordinary charter exculpation includes officers but excludes every officer claim brought by or in the right of the corporation; 2026 legislation resolved the earlier duplicate-text conflict." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder statement of objectives, standards and benefit success; public release, independent-standard reporting and periodic certification are optional under \u00a71210. Assessment rule: General-benefit definition refers to assessment against a third-party standard, but \u00a71210 makes using a third-party standard for the annual statement optional. Audit/certification is not required.", "difference": "Oklahoma: Annual; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $0 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic stock C corporation operating in Oklahoma with no Oklahoma taxable income after state adjustments: $0 ordinary corporate tax and no former franchise minimum. Excludes report/permit fees and other operating taxes.", "difference": "Oklahoma has a compared recurring floor of $0 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Two thirds of every class/series, including otherwise nonvoting shares. Model-style two-thirds each-class status/purpose protection. Changing back: Same minimum status vote.", "difference": "Oklahoma entry uses Two thirds of every class/series, including otherwise nonvoting shares.; exit uses Same minimum status vote.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities. Disclosure: Annual shareholder statement of objectives, standards and benefit success; public release, independent-standard reporting and periodic certification are optional under \u00a71210. Enforcement: Corporation direct and specified derivative standing; ordinary derivative conditions remain.", "difference": "Oklahoma does not require public access in this compared variant. Annual shareholder benefit statement is mandatory, but public release and independent-standard reporting are optional. Do not equate third-party language in the purpose definition with a mandatory annual outside report." } } }, "guideUrl": "/assets/state-guides/OK.md" }, { "state": "Oregon", "abbreviation": "OR", "form": "Benefit company: corporation or LLC", "status": "Available", "reviewed": "2026-10-11", "family": "general-benefit model with majority status vote and any-shareholder enforcement", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a charter may add specific public benefits.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ] }, "board": { "model": "mandatory_stakeholder_consideration", "summary": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "deadline": "Within 120 days after fiscal year end or with another annual shareholder report.", "redactions": "No express compensation/financial/proprietary public-redaction clause in \u00a760.768(4).", "summary": "Annual shareholder report and all public website reports or free copies. Independent-standard assessment at least annually; no certification/audit requirement.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ] }, "enforcement": { "threshold": "Any shareholder; governor/director; corporation; others authorized by governing documents. No automatic 5% parent-owner category.", "summary": "\u00a760.766 provides direct or derivative proceedings as appropriate, without a shareholder percentage floor.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to create benefit.", "directors": "No monetary damages for compliant benefit-duty actions/inactions or benefit failure.", "officers": "Parallel compliant-duty and benefit-failure shield.", "summary": "Optional benefit governor has special immunity except self-dealing, willful misconduct or knowing law violation; every benefit company must have a board of governors.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ] }, "ordinaryExculpation": { "scope": "directors", "activation": "Opt-in articles.", "exceptions": [ "Loyalty breach", "Bad faith, intentional misconduct, knowing law violation", "\u00a760.367 unlawful distributions", "Improper personal benefit", "Prior acts" ], "summary": "Ordinary \u00a760.047(2)(d) director charter exculpation retains express loyalty and bad-faith exclusions, unlike the narrower MBCA-style exception list.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ] }, "statusChange": { "entryVote": "Majority of entitled interests for ordinary new private company, subject to greater governing-document/ordinary-law or separate-class requirements.", "exitVote": "Same \u00a760.756 voting structure.", "lock": "Special rule for shares already publicly traded January 1, 2014: every class two-thirds, or every class majority if gross revenue \u2264$200m.", "summary": "Oregon\u2019s ordinary private-company mission/status vote is majority, not automatic two-thirds every class. Legacy listed-company rule is different.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ] } }, "costs": { "regularReport": { "amount": 100, "cadence": "annual", "conditions": "Domestic business corporation annual renewal; foreign corporation rate is different.", "summary": "Domestic business corporation annual renewal; foreign corporation rate is different.", "sources": [ { "id": "OR-fees", "url": "https://sos.oregon.gov/business/Documents/business-registry-forms/br-fee-schedule.pdf", "section": "Business corporation annual report row", "claims": [ "$100 domestic annual renewal" ] } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate state benefit-report filing identified.", "summary": "No separate state benefit-report filing identified.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] }, { "id": "OR-fees", "url": "https://sos.oregon.gov/business/Documents/business-registry-forms/br-fee-schedule.pdf", "section": "Business corporation annual report row", "claims": [ "$100 domestic annual renewal" ] } ] }, "minimumTax": { "amount": 150, "cadence": "annual", "conditions": "C corporations doing business in Oregon generally file excise tax and pay the greater of calculated tax or sales-based minimum: $150 if Oregon sales are below $500,000, increasing by bracket to $100,000 at $100 million sales. Corporation income-tax filers with Oregon-source income but no Oregon business are not subject to the excise minimum; mere SOS registration creates no tax-filing requirement.", "summary": "C corporations doing business in Oregon generally file excise tax and pay the greater of calculated tax or sales-based minimum: $150 if Oregon sales are below $500,000, increasing by bracket to $100,000 at $100 million sales. Corporation income-tax filers with Oregon-source income but no Oregon business are not subject to the excise minimum; mere SOS registration creates no tax-filing requirement.", "sources": [ { "id": "OR-tax-applicability", "url": "https://www.oregon.gov/dor/programs/businesses/Pages/corp-requirements.aspx", "section": "Filing requirements; C-corporation minimum tax and rates", "claims": [ "Business activity triggers excise tax/minimum; income-only filers pay calculated tax without excise minimum; SOS registration alone does not create filing requirement." ] }, { "id": "OR-tax-minimum", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors317.html", "section": "ORS317.090(2); 2025 official compilation", "claims": [ "$150 minimum below $500,000 Oregon sales, graduated minimum up to $100,000 for C corporations." ] }, { "label": "Oregon DOR, corporation excise/income tax: rates, registration and inactive-corporation rules", "url": "https://www.oregon.gov/dor/programs/businesses/Pages/corp-requirements.aspx", "checked": "2026-10-11", "section": "Oregon DOR, corporation excise/income tax: rates, registration and inactive-corporation rules" }, { "label": "Oregon Legislature, ORS 317.090: $150-$100,000 sales-tier minimum", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors317.html", "checked": "2026-10-11", "section": "Oregon Legislature, ORS 317.090: $150-$100,000 sales-tier minimum" }, { "label": "Oregon DOR, Corporate Activity Tax: additional tax and thresholds", "url": "https://www.oregon.gov/dor/programs/businesses/Pages/corporate-activity-tax.aspx", "checked": "2026-10-11", "section": "Oregon DOR, Corporate Activity Tax: additional tax and thresholds" }, { "label": "Oregon SOS, benefit company FAQ: designation does not affect tax status", "url": "https://sos.oregon.gov/business/register/pages/benefit-company-faq.aspx", "checked": "2026-10-11", "section": "Oregon SOS, benefit company FAQ: designation does not affect tax status" } ] } }, "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] }, { "id": "OR-fees", "url": "https://sos.oregon.gov/business/Documents/business-registry-forms/br-fee-schedule.pdf", "section": "Business corporation annual report row", "claims": [ "$100 domestic annual renewal" ] }, { "id": "OR-report-cadence", "url": "https://sos.oregon.gov/business/Pages/faq.aspx", "section": "Annual report FAQs", "claims": [ "Anniversary annual renewal" ] }, { "id": "OR-tax-applicability", "url": "https://www.oregon.gov/dor/programs/businesses/Pages/corp-requirements.aspx", "section": "Filing requirements; C-corporation minimum tax and rates", "claims": [ "Business activity triggers excise tax/minimum; income-only filers pay calculated tax without excise minimum; SOS registration alone does not create filing requirement." ] }, { "id": "OR-tax-minimum", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors317.html", "section": "ORS317.090(2); 2025 official compilation", "claims": [ "$150 minimum below $500,000 Oregon sales, graduated minimum up to $100,000 for C corporations." ] }, { "label": "Oregon DOR, corporation excise/income tax: rates, registration and inactive-corporation rules", "url": "https://www.oregon.gov/dor/programs/businesses/Pages/corp-requirements.aspx", "checked": "2026-10-11", "section": "Oregon DOR, corporation excise/income tax: rates, registration and inactive-corporation rules" }, { "label": "Oregon Legislature, ORS 317.090: $150-$100,000 sales-tier minimum", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors317.html", "checked": "2026-10-11", "section": "Oregon Legislature, ORS 317.090: $150-$100,000 sales-tier minimum" }, { "label": "Oregon DOR, Corporate Activity Tax: additional tax and thresholds", "url": "https://www.oregon.gov/dor/programs/businesses/Pages/corporate-activity-tax.aspx", "checked": "2026-10-11", "section": "Oregon DOR, Corporate Activity Tax: additional tax and thresholds" }, { "label": "Oregon SOS, benefit company FAQ: designation does not affect tax status", "url": "https://sos.oregon.gov/business/register/pages/benefit-company-faq.aspx", "checked": "2026-10-11", "section": "Oregon SOS, benefit company FAQ: designation does not affect tax status" } ], "differences": [ "Ordinary new private-company benefit votes use majority rather than model two-thirds every class.", "Any shareholder has benefit enforcement standing; no automatic parent-owner standing.", "Public report statute contains no express financial/proprietary redaction allowance.", "Benefit company also permits LLCs; professional corporations can elect specific benefit instead of general benefit under \u00a760.758." ], "gaps": [], "confidence": { "level": "high", "unknowns": [] }, "sourceQualification": "", "effectiveNotes": [ "Voting provision amended 2015; current 2025 ORS reviewed." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit company: corporation or LLC. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Oregon offers Benefit company: corporation or LLC. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Oregon has an identified director monetary-protection provision in the compared scope, which earns this credit. Ordinary \u00a760.047(2)(d) director charter exculpation retains express loyalty and bad-faith exclusions, unlike the narrower MBCA-style exception list.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Oregon does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Oregon requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Oregon earns the benefit-specific credit for company. Optional benefit governor has special immunity except self-dealing, willful misconduct or knowing law violation; every benefit company must have a board of governors.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Oregon earns the benefit-specific credit for directors. Optional benefit governor has special immunity except self-dealing, willful misconduct or knowing law violation; every benefit company must have a board of governors.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Oregon earns the benefit-specific credit for officers. Optional benefit governor has special immunity except self-dealing, willful misconduct or knowing law violation; every benefit company must have a board of governors.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Oregon: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Oregon: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Oregon: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Oregon has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 6, 6 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 6, 6 ], "reason": "Ordinary reporting $100 + benefit filing $0 = $100 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Oregon has a compared recurring floor of $250 per year, including $150 in identified minimum tax/license charges. Ordinary domestic C corporation actually doing business in Oregon, excise filer, Oregon sales below $500,000, no taxable profit. Includes $150 minimum; CAT below its payment threshold, registry fees and variable taxes excluded. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 10, 10 ], "reason": "ORS 60.754 permits an existing corporation to elect by articles amendment. ORS 60.756 generally requires a majority of entitled interests, preserving higher document/statutory and separate-class approvals. For entities with traded shares as of January 1, 2014, the special rule is two-thirds per class, reduced to majority per class when gross revenue is $200 million or less.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Oregon: becoming a benefit company requires Generally a majority of interests entitled to vote; higher ordinary-law, governing-document and separate-class requirements remain. Legacy traded-company rules can require more. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 10, 10 ], "reason": "Ordinary majority/no added special gate: 10 points; read the actual denominator. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Oregon: changing back requires Same \u00a760.756 voting structure. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Oregon requires report access for people outside the company, so it earns public-access credit. Annual shareholder report and all public website reports or free copies. Independent-standard assessment at least annually; no certification/audit requirement.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Oregon: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Oregon: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Oregon makes a mission duty mandatory, so it earns this credit. Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 100, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "majority", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 250, "minimumTaxAnnualized": 150, "entryCategory": "ordinary" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Ordinary transaction votes" }, "scoreRange": [ 74, 74 ], "tax": { "code": "OR", "incomeSummary": "Corporate income/excise tax is 6.6% on the first $1 million of Oregon taxable income and 7.6% above it. Excise filers pay the greater of calculated tax or a sales-tier minimum. CAT is additional: $250 plus 0.57% above $1 million of taxable Oregon commercial activity, subject to exclusions and the permitted cost subtraction.", "recurringSummary": "For an ordinary C-corporation excise filer, minimum tax is $150 with Oregon sales below $500,000, rising to $100,000 at $100 million or more. Income-only filers do not owe this minimum. Registration alone does not create a tax return requirement. Benefit-company designation does not change tax status.", "formationAnnualTaxFloor": null, "floorBasis": "The $150 is the lowest operating excise-tax tier, not an incorporation-only obligation; an inactive registered corporation without Oregon business or source income need not file. Registry fees excluded.", "scenarioMinimum": 150, "scenarioBasis": "Ordinary domestic C corporation actually doing business in Oregon, excise filer, Oregon sales below $500,000, no taxable profit. Includes $150 minimum; CAT below its payment threshold, registry fees and variable taxes excluded.", "operatingTaxCaution": "Doing business determines excise status; Oregon-source income can trigger income tax instead. Multistate apportionment, Oregon sales and CAT activity are separate bases; registration is not a substitute for this analysis.", "sources": [ { "label": "Oregon DOR, corporation excise/income tax: rates, registration and inactive-corporation rules", "url": "https://www.oregon.gov/dor/programs/businesses/Pages/corp-requirements.aspx", "checked": "2026-10-11", "section": "Oregon DOR, corporation excise/income tax: rates, registration and inactive-corporation rules" }, { "label": "Oregon Legislature, ORS 317.090: $150-$100,000 sales-tier minimum", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors317.html", "checked": "2026-10-11", "section": "Oregon Legislature, ORS 317.090: $150-$100,000 sales-tier minimum" }, { "label": "Oregon DOR, Corporate Activity Tax: additional tax and thresholds", "url": "https://www.oregon.gov/dor/programs/businesses/Pages/corporate-activity-tax.aspx", "checked": "2026-10-11", "section": "Oregon DOR, Corporate Activity Tax: additional tax and thresholds" }, { "label": "Oregon SOS, benefit company FAQ: designation does not affect tax status", "url": "https://sos.oregon.gov/business/register/pages/benefit-company-faq.aspx", "checked": "2026-10-11", "section": "Oregon SOS, benefit company FAQ: designation does not affect tax status" } ] }, "conversion": { "state": "Oregon", "code": "OR", "form": "Benefit company: corporation or LLC", "status": "Available", "group": "ordinary", "groupLabel": "Ordinary / qualified-majority route", "entryVote": "Generally a majority of interests entitled to vote; higher ordinary-law, governing-document and separate-class requirements remain. Legacy traded-company rules can require more.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "ORS 60.754 permits an existing corporation to elect by articles amendment. ORS 60.756 generally requires a majority of entitled interests, preserving higher document/statutory and separate-class approvals. For entities with traded shares as of January 1, 2014, the special rule is two-thirds per class, reduced to majority per class when gross revenue is $200 million or less.", "proposal": "Preserve the qualified-majority route; review the legacy publicly traded-company exception separately. Ordinary law and governing documents can require more.", "sources": [ { "id": "OR-code", "url": "https://www.oregonlegislature.gov/bills_laws/ors/ors060.html", "section": "2025 ORS \u00a7\u00a760.750\u201360.770; \u00a760.047(2)(d)", "claims": [ "General/specific purposes, mandatory duties, benefits damages, any-shareholder enforcement, reports, majority/legacy-listed voting and ordinary exculpation" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a charter may add specific public benefits.", "difference": "Oregon offers Benefit company: corporation or LLC." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Ordinary \u00a760.047(2)(d) director charter exculpation retains express loyalty and bad-faith exclusions, unlike the narrower MBCA-style exception list. Benefit-specific rule: Optional benefit governor has special immunity except self-dealing, willful misconduct or knowing law violation; every benefit company must have a board of governors.", "difference": "Oregon keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. " }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder report and all public website reports or free copies. Independent-standard assessment at least annually; no certification/audit requirement. Assessment rule: Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "difference": "Oregon: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $100 per year on an annualized basis. Minimum tax/license used here: $150. Ordinary domestic C corporation actually doing business in Oregon, excise filer, Oregon sales below $500,000, no taxable profit. Includes $150 minimum; CAT below its payment threshold, registry fees and variable taxes excluded.", "difference": "Oregon has a compared recurring floor of $250 per year, including $150 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Generally a majority of interests entitled to vote; higher ordinary-law, governing-document and separate-class requirements remain. Legacy traded-company rules can require more. ORS 60.754 permits an existing corporation to elect by articles amendment. ORS 60.756 generally requires a majority of entitled interests, preserving higher document/statutory and separate-class approvals. For entities with traded shares as of January 1, 2014, the special rule is two-thirds per class, reduced to majority per class when gross revenue is $200 million or less. Changing back: Same \u00a760.756 voting structure.", "difference": "Oregon entry uses Generally a majority of interests entitled to vote; higher ordinary-law, governing-document and separate-class requirements remain. Legacy traded-company rules can require more.; exit uses Same \u00a760.756 voting structure.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities. Disclosure: Annual shareholder report and all public website reports or free copies. Independent-standard assessment at least annually; no certification/audit requirement. Enforcement: \u00a760.766 provides direct or derivative proceedings as appropriate, without a shareholder percentage floor.", "difference": "Oregon requires public access to the report. Any shareholder has benefit enforcement standing; no automatic parent-owner standing. Public report statute contains no express financial/proprietary redaction allowance." } } }, "guideUrl": "/assets/state-guides/OR.md" }, { "state": "Pennsylvania", "abbreviation": "PA", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / mandatory-stakeholder model", "features": { "purpose": { "summary": "General public benefit required; specific charter benefits optional.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "15 Pa.C.S. \u00a73311" } ] }, "board": { "summary": "Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required only for statutory registered corporations; optional otherwise.", "mode": "mandatory_consider", "benefitDirectorRequired": "statutory registered corporations only", "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a7\u00a73321-3322" } ] }, "standard": { "summary": "Third-party standard assessment required; assessment need not be audited or certified by a third party.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a73331(a)(2)" } ] }, "report": { "summary": "Annual to shareholders by earlier of 120 days or other annual report. All reports public online; latest free on request if no website. State benefit-report copy plus $70 fee.", "cadence": "annual", "shareholders": true, "publicWebsite": "all annual reports", "stateFiling": true, "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a73331(b)-(e)" } ], "public": true }, "enforcement": { "summary": "Corporation; a shareholder owning 2% of a class/series at challenged act (the statute does not expressly allow aggregation here), a director, a person/group owning 5% parent equity, and charter/bylaw designees.", "shareholderThreshold": "a shareholder owning 2% of class/series; aggregation not expressly stated", "directorStanding": true, "parentThreshold": "5% of parent equity", "otherStanding": "charter/bylaw designees", "corporationStanding": true, "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a73325(b)" } ] }, "benefitLiability": { "summary": "Corporation mission-failure damages barred. Directors/officers protected for benefit duties except self-dealing, wilful misconduct, knowing violations, and separately for mission failure. Benefit-director immunity instead excludes recklessness.", "corporationMissionDamagesBar": true, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a7\u00a73321(c),3322(f),3323(c),3325(a)(2)" } ] }, "ordinaryExculpation": { "summary": "Shareholder-adopted BYLAWS can exculpate both directors and officers for monetary damages, except duty failures involving self-dealing, wilful misconduct or recklessness. Criminal responsibility and tax liabilities excluded. Officer provision added in 2022.", "director": true, "officer": true, "automatic": false, "mechanism": "shareholder-adopted bylaws", "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.017..HTM", "section": "\u00a7\u00a71713,1735" } ] }, "statusChange": { "summary": "Two-thirds of each class/series, including nonvoting, for entry/exit and specified transactions.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds of each class, including nonvoting", "optionalLock": false, "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a7\u00a73302,3304-3305" } ] } }, "costs": { "regularReport": { "amount": 7, "currency": "USD", "cadence": "annual", "conditions": "For-profit corporation annual report began in 2025; due June 30.", "summary": "For-profit corporation annual report began in 2025; due June 30.", "sources": [ { "url": "https://www.pa.gov/agencies/dos/programs/business/types-of-filings-and-registrations/annual-reports", "section": "annual report fee and deadline" } ] }, "benefitReport": { "amount": 70, "currency": "USD", "cadence": "annual", "conditions": "Separate from ordinary $7 report.", "summary": "Separate from ordinary $7 report.", "sources": [ { "url": "https://www.pa.gov/agencies/dos/programs/business/fees-and-payments", "section": "Annual Report - Benefit corporation" } ] }, "minimumTax": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "The capital-stock/foreign-franchise tax was eliminated for tax years beginning January 1, 2016 and later. Ordinary C corporations subject to Pennsylvania corporate net income tax pay 7.49% for tax years beginning in 2026, calculated from modified federal taxable income and apportioned as applicable; zero Pennsylvania taxable income can produce $0 income tax, rather than a fixed franchise floor. Business activity, property or substantial nexus can trigger the tax even for an out-of-state corporation. PA S corporations generally avoid this corporate net income tax except for recognized built-in gains. The separate $7 annual corporate report and $70 benefit-report charge remain.", "basis": "Conditional $0 ordinary income-tax scenario; old capital-stock/franchise tax eliminated, current income tax remains.", "summary": "The capital-stock/foreign-franchise tax was eliminated for tax years beginning January 1, 2016 and later. Ordinary C corporations subject to Pennsylvania corporate net income tax pay 7.49% for tax years beginning in 2026, calculated from modified federal taxable income and apportioned as applicable; zero Pennsylvania taxable income can produce $0 income tax, rather than a fixed franchise floor. Business activity, property or substantial nexus can trigger the tax even for an out-of-state corporation. PA S corporations generally avoid this corporate net income tax except for recognized built-in gains. The separate $7 annual corporate report and $70 benefit-report charge remain.", "sources": [ { "url": "https://www.pa.gov/agencies/revenue/resources/tax-rates/corporation-tax-rates", "section": "2026 corporate net income rate; capital-stock/foreign-franchise tax eliminated since 2016" }, { "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/corporate-net-income-tax", "section": "Scope and federal-taxable-income base" }, { "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/capital-stock-and-foreign-franchise-taxes", "section": "Post-2015 elimination; PA S-corporation built-in-gain exception" }, { "label": "Pennsylvania DOR: corporate net income tax and 2026 rate schedule", "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/corporate-net-income-tax", "checked": "2026-10-11", "section": "Pennsylvania DOR: corporate net income tax and 2026 rate schedule" }, { "label": "Pennsylvania DOR: capital-stock/foreign-franchise tax elimination", "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/capital-stock-and-foreign-franchise-taxes", "checked": "2026-10-11", "section": "Pennsylvania DOR: capital-stock/foreign-franchise tax elimination" }, { "label": "Pennsylvania 2026\u20132027 budget: income-tax base and single-sales-factor rule", "url": "https://www.pa.gov/content/dam/copapwp-pagov/en/budget/documents/publications-and-reports/commonwealthbudget/2026-27-budget-documents/2026-27%20budget%20document.web.v.3.pdf", "checked": "2026-10-11", "section": "Pennsylvania 2026\u20132027 budget: income-tax base and single-sales-factor rule" } ] } }, "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "15 Pa.C.S. \u00a73311" }, { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a7\u00a73321-3322" }, { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a73331(a)(2)" }, { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a73331(b)-(e)" }, { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a73325(b)" }, { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a7\u00a73321(c),3322(f),3323(c),3325(a)(2)" }, { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.017..HTM", "section": "\u00a7\u00a71713,1735" }, { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a7\u00a73302,3304-3305" }, { "url": "https://www.pa.gov/agencies/dos/programs/business/types-of-filings-and-registrations/annual-reports", "section": "annual report fee and deadline" }, { "url": "https://www.pa.gov/agencies/dos/programs/business/fees-and-payments", "section": "Annual Report - Benefit corporation" }, { "url": "https://www.pa.gov/agencies/revenue/resources/tax-rates/corporation-tax-rates", "section": "2026 corporate net income rate; capital-stock/foreign-franchise tax eliminated since 2016" }, { "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/corporate-net-income-tax", "section": "Scope and federal-taxable-income base" }, { "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/capital-stock-and-foreign-franchise-taxes", "section": "Post-2015 elimination; PA S-corporation built-in-gain exception" }, { "label": "Pennsylvania DOR: corporate net income tax and 2026 rate schedule", "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/corporate-net-income-tax", "checked": "2026-10-11", "section": "Pennsylvania DOR: corporate net income tax and 2026 rate schedule" }, { "label": "Pennsylvania DOR: capital-stock/foreign-franchise tax elimination", "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/capital-stock-and-foreign-franchise-taxes", "checked": "2026-10-11", "section": "Pennsylvania DOR: capital-stock/foreign-franchise tax elimination" }, { "label": "Pennsylvania 2026\u20132027 budget: income-tax base and single-sales-factor rule", "url": "https://www.pa.gov/content/dam/copapwp-pagov/en/budget/documents/publications-and-reports/commonwealthbudget/2026-27-budget-documents/2026-27%20budget%20document.web.v.3.pdf", "checked": "2026-10-11", "section": "Pennsylvania 2026\u20132027 budget: income-tax base and single-sales-factor rule" } ], "differences": [ "Both director/officer ordinary protections available through shareholder-adopted bylaws.", "Benefit-director special immunity uses recklessness exception, ordinary benefit-duty clause uses knowing violation.", "$70 benefit report remains separate from new $7 annual corporate report.", "Unlike Maine/NH/RI, the 2% direct-company standing clause refers to a shareholder and does not expressly permit a group to aggregate." ], "gaps": [ "Statutory registered-corporation classification has fact-specific securities-law edge cases." ], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Pennsylvania offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 22, 22 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Pennsylvania has an identified director monetary-protection provision in the compared scope, which earns this credit. Shareholder-adopted BYLAWS can exculpate both directors and officers for monetary damages, except duty failures involving self-dealing, wilful misconduct or recklessness. Criminal responsibility and tax liabilities excluded. Officer provision added in 2022.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Pennsylvania extends ordinary protection to officers, which earns officer-scope credit. Shareholder-adopted BYLAWS can exculpate both directors and officers for monetary damages, except duty failures involving self-dealing, wilful misconduct or recklessness. Criminal responsibility and tax liabilities excluded. Officer provision added in 2022.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Pennsylvania requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Pennsylvania earns the benefit-specific credit for company. Corporation mission-failure damages barred. Directors/officers protected for benefit duties except self-dealing, wilful misconduct, knowing violations, and separately for mission failure. Benefit-director immunity instead excludes recklessness.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Pennsylvania earns the benefit-specific credit for directors. Corporation mission-failure damages barred. Directors/officers protected for benefit duties except self-dealing, wilful misconduct, knowing violations, and separately for mission failure. Benefit-director immunity instead excludes recklessness.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Pennsylvania earns the benefit-specific credit for officers. Corporation mission-failure damages barred. Directors/officers protected for benefit duties except self-dealing, wilful misconduct, knowing violations, and separately for mission failure. Benefit-director immunity instead excludes recklessness.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Pennsylvania: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Pennsylvania: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Pennsylvania: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Pennsylvania has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $7 + benefit filing $70 = $77 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Pennsylvania has a compared recurring floor of $77 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation in a regular 2026 tax year with no Pennsylvania taxable profit after state modifications and apportionment. Excludes annual corporate/benefit reporting and local or sector-specific taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Two-thirds of each class/series, including nonvoting, for entry/exit and specified transactions.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Pennsylvania: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Pennsylvania: changing back requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Pennsylvania requires report access for people outside the company, so it earns public-access credit. Annual to shareholders by earlier of 120 days or other annual report. All reports public online; latest free on request if no website. State benefit-report copy plus $70 fee.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Pennsylvania: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Pennsylvania: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Pennsylvania makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required only for statutory registered corporations; optional otherwise.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 77, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 77, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 79, 79 ], "tax": { "code": "PA", "incomeSummary": "Pennsylvania Corporate Net Income Tax is 7.49% for tax years beginning in 2026, on modified federal taxable income. The statutory schedule is 7.99% for 2025 and 6.99% for 2027; it is not a marginal bracket schedule.", "recurringSummary": "Capital-stock and foreign-franchise tax ended for tax years beginning in 2016 or later. The ordinary corporate-net-income formula has no fixed-dollar minimum. Annual corporate reporting and any required benefit report remain separate fees; sector-specific gross-receipts and insurance/bank taxes differ.", "formationAnnualTaxFloor": null, "floorBasis": "No surviving ordinary capital-stock/franchise floor is identified after the 2016 elimination. A $0 net-income result requires no Pennsylvania taxable income and does not eliminate registry reports, local business taxes or other operating taxes.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation in a regular 2026 tax year with no Pennsylvania taxable profit after state modifications and apportionment. Excludes annual corporate/benefit reporting and local or sector-specific taxes.", "operatingTaxCaution": "The revenue agency lists doing business, activities, property/capital use and substantial nexus as triggers for domestic and foreign corporations. Ordinary multistate income is generally apportioned by sales. Pennsylvania formation does not determine which state taxes the business's customers, employees or property.", "sources": [ { "label": "Pennsylvania DOR: corporate net income tax and 2026 rate schedule", "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/corporate-net-income-tax", "checked": "2026-10-11", "section": "Pennsylvania DOR: corporate net income tax and 2026 rate schedule" }, { "label": "Pennsylvania DOR: capital-stock/foreign-franchise tax elimination", "url": "https://www.pa.gov/agencies/revenue/resources/tax-types-and-information/corporation-taxes/capital-stock-and-foreign-franchise-taxes", "checked": "2026-10-11", "section": "Pennsylvania DOR: capital-stock/foreign-franchise tax elimination" }, { "label": "Pennsylvania 2026\u20132027 budget: income-tax base and single-sales-factor rule", "url": "https://www.pa.gov/content/dam/copapwp-pagov/en/budget/documents/publications-and-reports/commonwealthbudget/2026-27-budget-documents/2026-27%20budget%20document.web.v.3.pdf", "checked": "2026-10-11", "section": "Pennsylvania 2026\u20132027 budget: income-tax base and single-sales-factor rule" } ] }, "conversion": { "state": "Pennsylvania", "code": "PA", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Two-thirds of each class/series, including nonvoting, for entry/exit and specified transactions.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.legis.state.pa.us/WU01/LI/LI/CT/HTM/15/00.033..HTM", "section": "\u00a7\u00a73302,3304-3305" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required; specific charter benefits optional.", "difference": "Pennsylvania offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Shareholder-adopted BYLAWS can exculpate both directors and officers for monetary damages, except duty failures involving self-dealing, wilful misconduct or recklessness. Criminal responsibility and tax liabilities excluded. Officer provision added in 2022. Benefit-specific rule: Corporation mission-failure damages barred. Directors/officers protected for benefit duties except self-dealing, wilful misconduct, knowing violations, and separately for mission failure. Benefit-director immunity instead excludes recklessness.", "difference": "Pennsylvania adds ordinary officer coverage; the charter must elect the ordinary protection. Both director/officer ordinary protections available through shareholder-adopted bylaws. Benefit-director special immunity uses recklessness exception, ordinary benefit-duty clause uses knowing violation." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders by earlier of 120 days or other annual report. All reports public online; latest free on request if no website. State benefit-report copy plus $70 fee. Assessment rule: Third-party standard assessment required; assessment need not be audited or certified by a third party.", "difference": "Pennsylvania: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $77 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation in a regular 2026 tax year with no Pennsylvania taxable profit after state modifications and apportionment. Excludes annual corporate/benefit reporting and local or sector-specific taxes.", "difference": "Pennsylvania has a compared recurring floor of $77 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Two-thirds of each class/series, including nonvoting, for entry/exit and specified transactions. Changing back: two-thirds of each class, including nonvoting", "difference": "Pennsylvania entry uses two-thirds of each class, including nonvoting; exit uses two-thirds of each class, including nonvoting. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required only for statutory registered corporations; optional otherwise. Disclosure: Annual to shareholders by earlier of 120 days or other annual report. All reports public online; latest free on request if no website. State benefit-report copy plus $70 fee. Enforcement: Corporation; a shareholder owning 2% of a class/series at challenged act (the statute does not expressly allow aggregation here), a director, a person/group owning 5% parent equity, and charter/bylaw designees.", "difference": "Pennsylvania requires public access to the report. Both director/officer ordinary protections available through shareholder-adopted bylaws. $70 benefit report remains separate from new $7 annual corporate report. Unlike Maine/NH/RI, the 2% direct-company standing clause refers to a shareholder and does not expressly permit a group to aggregate." } } }, "guideUrl": "/assets/state-guides/PA.md" }, { "state": "Rhode Island", "abbreviation": "RI", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / mandatory-stakeholder model", "features": { "purpose": { "summary": "General benefit required; specific charter benefits optional.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-6.htm", "section": "\u00a77-5.3-6" } ] }, "board": { "summary": "Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required only if publicly traded, optional otherwise.", "mode": "mandatory_consider", "benefitDirectorRequired": "publicly traded only", "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-7.htm", "section": "\u00a7\u00a77-5.3-7,-8" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-8.htm", "section": "\u00a77-5.3-8" } ] }, "standard": { "summary": "Third-party assessment standard required; external audit/certification not required.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-12.htm", "section": "\u00a77-5.3-12(c)" } ] }, "report": { "summary": "Annual to shareholders within 120 days; first report year follows formation/qualification calendar year. All reports online; free latest on request if no website. State report combines corporate and benefit reporting with $60 combined fee.", "cadence": "annual", "shareholders": true, "publicWebsite": "all annual reports", "stateFiling": true, "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-13.htm", "section": "\u00a77-5.3-13" } ], "public": true }, "enforcement": { "summary": "Corporation; collective 2% of class/series at challenged act, director, 5% parent equity, charter/bylaw designees.", "shareholderThreshold": "2% of class/series", "directorStanding": true, "parentThreshold": "5% of parent equity", "otherStanding": "charter/bylaw designees", "corporationStanding": true, "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-11.htm", "section": "\u00a77-5.3-11(c)" } ] }, "benefitLiability": { "summary": "Corporation mission-failure damages barred. Directors/officers get compliant-duty and mission-failure monetary protection unless charter overrides.", "corporationMissionDamagesBar": true, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-11.htm", "section": "\u00a77-5.3-11(b)" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-7.htm", "section": "\u00a77-5.3-7(c)" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-9.htm", "section": "\u00a77-5.3-9(c)" } ] }, "ordinaryExculpation": { "summary": "Charter director damages exculpation excludes loyalty, bad faith, intentional misconduct/knowing violation, unlawful distributions and improper personal benefit (subject to approved-conflict exception). No officer clause.", "director": true, "officer": false, "automatic": false, "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-1.2/7-2/7-1.2-202.htm", "section": "\u00a77-1.2-202(b)(3)" } ] }, "statusChange": { "summary": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds of each class, including nonvoting", "optionalLock": false, "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-2.htm", "section": "\u00a7\u00a77-5.3-2,-4,-5" } ] } }, "costs": { "regularReport": { "amount": 60, "currency": "USD", "cadence": "annual", "conditions": "For benefit corporation, $60 is the combined corporate/benefit report fee; do not add a second $60.", "summary": "For benefit corporation, $60 is the combined corporate/benefit report fee; do not add a second $60.", "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-13.htm", "section": "\u00a77-5.3-13(d)" } ] }, "benefitReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "Included in $60 combined filing, not an additional fee.", "includedInRegular": true, "summary": "Included in $60 combined filing, not an additional fee.", "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-13.htm", "section": "\u00a77-5.3-13(d)" } ] }, "minimumTax": { "amount": 400, "currency": "USD", "cadence": "annual", "conditions": "Minimum corporate income tax for C/S corporations subject to RI tax; actual tax may exceed minimum.", "summary": "Minimum corporate income tax for C/S corporations subject to RI tax; actual tax may exceed minimum.", "sources": [ { "url": "https://tax.ri.gov/resources/businesses/corporate", "section": "Corporate Tax" }, { "label": "Rhode Island Division of Taxation: corporate rate and minimum", "url": "https://tax.ri.gov/resources/businesses/corporate", "checked": "2026-10-11", "section": "Rhode Island Division of Taxation: corporate rate and minimum" }, { "label": "Rhode Island Division of Taxation: corporate sourcing and combined reporting", "url": "https://tax.ri.gov/tax-sections/corporate-tax", "checked": "2026-10-11", "section": "Rhode Island Division of Taxation: corporate sourcing and combined reporting" }, { "label": "Rhode Island Secretary of State: registered for-profit minimum tax", "url": "https://www.sos.ri.gov/divisions/business-services/foreign-business/business-basics/costs-and-fees", "checked": "2026-10-11", "section": "Rhode Island Secretary of State: registered for-profit minimum tax" } ] } }, "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-6.htm", "section": "\u00a77-5.3-6" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-7.htm", "section": "\u00a7\u00a77-5.3-7,-8" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-8.htm", "section": "\u00a77-5.3-8" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-12.htm", "section": "\u00a77-5.3-12(c)" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-13.htm", "section": "\u00a77-5.3-13" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-11.htm", "section": "\u00a77-5.3-11(c)" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-11.htm", "section": "\u00a77-5.3-11(b)" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-7.htm", "section": "\u00a77-5.3-7(c)" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-9.htm", "section": "\u00a77-5.3-9(c)" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-1.2/7-2/7-1.2-202.htm", "section": "\u00a77-1.2-202(b)(3)" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-2.htm", "section": "\u00a7\u00a77-5.3-2,-4,-5" }, { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-13.htm", "section": "\u00a77-5.3-13(d)" }, { "url": "https://tax.ri.gov/resources/businesses/corporate", "section": "Corporate Tax" }, { "label": "Rhode Island Division of Taxation: corporate rate and minimum", "url": "https://tax.ri.gov/resources/businesses/corporate", "checked": "2026-10-11", "section": "Rhode Island Division of Taxation: corporate rate and minimum" }, { "label": "Rhode Island Division of Taxation: corporate sourcing and combined reporting", "url": "https://tax.ri.gov/tax-sections/corporate-tax", "checked": "2026-10-11", "section": "Rhode Island Division of Taxation: corporate sourcing and combined reporting" }, { "label": "Rhode Island Secretary of State: registered for-profit minimum tax", "url": "https://www.sos.ri.gov/divisions/business-services/foreign-business/business-basics/costs-and-fees", "checked": "2026-10-11", "section": "Rhode Island Secretary of State: registered for-profit minimum tax" } ], "differences": [ "Combined state-report fee prevents double counting ordinary plus benefit filing.", "Charter can override default benefit-duty damages protection.", "Private companies need no separate independent benefit director." ], "gaps": [ "Entity-specific tax nexus/exemptions not modeled." ], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Rhode Island offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Rhode Island has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter director damages exculpation excludes loyalty, bad faith, intentional misconduct/knowing violation, unlawful distributions and improper personal benefit (subject to approved-conflict exception). No officer clause.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Rhode Island does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Rhode Island requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Rhode Island earns the benefit-specific credit for company. Corporation mission-failure damages barred. Directors/officers get compliant-duty and mission-failure monetary protection unless charter overrides.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Rhode Island earns the benefit-specific credit for directors. Corporation mission-failure damages barred. Directors/officers get compliant-duty and mission-failure monetary protection unless charter overrides.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Rhode Island earns the benefit-specific credit for officers. Corporation mission-failure damages barred. Directors/officers get compliant-duty and mission-failure monetary protection unless charter overrides.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Rhode Island: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Rhode Island: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Rhode Island: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Rhode Island has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 3, 3 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 3, 3 ], "reason": "Ordinary reporting $60 + benefit filing $0 = $60 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Rhode Island has a compared recurring floor of $460 per year, including $400 in identified minimum tax/license charges. Small active ordinary domestic C corporation in a regular full year with no taxable profit and no special exemption. The separate annual registry report is additional. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Rhode Island: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Rhode Island: changing back requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Rhode Island requires report access for people outside the company, so it earns public-access credit. Annual to shareholders within 120 days; first report year follows formation/qualification calendar year. All reports online; free latest on request if no website. State report combines corporate and benefit reporting with $60 combined fee.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Rhode Island: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Rhode Island: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Rhode Island makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required only if publicly traded, optional otherwise.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 60, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 460, "minimumTaxAnnualized": 400, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 64, 64 ], "tax": { "code": "RI", "incomeSummary": "Rhode Island ordinary C-corporation tax is 7% of state-apportioned net income or $400, whichever is greater. Federal taxable income is modified for state rules; single-sales-factor market sourcing and combined reporting apply to C corporations.", "recurringSummary": "The corporate minimum is $400 annually. The Secretary of State says registered for-profit corporations, LLCs and limited partnerships must pay at least that minimum; S corporations and many pass-through entities also have minimum/annual-charge obligations under their own rules. Registry reports remain separate.", "formationAnnualTaxFloor": 400, "floorBasis": "Ordinary registered for-profit domestic corporation minimum, excluding the annual-report fee, special exempt/industry entities, income above the minimum, property, sales and payroll taxes. The comparison does not assume a nonprofit exemption from benefit-corporation status.", "scenarioMinimum": 400, "scenarioBasis": "Small active ordinary domestic C corporation in a regular full year with no taxable profit and no special exemption. The separate annual registry report is additional.", "operatingTaxCaution": "The tax agency applies single-sales-factor market sourcing to C corporations and uses combined reporting with the Finnegan method. Foreign corporations' Rhode Island activity can create tax obligations; state formation alone does not locate all business income in one jurisdiction.", "sources": [ { "label": "Rhode Island Division of Taxation: corporate rate and minimum", "url": "https://tax.ri.gov/resources/businesses/corporate", "checked": "2026-10-11", "section": "Rhode Island Division of Taxation: corporate rate and minimum" }, { "label": "Rhode Island Division of Taxation: corporate sourcing and combined reporting", "url": "https://tax.ri.gov/tax-sections/corporate-tax", "checked": "2026-10-11", "section": "Rhode Island Division of Taxation: corporate sourcing and combined reporting" }, { "label": "Rhode Island Secretary of State: registered for-profit minimum tax", "url": "https://www.sos.ri.gov/divisions/business-services/foreign-business/business-basics/costs-and-fees", "checked": "2026-10-11", "section": "Rhode Island Secretary of State: registered for-profit minimum tax" } ] }, "conversion": { "state": "Rhode Island", "code": "RI", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Two-thirds of every class/series including nonvoting for entry/exit and covered transactions.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://webserver.rilegislature.gov/Statutes/TITLE7/7-5.3/7-5.3-2.htm", "section": "\u00a7\u00a77-5.3-2,-4,-5" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General benefit required; specific charter benefits optional.", "difference": "Rhode Island offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter director damages exculpation excludes loyalty, bad faith, intentional misconduct/knowing violation, unlawful distributions and improper personal benefit (subject to approved-conflict exception). No officer clause. Benefit-specific rule: Corporation mission-failure damages barred. Directors/officers get compliant-duty and mission-failure monetary protection unless charter overrides.", "difference": "Rhode Island keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Charter can override default benefit-duty damages protection. Private companies need no separate independent benefit director." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders within 120 days; first report year follows formation/qualification calendar year. All reports online; free latest on request if no website. State report combines corporate and benefit reporting with $60 combined fee. Assessment rule: Third-party assessment standard required; external audit/certification not required.", "difference": "Rhode Island: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $60 per year on an annualized basis. Minimum tax/license used here: $400. Small active ordinary domestic C corporation in a regular full year with no taxable profit and no special exemption. The separate annual registry report is additional.", "difference": "Rhode Island has a compared recurring floor of $460 per year, including $400 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Two-thirds of every class/series including nonvoting for entry/exit and covered transactions. Changing back: two-thirds of each class, including nonvoting", "difference": "Rhode Island entry uses two-thirds of each class, including nonvoting; exit uses two-thirds of each class, including nonvoting. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required only if publicly traded, optional otherwise. Disclosure: Annual to shareholders within 120 days; first report year follows formation/qualification calendar year. All reports online; free latest on request if no website. State report combines corporate and benefit reporting with $60 combined fee. Enforcement: Corporation; collective 2% of class/series at challenged act, director, 5% parent equity, charter/bylaw designees.", "difference": "Rhode Island requires public access to the report. Combined state-report fee prevents double counting ordinary plus benefit filing." } } }, "guideUrl": "/assets/state-guides/RI.md" }, { "state": "South Carolina", "abbreviation": "SC", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / independent-benefit-director model", "features": { "purpose": { "summary": "General public benefit is required. A specific public benefit must be identified at formation under \u00a733-38-200, as confirmed by SOS formation form F0009 item 6 and its FY2025 statutory explanation. Section 33-38-300(B) nevertheless uses optional wording for specific purposes. Include a specific mission when forming; the inconsistent purpose-section wording remains a real drafting distinction.", "generalRequired": true, "specificRequired": true, "specificOptional": false, "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-200;\u00a733-38-300(A)-(B)" }, { "url": "https://businessfilings.sc.gov/BusinessFiling/Entity/DownloadForm?formName=F0009&entityType=7&filingType=Articles%20of%20Incorporation%20-%20Benefit%20Corporation", "section": "Current SOS download F0009 item 6: specific public benefit purposes" }, { "url": "https://sos.sc.gov/sites/sos/files/Documents/About%20Us/Secretary_of_State_FY%202025_Annual_AccountabilityReport.pdf", "section": "FY2025 statutory table, \u00a733-38-200: articles must identify specific public benefit" } ] }, "board": { "summary": "Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required for all, including private corporations.", "mode": "mandatory_consider", "benefitDirectorRequired": "all; boardless replacement", "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a7\u00a733-38-400,-410" } ] }, "standard": { "summary": "Third-party assessment standard required; performance assessment need not be performed, audited or certified by third party.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-500(A)(2)" } ] }, "report": { "summary": "Annual to shareholders by earlier of 120 days or another annual shareholder report; all benefit reports public online, free latest copy on request if no website. SOS form F0018 supplies the state-filing route: attach latest shareholder benefit report, submit two copies and $10 to SOS Corporate Filings. Ordinary annual Schedule D goes to DOR with the corporate tax return.", "cadence": "annual", "shareholders": true, "publicWebsite": "all annual reports", "stateFiling": true, "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-500(B)-(E)" }, { "url": "https://businessfilings.sc.gov/BusinessFiling/Entity/DownloadForm?formName=F0018&entityType=7&filingType=Annual%20Benefit%20Report%20-%20Benefit%20Corporation", "section": "F0018 current filing instructions" }, { "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "section": "Ordinary annual Schedule D within corporate return" } ], "public": true }, "enforcement": { "summary": "Corporation; any shareholder, director, 5% parent equity, charter/bylaw designees.", "shareholderThreshold": "any shareholder subject to derivative procedure", "directorStanding": true, "parentThreshold": "5% of parent equity", "otherStanding": "charter/bylaw designees", "corporationStanding": true, "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-440(C)" } ] }, "benefitLiability": { "summary": "Corporation mission-failure damages barred. Directors/officers protected for compliant-duty conduct and mission failure. Benefit-director immunity excludes improper personal benefit, wilful misconduct or knowing law violations.", "corporationMissionDamagesBar": true, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a7\u00a733-38-400(E),410(F),420(C),440(B)" } ] }, "ordinaryExculpation": { "summary": "Ordinary charter director exculpation restricted to SEC-registered voting-share companies, \u2265$25m assets, OR \u2265500 shareholders. Exceptions include loyalty, bad faith, GROSS NEGLIGENCE, intentional misconduct/knowing violation, unlawful distributions, improper personal benefit. Small private startups do not qualify; no officer clause.", "director": true, "officer": false, "automatic": false, "eligibilityRestricted": true, "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c002.php", "section": "\u00a733-2-102(e)" } ] }, "statusChange": { "summary": "Two-thirds of every class/series including nonvoting for entry/exit and specified asset transactions.", "entryVote": "two-thirds of each class, including nonvoting", "exitVote": "two-thirds of each class, including nonvoting", "optionalLock": false, "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-230" } ] } }, "costs": { "regularReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "Ordinary annual report is Schedule D inside the DOR SC1120/SC1120S corporate tax return; no separate ordinary SOS annual-report filing fee is added here. The DOR annual corporate license fee (minimum $25) is counted separately below. Dormant corporations still file the return and Schedule D.", "summary": "Ordinary annual report is Schedule D inside the DOR SC1120/SC1120S corporate tax return; no separate ordinary SOS annual-report filing fee is added here. The DOR annual corporate license fee (minimum $25) is counted separately below. Dormant corporations still file the return and Schedule D.", "sources": [ { "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "section": "Changes in information; Filing options/requirements: Schedule D and dormant returns" }, { "url": "https://www.scstatehouse.gov/code/t33c016.php", "section": "\u00a733-16-220: annual report as provided in Title 12" }, { "url": "https://www.scstatehouse.gov/code/t33c001.php", "section": "\u00a733-1-220(a)(23): ordinary annual-report fee paid to DOR" } ] }, "benefitReport": { "amount": 10, "currency": "USD", "cadence": "annual", "conditions": "Current SOS form F0018 requires the most recent benefit report delivered to shareholders, two copies of form and attachments, a self-addressed stamped return envelope, and a $10 check payable to Secretary of State. Mail to Corporate Filings, 1205 Pendleton Street, Suite 525, Columbia SC 29201. Separate from DOR Schedule D and corporate license fee.", "verification": "direct agency filing form currently served in SOS public forms index", "summary": "Current SOS form F0018 requires the most recent benefit report delivered to shareholders, two copies of form and attachments, a self-addressed stamped return envelope, and a $10 check payable to Secretary of State. Mail to Corporate Filings, 1205 Pendleton Street, Suite 525, Columbia SC 29201. Separate from DOR Schedule D and corporate license fee.", "sources": [ { "url": "https://businessfilings.sc.gov/BusinessFiling/Entity/DownloadForm?formName=F0018&entityType=7&filingType=Annual%20Benefit%20Report%20-%20Benefit%20Corporation", "section": "F0018 filing instructions 1, 2 and 4; mailing address" }, { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-500(E)" } ] }, "minimumTax": { "amount": 25, "currency": "USD", "cadence": "annual", "conditions": "Annual corporate license fee is $15 plus $1 per $1,000 of capital and paid-in surplus, with a $25 minimum; ordinary C/S corporations and dormant corporations remain subject. Paid with the DOR corporate return, separately from the $10 SOS benefit-report filing. Income tax, apportionment, initial-period and final-return rules can change actual liability.", "summary": "Annual corporate license fee is $15 plus $1 per $1,000 of capital and paid-in surplus, with a $25 minimum; ordinary C/S corporations and dormant corporations remain subject. Paid with the DOR corporate return, separately from the $10 SOS benefit-report filing. Income tax, apportionment, initial-period and final-return rules can change actual liability.", "sources": [ { "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "section": "annual license fee" }, { "label": "South Carolina DOR: C-corporation income rate and annual license formula", "url": "https://www.dor.sc.gov/business-income-taxes/corporate/c-corporation", "checked": "2026-10-11", "section": "South Carolina DOR: C-corporation income rate and annual license formula" }, { "label": "South Carolina DOR: initial, dormant, apportionment and final-return FAQ", "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "checked": "2026-10-11", "section": "South Carolina DOR: initial, dormant, apportionment and final-return FAQ" } ] } }, "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-200;\u00a733-38-300(A)-(B)" }, { "url": "https://businessfilings.sc.gov/BusinessFiling/Entity/DownloadForm?formName=F0009&entityType=7&filingType=Articles%20of%20Incorporation%20-%20Benefit%20Corporation", "section": "Current SOS download F0009 item 6: specific public benefit purposes" }, { "url": "https://sos.sc.gov/sites/sos/files/Documents/About%20Us/Secretary_of_State_FY%202025_Annual_AccountabilityReport.pdf", "section": "FY2025 statutory table, \u00a733-38-200: articles must identify specific public benefit" }, { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a7\u00a733-38-400,-410" }, { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-500(A)(2)" }, { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-500(B)-(E)" }, { "url": "https://businessfilings.sc.gov/BusinessFiling/Entity/DownloadForm?formName=F0018&entityType=7&filingType=Annual%20Benefit%20Report%20-%20Benefit%20Corporation", "section": "F0018 current filing instructions" }, { "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "section": "Ordinary annual Schedule D within corporate return" }, { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-440(C)" }, { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a7\u00a733-38-400(E),410(F),420(C),440(B)" }, { "url": "https://www.scstatehouse.gov/code/t33c002.php", "section": "\u00a733-2-102(e)" }, { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-230" }, { "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "section": "Changes in information; Filing options/requirements: Schedule D and dormant returns" }, { "url": "https://www.scstatehouse.gov/code/t33c016.php", "section": "\u00a733-16-220: annual report as provided in Title 12" }, { "url": "https://www.scstatehouse.gov/code/t33c001.php", "section": "\u00a733-1-220(a)(23): ordinary annual-report fee paid to DOR" }, { "url": "https://businessfilings.sc.gov/BusinessFiling/Entity/DownloadForm?formName=F0018&entityType=7&filingType=Annual%20Benefit%20Report%20-%20Benefit%20Corporation", "section": "F0018 filing instructions 1, 2 and 4; mailing address" }, { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-500(E)" }, { "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "section": "annual license fee" }, { "label": "South Carolina DOR: C-corporation income rate and annual license formula", "url": "https://www.dor.sc.gov/business-income-taxes/corporate/c-corporation", "checked": "2026-10-11", "section": "South Carolina DOR: C-corporation income rate and annual license formula" }, { "label": "South Carolina DOR: initial, dormant, apportionment and final-return FAQ", "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "checked": "2026-10-11", "section": "South Carolina DOR: initial, dormant, apportionment and final-return FAQ" } ], "differences": [ "A small private company lacks the ordinary charter exculpation available to larger/listed companies.", "Independent benefit director required; any qualifying shareholder can enforce.", "Formation requires a specific public mission in current SOS practice despite optional wording in the purpose section; annual benefit filing is $10 in addition to the DOR license minimum." ], "gaps": [ "Formation \u00a733-38-200 and SOS practice require a specific mission, while purpose \u00a733-38-300(B) uses optional language; this wording conflict should be preserved.", "Size thresholds materially qualify director-exculpation eligibility; it is unavailable to an ordinary small startup." ], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "South Carolina offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 10, 10 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 0, 0 ], "reason": "Selected small private company does not meet South Carolina eligibility.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "South Carolina\u2019s ordinary charter shield has public-company/size eligibility gates; this new small private company does not qualify, so this factor receives no credit. Ordinary charter director exculpation restricted to SEC-registered voting-share companies, \u2265$25m assets, OR \u2265500 shareholders. Exceptions include loyalty, bad faith, GROSS NEGLIGENCE, intentional misconduct/knowing violation, unlawful distributions, improper personal benefit. Small private startups do not qualify; no officer clause.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "South Carolina does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "South Carolina requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "South Carolina earns the benefit-specific credit for company. Corporation mission-failure damages barred. Directors/officers protected for compliant-duty conduct and mission failure. Benefit-director immunity excludes improper personal benefit, wilful misconduct or knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "South Carolina earns the benefit-specific credit for directors. Corporation mission-failure damages barred. Directors/officers protected for compliant-duty conduct and mission failure. Benefit-director immunity excludes improper personal benefit, wilful misconduct or knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "South Carolina earns the benefit-specific credit for officers. Corporation mission-failure damages barred. Directors/officers protected for compliant-duty conduct and mission failure. Benefit-director immunity excludes improper personal benefit, wilful misconduct or knowing law violations.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 8, 8 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "South Carolina: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "South Carolina: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "South Carolina: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "Mandatory benefit director or report-approval procedure in this private-company scope: no 3-point flexibility bonus.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "South Carolina requires an additional benefit-director or report-approval procedure in this private-company scope, so it receives no no-extra-step credit. Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required for all, including private corporations.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $10 = $10 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "South Carolina has a compared recurring floor of $35 per year, including $25 in identified minimum tax/license charges. Small active domestic C corporation in a regular full year after formation, no taxable profit and capital/paid-in-surplus license computation no greater than $25. Do not add the one-time initial CL-1 fee again; annual benefit-report fees are separate. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Two-thirds of every class/series including nonvoting for entry/exit and specified asset transactions.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "South Carolina: becoming a benefit company requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "South Carolina: changing back requires two-thirds of each class, including nonvoting. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "South Carolina requires report access for people outside the company, so it earns public-access credit. Annual to shareholders by earlier of 120 days or another annual shareholder report; all benefit reports public online, free latest copy on request if no website. SOS form F0018 supplies the state-filing route: attach latest shareholder benefit report, submit two copies and $10 to SOS Corporate Filings. Ordinary annual Schedule D goes to DOR with the corporate tax return.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "South Carolina: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "South Carolina: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "South Carolina makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required for all, including private corporations.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 10, "ordinaryScope": { "director": false, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": true, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 35, "minimumTaxAnnualized": 25, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "No small-company eligibility", "exit": "Two-thirds default" }, "scoreRange": [ 67, 67 ], "tax": { "code": "SC", "incomeSummary": "South Carolina C-corporation income tax is 5% of South Carolina taxable income, beginning with federal taxable income, state modifications and applicable allocation/apportionment. Special banks, savings institutions and other classifications have different rates.", "recurringSummary": "Ordinary corporations owe an annual license fee of $15 plus 0.1% of capital and paid-in surplus, with a $25 minimum. The license fee is paid with the income return and covers the following year. A separate $25 initial CL-1 license fee is due on incorporation/qualification; dormant corporations still owe the annual minimum.", "formationAnnualTaxFloor": 25, "floorBasis": "Ordinary domestic C-corporation $25 annual license minimum from charter until voluntary dissolution, even if dormant. Excludes benefit-report registry fees, initial CL-1 charge, higher capital, final-return/proration effects, special entities and other taxes.", "scenarioMinimum": 25, "scenarioBasis": "Small active domestic C corporation in a regular full year after formation, no taxable profit and capital/paid-in-surplus license computation no greater than $25. Do not add the one-time initial CL-1 fee again; annual benefit-report fees are separate.", "operatingTaxCaution": "SCDOR requires filing from charter/authority through recorded dissolution/withdrawal, even without income. Multistate corporations calculate their own apportionment for both taxable income and the license fee; short-period and final-return rules change timing rather than establish a general $0 annual tax.", "sources": [ { "label": "South Carolina DOR: C-corporation income rate and annual license formula", "url": "https://www.dor.sc.gov/business-income-taxes/corporate/c-corporation", "checked": "2026-10-11", "section": "South Carolina DOR: C-corporation income rate and annual license formula" }, { "label": "South Carolina DOR: initial, dormant, apportionment and final-return FAQ", "url": "https://dor.sc.gov/business-income-taxes/corporate/corporate-faqs", "checked": "2026-10-11", "section": "South Carolina DOR: initial, dormant, apportionment and final-return FAQ" } ] }, "conversion": { "state": "South Carolina", "code": "SC", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of each class, including nonvoting", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Two-thirds of every class/series including nonvoting for entry/exit and specified asset transactions.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://www.scstatehouse.gov/code/t33c038.php", "section": "\u00a733-38-230" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is required. A specific public benefit must be identified at formation under \u00a733-38-200, as confirmed by SOS formation form F0009 item 6 and its FY2025 statutory explanation. Section 33-38-300(B) nevertheless uses optional wording for specific purposes. Include a specific mission when forming; the inconsistent purpose-section wording remains a real drafting distinction.", "difference": "South Carolina offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Ordinary charter director exculpation restricted to SEC-registered voting-share companies, \u2265$25m assets, OR \u2265500 shareholders. Exceptions include loyalty, bad faith, GROSS NEGLIGENCE, intentional misconduct/knowing violation, unlawful distributions, improper personal benefit. Small private startups do not qualify; no officer clause. Benefit-specific rule: Corporation mission-failure damages barred. Directors/officers protected for compliant-duty conduct and mission failure. Benefit-director immunity excludes improper personal benefit, wilful misconduct or knowing law violations.", "difference": "South Carolina\u2019s ordinary charter shield has public-company/size eligibility gates, so the new small private company receives no ordinary director credit. Benefit-specific rules remain separate." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders by earlier of 120 days or another annual shareholder report; all benefit reports public online, free latest copy on request if no website. SOS form F0018 supplies the state-filing route: attach latest shareholder benefit report, submit two copies and $10 to SOS Corporate Filings. Ordinary annual Schedule D goes to DOR with the corporate tax return. Assessment rule: Third-party assessment standard required; performance assessment need not be performed, audited or certified by third party.", "difference": "South Carolina: Annual; Required outside framework; state benefit-report filing. An additional benefit-director or approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $10 per year on an annualized basis. Minimum tax/license used here: $25. Small active domestic C corporation in a regular full year after formation, no taxable profit and capital/paid-in-surplus license computation no greater than $25. Do not add the one-time initial CL-1 fee again; annual benefit-report fees are separate.", "difference": "South Carolina has a compared recurring floor of $35 per year, including $25 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of each class, including nonvoting. Two-thirds of every class/series including nonvoting for entry/exit and specified asset transactions. Changing back: two-thirds of each class, including nonvoting", "difference": "South Carolina entry uses two-thirds of each class, including nonvoting; exit uses two-thirds of each class, including nonvoting. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration; charter may prioritize mission. Independent benefit director required for all, including private corporations. Disclosure: Annual to shareholders by earlier of 120 days or another annual shareholder report; all benefit reports public online, free latest copy on request if no website. SOS form F0018 supplies the state-filing route: attach latest shareholder benefit report, submit two copies and $10 to SOS Corporate Filings. Ordinary annual Schedule D goes to DOR with the corporate tax return. Enforcement: Corporation; any shareholder, director, 5% parent equity, charter/bylaw designees.", "difference": "South Carolina requires public access to the report. Independent benefit director required; any qualifying shareholder can enforce. Formation requires a specific public mission in current SOS practice despite optional wording in the purpose section; annual benefit filing is $10 in addition to the DOR license minimum." } } }, "guideUrl": "/assets/state-guides/SC.md" }, { "state": "South Dakota", "abbreviation": "SD", "form": "Proposed public benefit corporation; not enacted", "status": "Gap", "reviewed": "2026-10-11", "family": "no dedicated form identified", "features": { "purpose": { "summary": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ], "generalRequired": null, "specificRequired": null, "specificOptional": null }, "board": { "summary": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ], "mode": "ordinary_corporation" }, "standard": { "summary": "No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ], "thirdPartyRequired": null, "certificationRequired": null }, "report": { "summary": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ], "cadence": "not_applicable", "shareholders": null, "publicWebsite": null, "stateFiling": null, "public": null }, "enforcement": { "summary": "No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ], "shareholderThreshold": "No dedicated benefit proceeding" }, "benefitLiability": { "summary": "No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a747-1A-833 and intentional criminal-law violations. Officer standards and indemnification remain separate.", "sources": [ { "url": "https://www.sdlegislature.gov/api/Statutes/47-1A.html?all=true", "section": "\u00a747-1A-202.1(4), current complete chapter" } ], "director": true, "officer": false, "automatic": false }, "statusChange": { "summary": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ], "entryVote": "not_applicable", "exitVote": "not_applicable", "optionalLock": false } }, "costs": { "regularReport": { "amount": 55, "cadence": "annual", "conditions": "Current agency table: $55 electronic annual report, $70 paper; older $50/$65 instructions conflict.", "summary": "Current agency table: $55 electronic annual report, $70 paper; older $50/$65 instructions conflict.", "sources": [ { "url": "https://sdsos.gov/general-information/filing-fees.aspx", "section": "Corporate report fees" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate statutory benefit form/report identified.", "summary": "No separate statutory benefit form/report identified.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ] }, "minimumTax": { "amount": 0, "conditions": "No general corporate income tax for this ordinary civic technology company. Sales/use, municipal and employment-related obligations can still apply. Bank franchise taxation belongs to a different industry and is outside this selected company scope.", "summary": "No general corporate income tax for this ordinary civic technology company. Sales/use, municipal and employment-related obligations can still apply. Bank franchise taxation belongs to a different industry and is outside this selected company scope.", "sources": [ { "url": "https://dor.sd.gov/businesses/taxes/", "section": "No general corporate income tax; activity-specific taxes" }, { "label": "South Dakota Revenue: business tax regimes and no corporate income tax", "url": "https://dor.sd.gov/businesses/taxes/", "checked": "2026-10-11", "section": "South Dakota Revenue: business tax regimes and no corporate income tax" }, { "label": "South Dakota Revenue: bank franchise tax is for covered financial institutions", "url": "https://dor.sd.gov/businesses/taxes/bank-franchise-tax/", "checked": "2026-10-11", "section": "South Dakota Revenue: bank franchise tax is for covered financial institutions" }, { "label": "South Dakota Revenue: sales/use tax, municipal obligations, and nexus", "url": "https://dor.sd.gov/businesses/taxes/sales-use-tax/", "checked": "2026-10-11", "section": "South Dakota Revenue: sales/use tax, municipal obligations, and nexus" } ] } }, "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" }, { "url": "https://www.sdlegislature.gov/api/Statutes/47-1A.html?all=true", "section": "\u00a747-1A-202.1(4), current complete chapter" }, { "url": "https://sdsos.gov/general-information/filing-fees.aspx", "section": "Corporate report fees" }, { "url": "https://dor.sd.gov/businesses/taxes/", "section": "No general corporate income tax; activity-specific taxes" }, { "label": "South Dakota Revenue: business tax regimes and no corporate income tax", "url": "https://dor.sd.gov/businesses/taxes/", "checked": "2026-10-11", "section": "South Dakota Revenue: business tax regimes and no corporate income tax" }, { "label": "South Dakota Revenue: bank franchise tax is for covered financial institutions", "url": "https://dor.sd.gov/businesses/taxes/bank-franchise-tax/", "checked": "2026-10-11", "section": "South Dakota Revenue: bank franchise tax is for covered financial institutions" }, { "label": "South Dakota Revenue: sales/use tax, municipal obligations, and nexus", "url": "https://dor.sd.gov/businesses/taxes/sales-use-tax/", "checked": "2026-10-11", "section": "South Dakota Revenue: sales/use tax, municipal obligations, and nexus" } ], "differences": [ "Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a747-1A-833 and intentional criminal-law violations. Officer standards and indemnification remain separate.", "Current agency table: $55 electronic annual report, $70 paper; older $50/$65 instructions conflict.", "The form-availability gap is the only shared grouping; ordinary protections and charges differ." ], "gaps": [ "Ordinary charter protections concern specified internal monetary claims; personally committed wrongs and liabilities imposed by other statutes remain separate." ], "confidence": "Current fee source; official ordinary-code verification where stated", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 0, 0 ], "reason": "Proposed public benefit corporation; not enacted. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "South Dakota has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason. A nonprofit public-benefit corporation is a different entity and does not fill this for-profit gap.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 6, 6 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "South Dakota has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a747-1A-833 and intentional criminal-law violations. Officer standards and indemnification remain separate.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "South Dakota does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "South Dakota requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "South Dakota has no separately credited benefit-specific monetary shield for company. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "South Dakota has no separately credited benefit-specific monetary shield for directors. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "South Dakota has no separately credited benefit-specific monetary shield for officers. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 0, 0 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "South Dakota: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "South Dakota: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "South Dakota: No dedicated form. No dedicated benefit form means this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "South Dakota has no dedicated benefit form, so this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $55 + benefit filing $0 = $55 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "South Dakota has a compared recurring floor of $55 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic civic/technology stock C corporation operating in South Dakota, outside bank/regulated-industry regimes: $0 general corporate income or franchise/capital minimum. Excludes report, sales/use, employment, property, and local charges. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "South Dakota: becoming a benefit company requires No dedicated for-profit benefit election applies. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "South Dakota: changing back requires not_applicable. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "South Dakota has no dedicated benefit-report rule in this ordinary form, so it receives no benefit-publication credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "South Dakota: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "South Dakota: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "South Dakota has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 55, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "not_applicable", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 55, "minimumTaxAnnualized": 0, "entryCategory": "not_applicable" }, "grouping": { "assessment": "No dedicated form", "cadence": "No dedicated form", "filing": "No dedicated form", "ordinaryScope": "Director scope only", "exit": "No dedicated form" }, "scoreRange": [ 18, 18 ], "tax": { "code": "SD", "incomeSummary": "South Dakota does not impose a general corporate income tax. The ordinary civic/technology stock C corporation is outside the separately imposed bank franchise-tax regime.", "recurringSummary": "No general fixed corporate franchise/capital tax is identified for an ordinary domestic civic/technology corporation in South Dakota's tax regime. Bank franchise tax is restricted to covered financial institutions. Annual corporate report charges and activity-specific licenses are separate; no corporate income tax does not mean no business taxes.", "formationAnnualTaxFloor": null, "floorBasis": "No positive general state tax floor solely from ordinary domestic stock-corporation status. Scope excludes covered financial institutions, registry/report fees, industry licenses, and sales/employment/property taxes.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic civic/technology stock C corporation operating in South Dakota, outside bank/regulated-industry regimes: $0 general corporate income or franchise/capital minimum. Excludes report, sales/use, employment, property, and local charges.", "operatingTaxCaution": "South Dakota taxes many products and services through state and municipal sales/use taxes, and a taxable business may need licensing even when no corporate income tax applies. Remote-seller and other nexus rules can apply to activity irrespective of charter state. Federal tax and taxes in other operating states remain separate.", "sources": [ { "label": "South Dakota Revenue: business tax regimes and no corporate income tax", "url": "https://dor.sd.gov/businesses/taxes/", "checked": "2026-10-11", "section": "South Dakota Revenue: business tax regimes and no corporate income tax" }, { "label": "South Dakota Revenue: bank franchise tax is for covered financial institutions", "url": "https://dor.sd.gov/businesses/taxes/bank-franchise-tax/", "checked": "2026-10-11", "section": "South Dakota Revenue: bank franchise tax is for covered financial institutions" }, { "label": "South Dakota Revenue: sales/use tax, municipal obligations, and nexus", "url": "https://dor.sd.gov/businesses/taxes/sales-use-tax/", "checked": "2026-10-11", "section": "South Dakota Revenue: sales/use tax, municipal obligations, and nexus" } ] }, "conversion": { "state": "South Dakota", "code": "SD", "form": "Proposed public benefit corporation; not enacted", "status": "Gap", "group": "gap", "groupLabel": "Enact a benefit option", "entryVote": "No dedicated for-profit benefit election applies", "route": "No same-state benefit-status amendment route identified; a benefit chapter is needed. A move to another jurisdiction requires its own authorized domestication, conversion or merger route.", "currentDetail": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "proposal": "Enact a for-profit benefit chapter with a same-company amendment route, ordinary amendment voting and usable agency forms.", "sources": [ { "url": "https://sdlegislature.gov/Statutes/47", "section": "SDCL Title 47; 2026 HB 1154 deferred" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "difference": "South Dakota has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a747-1A-833 and intentional criminal-law violations. Officer standards and indemnification remain separate. Benefit-specific rule: No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "difference": "South Dakota keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Director-only opt-in articles limit for monetary claims by the corporation or shareholders. Exceptions: unentitled financial benefit, intentional harm, unlawful distributions under \u00a747-1A-833 and intentional criminal-law violations. Officer standards and indemnification remain separate." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Assessment rule: No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "difference": "No benefit reporting credit applies because this state does not offer the requested form; that does not mean an ordinary company has no filings." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $55 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic civic/technology stock C corporation operating in South Dakota, outside bank/regulated-industry regimes: $0 general corporate income or franchise/capital minimum. Excludes report, sales/use, employment, property, and local charges.", "difference": "South Dakota has a compared recurring floor of $55 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: No dedicated for-profit benefit election applies. Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules. Changing back: not_applicable", "difference": "No direct benefit-status election or exit exists in this state; an interstate move or a law change is a different process." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute. Disclosure: No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Enforcement: No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "difference": "The ordinary corporation has no dedicated statutory benefit duty/report in this reviewed form. That is why it receives no benefit-accountability credit." } } }, "guideUrl": "/assets/state-guides/SD.md" }, { "state": "Tennessee", "abbreviation": "TN", "form": "For-profit benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "Specific-benefit mandatory consideration; annual public narrative report", "features": { "purpose": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-104" } ], "confidence": "medium", "generalRequired": false, "specificRequired": true, "specificOptional": false, "summary": "For-profit benefit charter must name one or more public benefits; no separate broad general-benefit purpose required." }, "board": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-106" } ], "confidence": "medium", "mode": "mandatory_consideration_no_permanent_priority", "summary": "Director shall consider materially affected interests including shareholders and chosen benefits; shall not give regular/presumptive/permanent priority to a constituency. This is consideration/no-fixed-priority wording, not the three-interest balancing text. Charter may opt in to disinterested-failure safe harbor." }, "standard": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-107(f)" }, { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-107(c),(f)" } ], "confidence": "medium", "required": false, "summary": "Optional through charter/bylaws. Not required; charter/bylaws may add it.", "thirdPartyRequired": false, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-107(c),(f)" } ], "confidence": "medium", "required": false, "summary": "Not required; charter/bylaws may add it." }, "report": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-107" } ], "confidence": "medium", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "summary": "Annual narrative delivered to shareholders within four months after fiscal year-end; all reports public website/latest free copy if no website. No state benefit-report filing specified." }, "enforcement": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-108" } ], "confidence": "medium", "threshold": "2% total at filing; listed alternative $2m", "summary": "Derivative enforcement of director mission duties by 2% total shareholders at filing, or listed lesser 2%/$2m." }, "benefitLiability": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-106; full adopted benefit chapter" } ], "confidence": "medium", "company": false, "directors": false, "officers": false, "summary": "Director performing mission duties not liable by virtue of being director; charter may protect disinterested failures from bad-faith/loyalty classification. No blanket corporate or distinct officer benefit-failure monetary bar in the enacted benefit text." }, "ordinaryExculpation": { "sources": [ { "url": "https://tpucdockets.tn.gov/archive/filings/2000/0001151g.pdf", "section": "Official Tennessee agency-hosted SS-4417 charter instructions, paragraph 7, referencing T.C.A. 48-12-102(b)" }, { "url": "https://www.sec.gov/Archives/edgar/data/36966/000093041325001672/c112616_s3asr.htm", "section": "First Horizon May 7, 2025 SEC registration statement, Item 15: confirms optional director charter authority; issuer primary filing" }, { "url": "https://www.sec.gov/Archives/edgar/data/880026/000119312508163904/dex3117.htm", "section": "Filed Tennessee charter, paragraph 9: director carve-outs; archived issuer primary document" }, { "url": "https://law.justia.com/codes/tennessee/title-48/for-profit-business-corporations/chapter-12/section-48-12-102/", "section": "2025 republication of T.C.A. 48-12-102(b)(3), used to cross-check current exceptions; unofficial statutory republication" } ], "confidence": "medium", "director": true, "officer": false, "optIn": true, "charterDirector": true, "charterOfficer": false, "summary": "Optional charter monetary exculpation covers directors in internal corporation/shareholder fiduciary-duty claims. It does not extend the charter shield to officers acting solely as officers. Exceptions preserve loyalty breaches, bad faith, intentional misconduct, knowing law violations and unlawful-distribution liability; prospective only. Members of a substituted governing body are treated as directors. Ordinary good-faith conduct standards and officer/director indemnification are separate mechanisms. Director-only charter authority is confirmed by official SOS-form instructions and 2025 primary issuer filings; source dates are stated because current public code viewing requires acceptance of provider terms.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-104" } ], "confidence": "medium", "entry": "2/3 each class", "exit": "2/3 each class", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "2/3 each outstanding class voting/nonvoting for entry/exit, chosen-benefit change and covered transactions; dissent payment rights. Surviving benefit purpose must be same/substantially same for stated merger exception.", "exitVote": "2/3 each class", "entryVote": "2/3 each class" } }, "costs": { "regularReport": { "sources": [ { "url": "https://sos.tn.gov/businesses/forms-and-fees", "section": "Corporations annual report fee" } ], "confidence": "high", "amount": 20, "cadence": "annual", "online": 20, "paper": 20, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Ordinary corporation annual report $20, excluding $20 agent-change surcharge.", "conditions": "Ordinary corporation annual report $20, excluding $20 agent-change surcharge." }, "benefitReport": { "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-107" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://www.tn.gov/content/dam/tn/revenue/documents/taxpayer_education/fae/Tax_Basics.pdf", "section": "Franchise and Excise Tax Basics: minimum franchise tax" }, { "label": "Tennessee Revenue: registered-entity franchise/excise scope and $100 inactive/active minimum", "url": "https://www.tn.gov/revenue/taxes/franchise---excise-tax.html.html", "checked": "2026-10-11", "section": "Tennessee Revenue: registered-entity franchise/excise scope and $100 inactive/active minimum" }, { "label": "Tennessee Revenue: current franchise and excise tax rates", "url": "https://www.tn.gov/revenue/taxes/franchise---excise-tax/due-dates-and-tax-rates.html.html", "checked": "2026-10-11", "section": "Tennessee Revenue: current franchise and excise tax rates" }, { "label": "Tennessee Revenue: $50,000 standard excise deduction and pre-apportionment calculation", "url": "https://www.tn.gov/content/dam/tn/revenue/documents/notices/fae/23-04fe.pdf", "checked": "2026-10-11", "section": "Tennessee Revenue: $50,000 standard excise deduction and pre-apportionment calculation" }, { "label": "Tennessee Revenue: current franchise/excise manual, property-measure repeal and apportionment transition", "url": "https://www.tn.gov/content/dam/tn/revenue/documents/tax_manuals/june-2025/Frachise-Excise-Tax-Manual.pdf", "checked": "2026-10-11", "section": "Tennessee Revenue: current franchise/excise manual, property-measure repeal and apportionment transition" }, { "label": "Tennessee Revenue: standard single-sales-factor formula from tax years ending December 31, 2025", "url": "https://revenue.support.tn.gov/hc/en-us/articles/360058264151-F-E-Apportionment-9-Single-Sales-Factor-Apportionment-Three-Year-Phase-In", "checked": "2026-10-11", "section": "Tennessee Revenue: standard single-sales-factor formula from tax years ending December 31, 2025" }, { "label": "Tennessee Revenue: business-tax threshold and state/city scope", "url": "https://www.tn.gov/content/tn/revenue/taxes/business-tax.html", "checked": "2026-10-11", "section": "Tennessee Revenue: business-tax threshold and state/city scope" }, { "label": "Tennessee Revenue: minimal-activity/standard business licenses, $15 renewal and $22 minimum", "url": "https://revenue.support.tn.gov/hc/en-us/articles/360057134532-BUS-13-Business-Licenses-Overview", "checked": "2026-10-11", "section": "Tennessee Revenue: minimal-activity/standard business licenses, $15 renewal and $22 minimum" } ], "confidence": "high", "amount": 100, "cadence": "annual", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Minimum Tennessee franchise tax $100 for taxable registered/chartered entities, even inactive; exemptions and other excise/franchise amounts require separate calculation.", "conditions": "Minimum Tennessee franchise tax $100 for taxable registered/chartered entities, even inactive; exemptions and other excise/franchise amounts require separate calculation." } }, "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-104" }, { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-106" }, { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-107(f)" }, { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-107(c),(f)" }, { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-107" }, { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-108" }, { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-106; full adopted benefit chapter" }, { "url": "https://tpucdockets.tn.gov/archive/filings/2000/0001151g.pdf", "section": "Official Tennessee agency-hosted SS-4417 charter instructions, paragraph 7, referencing T.C.A. 48-12-102(b)" }, { "url": "https://www.sec.gov/Archives/edgar/data/36966/000093041325001672/c112616_s3asr.htm", "section": "First Horizon May 7, 2025 SEC registration statement, Item 15: confirms optional director charter authority; issuer primary filing" }, { "url": "https://www.sec.gov/Archives/edgar/data/880026/000119312508163904/dex3117.htm", "section": "Filed Tennessee charter, paragraph 9: director carve-outs; archived issuer primary document" }, { "url": "https://law.justia.com/codes/tennessee/title-48/for-profit-business-corporations/chapter-12/section-48-12-102/", "section": "2025 republication of T.C.A. 48-12-102(b)(3), used to cross-check current exceptions; unofficial statutory republication" }, { "url": "https://sos.tn.gov/businesses/forms-and-fees", "section": "Corporations annual report fee" }, { "url": "https://www.tn.gov/content/dam/tn/revenue/documents/taxpayer_education/fae/Tax_Basics.pdf", "section": "Franchise and Excise Tax Basics: minimum franchise tax" }, { "label": "Tennessee Revenue: registered-entity franchise/excise scope and $100 inactive/active minimum", "url": "https://www.tn.gov/revenue/taxes/franchise---excise-tax.html.html", "checked": "2026-10-11", "section": "Tennessee Revenue: registered-entity franchise/excise scope and $100 inactive/active minimum" }, { "label": "Tennessee Revenue: current franchise and excise tax rates", "url": "https://www.tn.gov/revenue/taxes/franchise---excise-tax/due-dates-and-tax-rates.html.html", "checked": "2026-10-11", "section": "Tennessee Revenue: current franchise and excise tax rates" }, { "label": "Tennessee Revenue: $50,000 standard excise deduction and pre-apportionment calculation", "url": "https://www.tn.gov/content/dam/tn/revenue/documents/notices/fae/23-04fe.pdf", "checked": "2026-10-11", "section": "Tennessee Revenue: $50,000 standard excise deduction and pre-apportionment calculation" }, { "label": "Tennessee Revenue: current franchise/excise manual, property-measure repeal and apportionment transition", "url": "https://www.tn.gov/content/dam/tn/revenue/documents/tax_manuals/june-2025/Frachise-Excise-Tax-Manual.pdf", "checked": "2026-10-11", "section": "Tennessee Revenue: current franchise/excise manual, property-measure repeal and apportionment transition" }, { "label": "Tennessee Revenue: standard single-sales-factor formula from tax years ending December 31, 2025", "url": "https://revenue.support.tn.gov/hc/en-us/articles/360058264151-F-E-Apportionment-9-Single-Sales-Factor-Apportionment-Three-Year-Phase-In", "checked": "2026-10-11", "section": "Tennessee Revenue: standard single-sales-factor formula from tax years ending December 31, 2025" }, { "label": "Tennessee Revenue: business-tax threshold and state/city scope", "url": "https://www.tn.gov/content/tn/revenue/taxes/business-tax.html", "checked": "2026-10-11", "section": "Tennessee Revenue: business-tax threshold and state/city scope" }, { "label": "Tennessee Revenue: minimal-activity/standard business licenses, $15 renewal and $22 minimum", "url": "https://revenue.support.tn.gov/hc/en-us/articles/360057134532-BUS-13-Business-Licenses-Overview", "checked": "2026-10-11", "section": "Tennessee Revenue: minimal-activity/standard business licenses, $15 renewal and $22 minimum" } ], "differences": [ "Consideration plus no permanent constituency priority, not Delaware balance text.", "Mandatory public annual narrative, third-party optional.", "Minimum franchise tax separate from $20 report." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "Benefit law read in adopted SA0433 (2015) and official enactment history; ordinary charter mechanism read in official agency-hosted form and current issuer primary filing, with the 2025 unofficial statutory republication used to cross-check exact exceptions. The paid-provider public-code terms were not accepted.", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "For-profit benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Tennessee offers For-profit benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 10, 10 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Tennessee has an identified director monetary-protection provision in the compared scope, which earns this credit. Optional charter monetary exculpation covers directors in internal corporation/shareholder fiduciary-duty claims. It does not extend the charter shield to officers acting solely as officers. Exceptions preserve loyalty breaches, bad faith, intentional misconduct, knowing law violations and unlawful-distribution liability; prospective only. Members of a substituted governing body are treated as directors. Ordinary good-faith conduct standards and officer/director indemnification are separate mechanisms. Director-only charter authority is confirmed by official SOS-form instructions and 2025 primary issuer filings; source dates are stated because current public code viewing requires acceptance of provider terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Tennessee does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Tennessee requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separate company outcome-bar credit.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Tennessee has no separately credited benefit-specific monetary shield for company. Director performing mission duties not liable by virtue of being director; charter may protect disinterested failures from bad-faith/loyalty classification. No blanket corporate or distinct officer benefit-failure monetary bar in the enacted benefit text.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Compliant-director-duty protection receives 4 points; not a blanket outcome guarantee.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Tennessee earns the benefit-specific credit for directors. Director performing mission duties not liable by virtue of being director; charter may protect disinterested failures from bad-faith/loyalty classification. No blanket corporate or distinct officer benefit-failure monetary bar in the enacted benefit text.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Tennessee has no separately credited benefit-specific monetary shield for officers. Director performing mission duties not liable by virtue of being director; charter may protect disinterested failures from bad-faith/loyalty classification. No blanket corporate or distinct officer benefit-failure monetary bar in the enacted benefit text.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Tennessee: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Tennessee: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Tennessee: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Tennessee has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 9, 9 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 9, 9 ], "reason": "Ordinary reporting $20 + benefit filing $0 = $20 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Tennessee has a compared recurring floor of $120 per year, including $100 in identified minimum tax/license charges. Small active nonexempt domestic C corporation with apportioned net worth at or below $40,000, no Tennessee taxable net earnings, and no standard business-license tax obligation: $100 franchise minimum. Below-$100,000 receipts remove ordinary business tax when correctly licensed; conditional $15 county/city minimal-activity license fees are outside this state-tax-only amount. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "2/3 each outstanding class voting/nonvoting for entry/exit, chosen-benefit change and covered transactions; dissent payment rights. Surviving benefit purpose must be same/substantially same for stated merger exception.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Tennessee: becoming a benefit company requires 2/3 each class. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Tennessee: changing back requires 2/3 each class. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 17, 17 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Tennessee requires report access for people outside the company, so it earns public-access credit. Annual narrative delivered to shareholders within four months after fiscal year-end; all reports public website/latest free copy if no website. No state benefit-report filing specified.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Tennessee: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Tennessee: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Tennessee makes a mission duty mandatory, so it earns this credit. Director shall consider materially affected interests including shareholders and chosen benefits; shall not give regular/presumptive/permanent priority to a constituency. This is consideration/no-fixed-priority wording, not the three-interest balancing text. Charter may opt in to disinterested-failure safe harbor.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 20, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 120, "minimumTaxAnnualized": 100, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 70, 70 ], "tax": { "code": "TN", "incomeSummary": "Tennessee's ordinary excise tax is 6.5% of Tennessee taxable income. For tax years ending on or after December 31, 2024, taxpayers receive a standard deduction up to $50,000 of pre-apportioned adjusted net earnings; it cannot create or enlarge a net loss. Franchise tax is a separate net-worth tax.", "recurringSummary": "Franchise tax is 0.25% of Tennessee-apportioned net worth, with a $100 minimum for nonexempt entities incorporated, domesticated, qualified, or registered in Tennessee, whether active or inactive. The former property-value alternative minimum measure was repealed. Tennessee business tax also depends on taxable receipts/classification and has a $22 ordinary minimum for standard-license taxpayers; local minimal-activity licenses can renew for $15 each where receipts exceed $3,000 but are below $100,000.", "formationAnnualTaxFloor": 100, "floorBasis": "$100 annual franchise-tax minimum for a nonexempt domestic ordinary stock corporation in a regular year. Excludes excise tax above the earnings deduction, higher net-worth tax, conditional business tax/local license fees, registry/report fees, and penalties.", "scenarioMinimum": 100, "scenarioBasis": "Small active nonexempt domestic C corporation with apportioned net worth at or below $40,000, no Tennessee taxable net earnings, and no standard business-license tax obligation: $100 franchise minimum. Below-$100,000 receipts remove ordinary business tax when correctly licensed; conditional $15 county/city minimal-activity license fees are outside this state-tax-only amount.", "operatingTaxCaution": "Franchise/excise registration, nexus, and apportionment matter independently of income. Ordinary apportioning taxpayers use single-sales-factor apportionment for tax years ending on or after December 31, 2025, subject to industry exceptions. Gross-receipts business tax and county/city licenses have separate sourcing, location, thresholds, and renewal rules; a zero-profit corporation can still owe these charges.", "sources": [ { "label": "Tennessee Revenue: registered-entity franchise/excise scope and $100 inactive/active minimum", "url": "https://www.tn.gov/revenue/taxes/franchise---excise-tax.html.html", "checked": "2026-10-11", "section": "Tennessee Revenue: registered-entity franchise/excise scope and $100 inactive/active minimum" }, { "label": "Tennessee Revenue: current franchise and excise tax rates", "url": "https://www.tn.gov/revenue/taxes/franchise---excise-tax/due-dates-and-tax-rates.html.html", "checked": "2026-10-11", "section": "Tennessee Revenue: current franchise and excise tax rates" }, { "label": "Tennessee Revenue: $50,000 standard excise deduction and pre-apportionment calculation", "url": "https://www.tn.gov/content/dam/tn/revenue/documents/notices/fae/23-04fe.pdf", "checked": "2026-10-11", "section": "Tennessee Revenue: $50,000 standard excise deduction and pre-apportionment calculation" }, { "label": "Tennessee Revenue: current franchise/excise manual, property-measure repeal and apportionment transition", "url": "https://www.tn.gov/content/dam/tn/revenue/documents/tax_manuals/june-2025/Frachise-Excise-Tax-Manual.pdf", "checked": "2026-10-11", "section": "Tennessee Revenue: current franchise/excise manual, property-measure repeal and apportionment transition" }, { "label": "Tennessee Revenue: standard single-sales-factor formula from tax years ending December 31, 2025", "url": "https://revenue.support.tn.gov/hc/en-us/articles/360058264151-F-E-Apportionment-9-Single-Sales-Factor-Apportionment-Three-Year-Phase-In", "checked": "2026-10-11", "section": "Tennessee Revenue: standard single-sales-factor formula from tax years ending December 31, 2025" }, { "label": "Tennessee Revenue: business-tax threshold and state/city scope", "url": "https://www.tn.gov/content/tn/revenue/taxes/business-tax.html", "checked": "2026-10-11", "section": "Tennessee Revenue: business-tax threshold and state/city scope" }, { "label": "Tennessee Revenue: minimal-activity/standard business licenses, $15 renewal and $22 minimum", "url": "https://revenue.support.tn.gov/hc/en-us/articles/360057134532-BUS-13-Business-Licenses-Overview", "checked": "2026-10-11", "section": "Tennessee Revenue: minimal-activity/standard business licenses, $15 renewal and $22 minimum" } ] }, "conversion": { "state": "Tennessee", "code": "TN", "form": "For-profit benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 each class", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "2/3 each outstanding class voting/nonvoting for entry/exit, chosen-benefit change and covered transactions; dissent payment rights. Surviving benefit purpose must be same/substantially same for stated merger exception.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://capitol.tn.gov/Bills/109/Amend/SA0433.pdf", "section": "Adopted SA0433 to SB0972 (2015), T.C.A. 48-28-104" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "For-profit benefit charter must name one or more public benefits; no separate broad general-benefit purpose required.", "difference": "Tennessee offers For-profit benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Optional charter monetary exculpation covers directors in internal corporation/shareholder fiduciary-duty claims. It does not extend the charter shield to officers acting solely as officers. Exceptions preserve loyalty breaches, bad faith, intentional misconduct, knowing law violations and unlawful-distribution liability; prospective only. Members of a substituted governing body are treated as directors. Ordinary good-faith conduct standards and officer/director indemnification are separate mechanisms. Director-only charter authority is confirmed by official SOS-form instructions and 2025 primary issuer filings; source dates are stated because current public code viewing requires acceptance of provider terms. Benefit-specific rule: Director performing mission duties not liable by virtue of being director; charter may protect disinterested failures from bad-faith/loyalty classification. No blanket corporate or distinct officer benefit-failure monetary bar in the enacted benefit text.", "difference": "Tennessee keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. " }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual narrative delivered to shareholders within four months after fiscal year-end; all reports public website/latest free copy if no website. No state benefit-report filing specified. Assessment rule: Optional through charter/bylaws. Not required; charter/bylaws may add it.", "difference": "Tennessee: Annual; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $20 per year on an annualized basis. Minimum tax/license used here: $100. Small active nonexempt domestic C corporation with apportioned net worth at or below $40,000, no Tennessee taxable net earnings, and no standard business-license tax obligation: $100 franchise minimum. Below-$100,000 receipts remove ordinary business tax when correctly licensed; conditional $15 county/city minimal-activity license fees are outside this state-tax-only amount.", "difference": "Tennessee has a compared recurring floor of $120 per year, including $100 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 each class. 2/3 each outstanding class voting/nonvoting for entry/exit, chosen-benefit change and covered transactions; dissent payment rights. Surviving benefit purpose must be same/substantially same for stated merger exception. Changing back: 2/3 each class", "difference": "Tennessee entry uses 2/3 each class; exit uses 2/3 each class. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Director shall consider materially affected interests including shareholders and chosen benefits; shall not give regular/presumptive/permanent priority to a constituency. This is consideration/no-fixed-priority wording, not the three-interest balancing text. Charter may opt in to disinterested-failure safe harbor. Disclosure: Annual narrative delivered to shareholders within four months after fiscal year-end; all reports public website/latest free copy if no website. No state benefit-report filing specified. Enforcement: Derivative enforcement of director mission duties by 2% total shareholders at filing, or listed lesser 2%/$2m.", "difference": "Tennessee requires public access to the report. Mandatory public annual narrative, third-party optional. Minimum franchise tax separate from $20 report." } } }, "guideUrl": "/assets/state-guides/TN.md" }, { "state": "Texas", "abbreviation": "TX", "form": "Public benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "Specific-benefit three-interest balancing; biennial private default", "features": { "purpose": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.953" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.3.htm", "section": "Tex. Bus. Orgs. Code 3.007(e)" } ], "confidence": "high", "generalRequired": false, "specificRequired": true, "specificOptional": false, "summary": "PBC intended to operate responsibly/sustainably and produce benefit(s) specified in certificate; broad general benefit is not mandatory." }, "board": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.956" } ], "confidence": "high", "mode": "three_interest_balancing", "summary": "Board shall balance shareholders, materially affected persons and chosen benefits. Informed/disinterested/not-irrational decision satisfies duty. Charter may opt in to safe harbor for disinterested failures as not bad faith/loyalty breach; no beneficiary duty." }, "standard": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.957" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.957" } ], "confidence": "high", "required": false, "summary": "No mandatory third-party standard in PBC reporting statute. No mandatory certification in PBC reporting statute.", "thirdPartyRequired": false, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.957" } ], "confidence": "high", "required": false, "summary": "No mandatory certification in PBC reporting statute." }, "report": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.957" } ], "confidence": "high", "cadence": "biennial", "shareholders": true, "public": false, "stateFiling": false, "summary": "At least biennial shareholder statement with objectives, standards, facts and assessment. Charter/bylaws may require more frequent or public report; public/state benefit filing is not statutory default." }, "enforcement": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.958" } ], "confidence": "high", "threshold": "2% total; listed alternative $2m", "summary": "Derivative balancing action by shareholders owning 2% total or listed lesser 2%/$2m." }, "benefitLiability": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.951 through 21.958; especially 21.956" } ], "confidence": "high", "company": false, "directors": false, "officers": false, "summary": "No blanket corporate/director/officer benefit-failure damages bar in Subchapter S. Conditional director decision safe harbor and optional charter classification safe harbor interact with ordinary exculpation." }, "ordinaryExculpation": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.7.htm", "section": "Tex. Bus. Orgs. Code 7.001" }, { "url": "https://statutes.capitol.texas.gov/GetStatute.aspx?Code=BO&Value=1.002", "section": "BOC 1.002(52), managerial official" } ], "confidence": "high", "director": true, "officer": true, "optIn": true, "summary": "Charter may limit director AND officer monetary liability to organization/owners: managerial official includes both. Exceptions loyalty, bad faith constituting duty breach/intentional misconduct/known illegality, improper benefit, and liability expressly imposed by statute. Broader officer scope than director-only model states.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.954" } ], "confidence": "high", "entry": "2/3 outstanding entitled vote", "exit": "2/3 outstanding entitled vote", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "2/3 outstanding shares entitled to vote, class/series voting when otherwise required, for entry/exit and protected certificate provisions; dissent/appraisal rights. Mission/report provisions can survive equivalent-entity transaction exception.", "exitVote": "2/3 outstanding entitled vote", "entryVote": "2/3 outstanding entitled vote" } }, "costs": { "regularReport": { "sources": [ { "url": "https://comptroller.texas.gov/forms/05-915.pdf", "section": "2026 Franchise Tax Instructions: PIR still required" } ], "confidence": "medium", "amount": 0, "cadence": "annual", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Annual Comptroller public information report required; no separate ordinary stock-corporation annual report filing fee identified. Franchise tax separate.", "conditions": "Annual Comptroller public information report required; no separate ordinary stock-corporation annual report filing fee identified. Franchise tax separate." }, "benefitReport": { "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.957" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://comptroller.texas.gov/forms/05-915.pdf", "section": "2026 no tax due threshold" }, { "label": "Texas Comptroller: current 2026/2027 franchise rates and thresholds", "url": "https://comptroller.texas.gov/taxes/franchise/", "checked": "2026-10-11", "section": "Texas Comptroller: current 2026/2027 franchise rates and thresholds" }, { "label": "Texas Comptroller: 2026 franchise instructions, margin calculation, no minimum, and reporting", "url": "https://comptroller.texas.gov/forms/05-915.pdf", "checked": "2026-10-11", "section": "Texas Comptroller: 2026 franchise instructions, margin calculation, no minimum, and reporting" }, { "label": "Texas Comptroller: no-tax-due and under-$1,000 payment/report rules", "url": "https://comptroller.texas.gov/taxes/franchise/faq/reports-payments.php", "checked": "2026-10-11", "section": "Texas Comptroller: no-tax-due and under-$1,000 payment/report rules" }, { "label": "Texas Comptroller: foreign-entity economic nexus", "url": "https://comptroller.texas.gov/taxes/sales/remote-sellers.php", "checked": "2026-10-11", "section": "Texas Comptroller: foreign-entity economic nexus" } ], "confidence": "high", "amount": 0, "cadence": "annual", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "2026/2027 franchise no-tax-due revenue threshold $2,650,000; tax may apply above threshold. PIR/OIR still required below it.", "conditions": "2026/2027 franchise no-tax-due revenue threshold $2,650,000; tax may apply above threshold. PIR/OIR still required below it." } }, "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.953" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.3.htm", "section": "Tex. Bus. Orgs. Code 3.007(e)" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.956" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.957" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.958" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.951 through 21.958; especially 21.956" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.7.htm", "section": "Tex. Bus. Orgs. Code 7.001" }, { "url": "https://statutes.capitol.texas.gov/GetStatute.aspx?Code=BO&Value=1.002", "section": "BOC 1.002(52), managerial official" }, { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.954" }, { "url": "https://comptroller.texas.gov/forms/05-915.pdf", "section": "2026 Franchise Tax Instructions: PIR still required" }, { "url": "https://comptroller.texas.gov/forms/05-915.pdf", "section": "2026 no tax due threshold" }, { "label": "Texas Comptroller: current 2026/2027 franchise rates and thresholds", "url": "https://comptroller.texas.gov/taxes/franchise/", "checked": "2026-10-11", "section": "Texas Comptroller: current 2026/2027 franchise rates and thresholds" }, { "label": "Texas Comptroller: 2026 franchise instructions, margin calculation, no minimum, and reporting", "url": "https://comptroller.texas.gov/forms/05-915.pdf", "checked": "2026-10-11", "section": "Texas Comptroller: 2026 franchise instructions, margin calculation, no minimum, and reporting" }, { "label": "Texas Comptroller: no-tax-due and under-$1,000 payment/report rules", "url": "https://comptroller.texas.gov/taxes/franchise/faq/reports-payments.php", "checked": "2026-10-11", "section": "Texas Comptroller: no-tax-due and under-$1,000 payment/report rules" }, { "label": "Texas Comptroller: foreign-entity economic nexus", "url": "https://comptroller.texas.gov/taxes/sales/remote-sellers.php", "checked": "2026-10-11", "section": "Texas Comptroller: foreign-entity economic nexus" } ], "differences": [ "Biennial shareholder-only report default.", "Third-party standard/certification not required.", "Ordinary charter exculpation includes officers.", "2/3 voting shares differs from every class including nonvoting." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "Current official resource-server Chapter 21 was read instead of older statute URLs returning an application shell. Registry report itself has no separate required report charge; processing/service charges are excluded.", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Public benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Texas offers Public benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 14, 14 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Texas has an identified director monetary-protection provision in the compared scope, which earns this credit. Charter may limit director AND officer monetary liability to organization/owners: managerial official includes both. Exceptions loyalty, bad faith constituting duty breach/intentional misconduct/known illegality, improper benefit, and liability expressly imposed by statute. Broader officer scope than director-only model states.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Texas extends ordinary protection to officers, which earns officer-scope credit. Charter may limit director AND officer monetary liability to organization/owners: managerial official includes both. Exceptions loyalty, bad faith constituting duty breach/intentional misconduct/known illegality, improper benefit, and liability expressly imposed by statute. Broader officer scope than director-only model states.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Texas requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit decision / classification safe harbor", "range": [ 2, 2 ], "reason": "2 points instead of the separate company/director/officer outcome-bar credits. The cited safe harbor is not treated as a blanket mission-failure damages bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection for benefit decisions", "why": "Texas protects certain properly made or classified benefit decisions. This is narrower than an express company/director/officer bar on damages merely for missing the mission, so only the narrower safe-harbor credit applies. No blanket corporate/director/officer benefit-failure damages bar in Subchapter S. Conditional director decision safe harbor and optional charter classification safe harbor interact with ordinary exculpation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 23, 23 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 8, 8 ], "reason": "At least biennial reporting receives 8 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Texas: At least biennial. This gets more ease-of-operation credit than an annual mandate because reporting is less frequent or not mandatory.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Texas: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Texas: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Texas has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $0 + benefit filing $0 = $0 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Texas has a compared recurring floor of $0 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation with annualized total revenue from its entire business, including any required combined group, at or below $2,650,000 for its 2026/2027 report: $0 franchise tax. PIR/OIR remains required. Excludes other operating taxes and fees. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "2/3 outstanding shares entitled to vote, class/series voting when otherwise required, for entry/exit and protected certificate provisions; dissent/appraisal rights. Mission/report provisions can survive equivalent-entity transaction exception.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Texas: becoming a benefit company requires 2/3 outstanding entitled vote. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Texas: changing back requires 2/3 outstanding entitled vote. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 6, 6 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No statutory public benefit-report access mandate: 0 points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Texas has no mandatory public access in the compared variant, so it gets no public-access credit. Voluntary publication is still possible. At least biennial shareholder statement with objectives, standards, facts and assessment. Charter/bylaws may require more frequent or public report; public/state benefit filing is not statutory default.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 3, 3 ], "reason": "At least biennial reporting: 3 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Texas: At least biennial. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Texas: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Texas makes a mission duty mandatory, so it earns this credit. Board shall balance shareholders, materially affected persons and chosen benefits. Informed/disinterested/not-irrational decision satisfies duty. Charter may opt in to safe harbor for disinterested failures as not bad faith/loyalty breach; no beneficiary duty.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 0, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 0, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "At least biennial", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 76, 76 ], "tax": { "code": "TX", "incomeSummary": "Texas taxes the ordinary corporation through a franchise tax on apportioned taxable margin rather than a conventional corporate net-income tax. The applicable margin method and receipts thresholds therefore matter even when the corporation has no net profit.", "recurringSummary": "For 2026 and 2027 reports, the franchise no-tax-due threshold is annualized total revenue of $2,650,000 or less. Above it, standard rates are 0.75% of taxable margin, or 0.375% for qualifying retail/wholesale businesses. Eligible entities with revenue at most $20 million can elect EZ computation at 0.331%. No minimum franchise tax applies, and calculated tax below $1,000 is not payable, subject to special rules. PIR/OIR information reporting remains required below the revenue threshold.", "formationAnnualTaxFloor": null, "floorBasis": "No positive universal domestic-corporation franchise floor: the Comptroller states there is no minimum franchise tax, and liability is subject to revenue and tax-due thresholds. Excludes registry/info-report fees, specialized rules, and other operating taxes.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation with annualized total revenue from its entire business, including any required combined group, at or below $2,650,000 for its 2026/2027 report: $0 franchise tax. PIR/OIR remains required. Excludes other operating taxes and fees.", "operatingTaxCaution": "Texas formation itself brings an ordinary taxable entity into franchise-tax scope. Multistate taxable margin uses Texas receipt apportionment; foreign entities can also have physical or economic nexus. Threshold revenue is total annualized revenue, not just Texas receipts, and combined-group rules can change eligibility. Sales/use, employment, and local/industry taxes remain separate.", "sources": [ { "label": "Texas Comptroller: current 2026/2027 franchise rates and thresholds", "url": "https://comptroller.texas.gov/taxes/franchise/", "checked": "2026-10-11", "section": "Texas Comptroller: current 2026/2027 franchise rates and thresholds" }, { "label": "Texas Comptroller: 2026 franchise instructions, margin calculation, no minimum, and reporting", "url": "https://comptroller.texas.gov/forms/05-915.pdf", "checked": "2026-10-11", "section": "Texas Comptroller: 2026 franchise instructions, margin calculation, no minimum, and reporting" }, { "label": "Texas Comptroller: no-tax-due and under-$1,000 payment/report rules", "url": "https://comptroller.texas.gov/taxes/franchise/faq/reports-payments.php", "checked": "2026-10-11", "section": "Texas Comptroller: no-tax-due and under-$1,000 payment/report rules" }, { "label": "Texas Comptroller: foreign-entity economic nexus", "url": "https://comptroller.texas.gov/taxes/sales/remote-sellers.php", "checked": "2026-10-11", "section": "Texas Comptroller: foreign-entity economic nexus" } ] }, "conversion": { "state": "Texas", "code": "TX", "form": "Public benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 outstanding entitled vote", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "2/3 outstanding shares entitled to vote, class/series voting when otherwise required, for entry/exit and protected certificate provisions; dissent/appraisal rights. Mission/report provisions can survive equivalent-entity transaction exception.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://tcss.legis.texas.gov/resources/BO/htm/BO.21.htm", "section": "Tex. Bus. Orgs. Code 21.954" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "PBC intended to operate responsibly/sustainably and produce benefit(s) specified in certificate; broad general benefit is not mandatory.", "difference": "Texas offers Public benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Charter may limit director AND officer monetary liability to organization/owners: managerial official includes both. Exceptions loyalty, bad faith constituting duty breach/intentional misconduct/known illegality, improper benefit, and liability expressly imposed by statute. Broader officer scope than director-only model states. Benefit-specific rule: No blanket corporate/director/officer benefit-failure damages bar in Subchapter S. Conditional director decision safe harbor and optional charter classification safe harbor interact with ordinary exculpation.", "difference": "Texas adds ordinary officer coverage; the charter must elect the ordinary protection. Ordinary charter exculpation includes officers." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "At least biennial shareholder statement with objectives, standards, facts and assessment. Charter/bylaws may require more frequent or public report; public/state benefit filing is not statutory default. Assessment rule: No mandatory third-party standard in PBC reporting statute. No mandatory certification in PBC reporting statute.", "difference": "Texas: At least biennial; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $0 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation with annualized total revenue from its entire business, including any required combined group, at or below $2,650,000 for its 2026/2027 report: $0 franchise tax. PIR/OIR remains required. Excludes other operating taxes and fees.", "difference": "Texas has a compared recurring floor of $0 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 outstanding entitled vote. 2/3 outstanding shares entitled to vote, class/series voting when otherwise required, for entry/exit and protected certificate provisions; dissent/appraisal rights. Mission/report provisions can survive equivalent-entity transaction exception. Changing back: 2/3 outstanding entitled vote", "difference": "Texas entry uses 2/3 outstanding entitled vote; exit uses 2/3 outstanding entitled vote. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Board shall balance shareholders, materially affected persons and chosen benefits. Informed/disinterested/not-irrational decision satisfies duty. Charter may opt in to safe harbor for disinterested failures as not bad faith/loyalty breach; no beneficiary duty. Disclosure: At least biennial shareholder statement with objectives, standards, facts and assessment. Charter/bylaws may require more frequent or public report; public/state benefit filing is not statutory default. Enforcement: Derivative balancing action by shareholders owning 2% total or listed lesser 2%/$2m.", "difference": "Texas does not require public access in this compared variant. Biennial shareholder-only report default." } } }, "guideUrl": "/assets/state-guides/TX.md" }, { "state": "Utah", "abbreviation": "UT", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "general-benefit model with adjustable standing and division benefit-report filing", "features": { "purpose": { "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit is mandatory; a charter may add specific public benefits.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] } ] }, "board": { "model": "mandatory_stakeholder_consideration", "summary": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] } ], "mode": "mandatory_stakeholder_consideration" }, "standard": { "thirdPartyStandard": "required", "certificationRequired": false, "summary": "Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] } ], "thirdPartyRequired": true }, "report": { "cadence": "annual", "shareholders": true, "public": true, "stateFiling": true, "deadline": "Earlier of 120 days after fiscal year end or another annual shareholder report; file benefit report with division at normal annual-report renewal.", "redactions": "Director compensation and financial/proprietary information may be omitted publicly and from division copy.", "summary": "Annual shareholder and public benefit report, plus upload/file with the division when renewing the normal business report.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] }, { "id": "UT-filing", "url": "https://commerce.utah.gov/corporations/business-entities/benefit-corporation/", "section": "Division benefit-corporation annual-report instructions", "claims": [ "Upload benefit report at annual renewal" ] } ] }, "enforcement": { "threshold": "2% of a class/series at act/omission; director; 5% parent equity owner; authorized others. Articles may increase ownership requirements for a derivative proceeding.", "summary": "Unlike ordinary model defaults, \u00a716-10b-305(3)(b) permits charter increases to derivative ownership requirements.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] } ] }, "benefitLiability": { "company": "No monetary liability for failure to create benefit.", "directors": "Default compliant-duty/benefit-failure monetary bar, subject to contrary articles.", "officers": "Conditional stakeholder consideration; compliant conduct and benefit-failure monetary bar.", "summary": "Benefit director mandatory for publicly traded companies, optional for private companies; special benefit-director immunity excludes self-dealing, willful misconduct and knowing law violation.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] } ] }, "ordinaryExculpation": { "scope": "directors for ordinary civic/technology company; limited officer extension for regulated depository institutions", "activation": "Articles OR bylaws/resolution approved by same shareholder percentage as articles amendment.", "exceptions": [ "Improper financial benefit", "Intentional infliction of harm", "Specified unlawful distributions", "Intentional criminal-law violation", "Acts before the provision becomes effective" ], "summary": "\u00a716-10a-841, amended 2025, permits approved bylaws/resolution as well as articles. Officer extension concerns regulated banks/depository institutions and is not general officer protection.", "sources": [ { "id": "UT-ordinary", "url": "https://le.utah.gov/xcode/Title16/Chapter10A/C16-10a_1800010118000101.pdf", "section": "\u00a716-10a-841, amended 2025 ch.302", "claims": [ "Director limitation via articles or approved bylaws/resolution; regulated depository officer exception" ] } ] }, "statusChange": { "entryVote": "Two thirds of every class/series, including otherwise nonvoting shares; statutory short-form-merger exception.", "exitVote": "Same minimum status vote, with identified statutory merger exceptions.", "lock": "No unconditional permanent lock; nonordinary major asset disposition also requires minimum status vote.", "summary": "Model two-thirds class status protection, with statutory short-form transaction exceptions.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] } ] } }, "costs": { "regularReport": { "amount": 18, "cadence": "annual", "conditions": "FY2027 HB 8 \u00a73 authorizes $13 profit-corporation annual report (line7565) and $5 single-sign-on portal fee (line7640), effective July 1, 2026. The agency current schedule independently quotes $18 inclusive of that surcharge.", "summary": "FY2027 HB 8 \u00a73 authorizes $13 profit-corporation annual report (line7565) and $5 single-sign-on portal fee (line7640), effective July 1, 2026. The agency current schedule independently quotes $18 inclusive of that surcharge.", "sources": [ { "id": "UT-fees-FY2027", "url": "https://le.utah.gov/Session/2026/bills/enrolled/HB0008.pdf", "section": "2026 HB 8 \u00a7\u00a73\u20134; lines2925\u20132929,7564\u20137569,7639\u20137640; pp223\u2013226", "claims": [ "$13 profit annual report plus $5 portal fee for FY2027; approved fee list has no separately named benefit-report price." ] }, { "id": "UT-fees-FY2027-approval", "url": "https://governor.utah.gov/bills/", "section": "2026 General Legislative Session, March 26, 2026 HB 8", "claims": [ "FY2027 state-agency-fee bill signed March 26, 2026." ] } ] }, "benefitReport": { "amount": null, "cadence": "annual", "conditions": "\u00a716-10b-402(4) requires a separate benefit report at normal renewal and says the Division shall charge an established fee. FY2027 HB 8 approved-fee list and the agency current schedule have no separately named benefit-report price; agency instructions upload it within the renewal. This publication mismatch prevents a verified separate-price or all-in quote; $18 is the verified ordinary renewal charge.", "summary": "\u00a716-10b-402(4) requires a separate benefit report at normal renewal and says the Division shall charge an established fee. FY2027 HB 8 approved-fee list and the agency current schedule have no separately named benefit-report price; agency instructions upload it within the renewal. This publication mismatch prevents a verified separate-price or all-in quote; $18 is the verified ordinary renewal charge.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] }, { "id": "UT-filing", "url": "https://commerce.utah.gov/corporations/business-entities/benefit-corporation/", "section": "Division benefit-corporation annual-report instructions", "claims": [ "Upload benefit report at annual renewal" ] }, { "id": "UT-fees-FY2027", "url": "https://le.utah.gov/Session/2026/bills/enrolled/HB0008.pdf", "section": "2026 HB 8 \u00a7\u00a73\u20134; lines2925\u20132929,7564\u20137569,7639\u20137640; pp223\u2013226", "claims": [ "$13 profit annual report plus $5 portal fee for FY2027; approved fee list has no separately named benefit-report price." ] } ] }, "minimumTax": { "amount": 100, "cadence": "annual", "conditions": "C corporations filing TC-20 generally pay $100 minimum franchise/privilege tax even if inactive; income tax may exceed it.", "summary": "C corporations filing TC-20 generally pay $100 minimum franchise/privilege tax even if inactive; income tax may exceed it.", "sources": [ { "id": "UT-tax", "url": "https://tax.utah.gov/business/corporate-income-tax/c-corp-tax/", "section": "C Corporation Tax minimum privilege tax", "claims": [ "$100 annual minimum TC-20 tax" ] }, { "label": "Utah current Code 59-7-104, effective January 1, 2026: 4.45% and $100", "url": "https://le.utah.gov/xcode/Title59/Chapter7/C59-7-S104_2026050620260506.html", "checked": "2026-10-11", "section": "Utah current Code 59-7-104, effective January 1, 2026: 4.45% and $100" }, { "label": "Utah current Code 59-7-201, effective January 1, 2026: corporate income tax", "url": "https://le.utah.gov/xcode/Title59/Chapter7/C59-7-S201_2026050620260506.html", "checked": "2026-10-11", "section": "Utah current Code 59-7-201, effective January 1, 2026: corporate income tax" }, { "label": "Utah Tax Commission, C-corporation filing and $100 privilege minimum", "url": "https://tax.utah.gov/business/corporate-income-tax/c-corp-tax/", "checked": "2026-10-11", "section": "Utah Tax Commission, C-corporation filing and $100 privilege minimum" } ] } }, "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] }, { "id": "UT-ordinary", "url": "https://le.utah.gov/xcode/Title16/Chapter10A/C16-10a_1800010118000101.pdf", "section": "\u00a716-10a-841, amended 2025 ch.302", "claims": [ "Director limitation via articles or approved bylaws/resolution; regulated depository officer exception" ] }, { "id": "UT-filing", "url": "https://commerce.utah.gov/corporations/business-entities/benefit-corporation/", "section": "Division benefit-corporation annual-report instructions", "claims": [ "Upload benefit report at annual renewal" ] }, { "id": "UT-fees", "url": "https://commerce.utah.gov/wp-content/uploads/2023/04/currentfees.pdf", "section": "Current agency schedule, ordinary annual report inclusive of $5 surcharge", "claims": [ "$18 ordinary corporation renewal, surcharge included; no separately named benefit-report line item." ] }, { "id": "UT-tax", "url": "https://tax.utah.gov/business/corporate-income-tax/c-corp-tax/", "section": "C Corporation Tax minimum privilege tax", "claims": [ "$100 annual minimum TC-20 tax" ] }, { "id": "UT-fees-FY2027", "url": "https://le.utah.gov/Session/2026/bills/enrolled/HB0008.pdf", "section": "2026 HB 8 \u00a7\u00a73\u20134; lines2925\u20132929,7564\u20137569,7639\u20137640; pp223\u2013226", "claims": [ "$13 profit annual report plus $5 portal fee for FY2027; approved fee list has no separately named benefit-report price." ] }, { "id": "UT-fees-FY2027-approval", "url": "https://governor.utah.gov/bills/", "section": "2026 General Legislative Session, March 26, 2026 HB 8", "claims": [ "FY2027 state-agency-fee bill signed March 26, 2026." ] }, { "label": "Utah current Code 59-7-104, effective January 1, 2026: 4.45% and $100", "url": "https://le.utah.gov/xcode/Title59/Chapter7/C59-7-S104_2026050620260506.html", "checked": "2026-10-11", "section": "Utah current Code 59-7-104, effective January 1, 2026: 4.45% and $100" }, { "label": "Utah current Code 59-7-201, effective January 1, 2026: corporate income tax", "url": "https://le.utah.gov/xcode/Title59/Chapter7/C59-7-S201_2026050620260506.html", "checked": "2026-10-11", "section": "Utah current Code 59-7-201, effective January 1, 2026: corporate income tax" }, { "label": "Utah Tax Commission, C-corporation filing and $100 privilege minimum", "url": "https://tax.utah.gov/business/corporate-income-tax/c-corp-tax/", "checked": "2026-10-11", "section": "Utah Tax Commission, C-corporation filing and $100 privilege minimum" } ], "differences": [ "Articles can increase derivative benefit enforcement ownership requirements.", "2025 ordinary exculpation can be adopted through approved bylaws/resolution.", "October 1, 2026 organizational-law changes and new benefit LLC chapter must be distinguished from stock benefit corporations.", "State benefit report is required at renewal. Ordinary FY2027 renewal is $18; statutory separate-fee language and absence of a published benefit-report line item must be disclosed as a source discrepancy." ], "gaps": [ "The Division statute requires a benefit-report fee, but neither the FY2027 legislative approved-fee list nor current agency schedule names a separate benefit-report price. The report is uploaded in the ordinary renewal process; a distinct price cannot be truthfully stated from these publications." ], "confidence": { "level": "high", "unknowns": [ "The Division statute requires a benefit-report fee, but neither the FY2027 legislative approved-fee list nor current agency schedule names a separate benefit-report price. The report is uploaded in the ordinary renewal process; a distinct price cannot be truthfully stated from these publications." ] }, "sourceQualification": "", "effectiveNotes": [ "\u00a716-10b-107 reflects October 1, 2026 effectivity; \u00a7402 amended by 2026 ch.92. Current chapter PDF reviewed despite its older filename.", "Ordinary \u00a716-10a-841 was amended in 2025; older pre-amendment descriptions can be wrong.", "FY2027 fee authorization HB 8 \u00a73 applies July 1, 2026\u2013June 30, 2027; Governor signed March 26, 2026. Ordinary fee is independently verified beyond the agency PDF's older FY2026 heading." ], "region": "west", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Utah offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 16, 16 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Utah has an identified director monetary-protection provision in the compared scope, which earns this credit. \u00a716-10a-841, amended 2025, permits approved bylaws/resolution as well as articles. Officer extension concerns regulated banks/depository institutions and is not general officer protection.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Utah does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Utah requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 2, 2 ], "reason": "Identified company mission-failure monetary bar receives 2 points.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Utah earns the benefit-specific credit for company. Benefit director mandatory for publicly traded companies, optional for private companies; special benefit-director immunity excludes self-dealing, willful misconduct and knowing law violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Utah earns the benefit-specific credit for directors. Benefit director mandatory for publicly traded companies, optional for private companies; special benefit-director immunity excludes self-dealing, willful misconduct and knowing law violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Utah earns the benefit-specific credit for officers. Benefit director mandatory for publicly traded companies, optional for private companies; special benefit-director immunity excludes self-dealing, willful misconduct and knowing law violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 11, 11 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Utah: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Utah: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "State benefit filing required: no 4-point no-filing bonus.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Utah: State benefit-report filing. The extra filing removes the no-extra-filing credit; ordinary corporate reports are separate.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Utah has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 3, 9 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 3, 9 ], "reason": "Utah ordinary renewal is $18; a separate benefit price has a statute/schedule publication mismatch. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Utah\u2019s tax minimum is known, but the separately required benefit-report filing price remains a genuine statute/schedule mismatch. The cost score stays a range. Ordinary domestic C corporation, regular operating year, no Utah taxable profit and no special statutory exemption. Includes $100 annual minimum; registry fees and variable taxes excluded. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Model two-thirds class status protection, with statutory short-form transaction exceptions.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Utah: becoming a benefit company requires Two thirds of every class/series, including otherwise nonvoting shares; statutory short-form-merger exception. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Utah: changing back requires Same minimum status vote, with identified statutory merger exceptions. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Utah requires report access for people outside the company, so it earns public-access credit. Annual shareholder and public benefit report, plus upload/file with the division when renewing the normal business report.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Utah: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Utah: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Utah makes a mission duty mandatory, so it earns this credit. Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": null, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": null, "minimumTaxAnnualized": 100, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "State benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 64, 70 ], "tax": { "code": "UT", "incomeSummary": "Corporate franchise/income tax is 4.45% of Utah taxable income for tax years beginning January 1, 2026 or later, with a $100 minimum. The 2026 change replaces 4.5%; taxable income and multistate apportionment determine amounts above the minimum.", "recurringSummary": "Every ordinary C corporation incorporated, qualified or doing business in Utah must file TC-20 and pay at least $100, even when it does not exercise its right to do business.", "formationAnnualTaxFloor": 100, "floorBasis": "Ordinary nonexempt domestic C corporation under Utah's annual corporate franchise tax. $100 minimum, excluding registry fees and variable tax above the minimum.", "scenarioMinimum": 100, "scenarioBasis": "Ordinary domestic C corporation, regular operating year, no Utah taxable profit and no special statutory exemption. Includes $100 annual minimum; registry fees and variable taxes excluded.", "operatingTaxCaution": "Incorporation, qualification or doing-business nexus creates filing obligations. Multistate allocation/apportionment determines Utah taxable income; forming elsewhere does not remove Utah operating obligations.", "sources": [ { "label": "Utah current Code 59-7-104, effective January 1, 2026: 4.45% and $100", "url": "https://le.utah.gov/xcode/Title59/Chapter7/C59-7-S104_2026050620260506.html", "checked": "2026-10-11", "section": "Utah current Code 59-7-104, effective January 1, 2026: 4.45% and $100" }, { "label": "Utah current Code 59-7-201, effective January 1, 2026: corporate income tax", "url": "https://le.utah.gov/xcode/Title59/Chapter7/C59-7-S201_2026050620260506.html", "checked": "2026-10-11", "section": "Utah current Code 59-7-201, effective January 1, 2026: corporate income tax" }, { "label": "Utah Tax Commission, C-corporation filing and $100 privilege minimum", "url": "https://tax.utah.gov/business/corporate-income-tax/c-corp-tax/", "checked": "2026-10-11", "section": "Utah Tax Commission, C-corporation filing and $100 privilege minimum" } ] }, "conversion": { "state": "Utah", "code": "UT", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "Two thirds of every class/series, including otherwise nonvoting shares; statutory short-form-merger exception.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Model two-thirds class status protection, with statutory short-form transaction exceptions.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "id": "UT-benefit", "url": "https://le.utah.gov/xcode/Title16/Chapter10B/C16-10b_2014040320140513.pdf", "section": "Current \u00a7\u00a716-10b-103\u2013107,201,301\u2013305,401\u2013402", "claims": [ "Benefit purpose/duties, class vote, money shields, adjustable standing, independent assessment and division report" ] } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit is mandatory; a charter may add specific public benefits.", "difference": "Utah offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "\u00a716-10a-841, amended 2025, permits approved bylaws/resolution as well as articles. Officer extension concerns regulated banks/depository institutions and is not general officer protection. Benefit-specific rule: Benefit director mandatory for publicly traded companies, optional for private companies; special benefit-director immunity excludes self-dealing, willful misconduct and knowing law violation.", "difference": "Utah keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. 2025 ordinary exculpation can be adopted through approved bylaws/resolution." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder and public benefit report, plus upload/file with the division when renewing the normal business report. Assessment rule: Annual assessment against an independent third-party standard is required. Paid certification and a third-party audit are not required.", "difference": "Utah: Annual; Required outside framework; state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: Utah has an $18 renewal plus a legally required benefit-report fee whose separate price is absent from the published schedule. Minimum tax/license used here: $100. Ordinary domestic C corporation, regular operating year, no Utah taxable profit and no special statutory exemption. Includes $100 annual minimum; registry fees and variable taxes excluded.", "difference": "Utah\u2019s tax minimum is known, but the separately required benefit-report filing price remains a genuine statute/schedule mismatch. The cost score stays a range." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: Two thirds of every class/series, including otherwise nonvoting shares; statutory short-form-merger exception. Model two-thirds class status protection, with statutory short-form transaction exceptions. Changing back: Same minimum status vote, with identified statutory merger exceptions.", "difference": "Utah entry uses Two thirds of every class/series, including otherwise nonvoting shares; statutory short-form-merger exception.; exit uses Same minimum status vote, with identified statutory merger exceptions.. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors must consider enumerated shareholders, workers, customers, community, environment, long-term interests and benefit purposes; no automatic priority, subject to permitted charter priorities. Disclosure: Annual shareholder and public benefit report, plus upload/file with the division when renewing the normal business report. Enforcement: Unlike ordinary model defaults, \u00a716-10b-305(3)(b) permits charter increases to derivative ownership requirements.", "difference": "Utah requires public access to the report. Articles can increase derivative benefit enforcement ownership requirements. State benefit report is required at renewal. Ordinary FY2027 renewal is $18; statutory separate-fee language and absence of a published benefit-report line item must be disclosed as a source discrepancy." } } }, "guideUrl": "/assets/state-guides/UT.md" }, { "state": "Vermont", "abbreviation": "VT", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / shareholder-approved-report model", "features": { "purpose": { "summary": "General public benefit required; specific charter benefits optional.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "11A \u00a721.08" } ] }, "board": { "summary": "Mandatory stakeholder consideration. Independent benefit director generally required; boardless replacement need not be independent unless annual gross revenue \u2265$5m in each of preceding two years.", "mode": "mandatory_consider", "benefitDirectorRequired": "all; boardless independence exception below $5m", "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.09-21.10" } ] }, "standard": { "summary": "Annual assessment against third-party standard required. No mandatory external certification; benefit director may commission a voluntary audit.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.10(c)(2),21.14(a)(2)" } ] }, "report": { "summary": "Annual to shareholders by earlier of 120 days or other annual report. Shareholders must approve/reject by majority vote; next-year goals are shareholder approved. Latest endorsed report public online or free on request. No state benefit-report filing.", "cadence": "annual", "shareholders": true, "publicWebsite": "most recent shareholder-endorsed report", "stateFiling": false, "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a721.14" } ], "public": true }, "enforcement": { "summary": "Otherwise eligible derivative shareholder, director, 10% parent equity, and charter designees; the special statutory list does not expressly list the corporation itself. No special direct-company ownership percentage.", "shareholderThreshold": "otherwise eligible derivative shareholder", "directorStanding": true, "parentThreshold": "10% of parent equity", "otherStanding": "charter designees", "corporationStanding": false, "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a721.13" } ] }, "benefitLiability": { "summary": "Directors/officers receive compliant-conduct and mission-failure protection; no express corporation mission-damages bar identified. Benefit-director exceptions bad faith, intentional misconduct/knowing violations and improper benefit.", "corporationMissionDamagesBar": false, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true, "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.09(c)-(d),21.10(f),21.11(c)-(d)" } ] }, "ordinaryExculpation": { "summary": "Ordinary charter director protection excludes unentitled financial benefit, intentional OR reckless harm, unlawful distributions, and intentional OR reckless criminal acts. Benefit-corporation \u00a721.11(f) separately permits officer charter exculpation, with financial-benefit/harm/criminal exceptions.", "director": true, "officer": true, "automatic": false, "officerScope": "benefit corporations under \u00a721.11(f)", "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/002", "section": "\u00a72.02(b)(4); \u00a721.11(f)" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a721.11(f)" } ] }, "statusChange": { "summary": "Entry/exit requires higher charter vote or two-thirds of entitled outstanding votes and each separately entitled voting group. Does not automatically enfranchise all otherwise nonvoting classes.", "entryVote": "two-thirds of entitled votes and entitled voting groups", "exitVote": "two-thirds of entitled votes and entitled voting groups", "optionalLock": false, "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.04-21.08" } ] } }, "costs": { "regularReport": { "amount": 60, "currency": "USD", "cadence": "annual", "conditions": "Domestic business-corporation annual report.", "summary": "Domestic business-corporation annual report.", "sources": [ { "url": "https://sos.vermont.gov/business-services/fees-statutes", "section": "domestic business corporation annual report" } ] }, "benefitReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No state benefit-report filing.", "summary": "No state benefit-report filing.", "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a721.14" } ] }, "minimumTax": { "amount": 100, "currency": "USD", "cadence": "annual", "conditions": "Active C corporation with VT gross receipts <$500k. Higher tiers $500/$2,000/$6,000/$100,000; inactive return with no activity/tax liability may owe $0. S/pass-through and farm rules differ.", "summary": "Active C corporation with VT gross receipts <$500k. Higher tiers $500/$2,000/$6,000/$100,000; inactive return with no activity/tax liability may owe $0. S/pass-through and farm rules differ.", "sources": [ { "url": "https://tax.vermont.gov/business/corporate-income-tax", "section": "minimum annual tax" }, { "label": "Vermont Department of Taxes: corporate rates, receipt minima and inactive returns", "url": "https://tax.vermont.gov/business/corporate-income-tax", "checked": "2026-10-11", "section": "Vermont Department of Taxes: corporate rates, receipt minima and inactive returns" }, { "label": "Vermont statute: section 5832 corporate rates and current minimum tiers", "url": "https://legislature.vermont.gov/statutes/section/32/151/05832", "checked": "2026-10-11", "section": "Vermont statute: section 5832 corporate rates and current minimum tiers" }, { "label": "Vermont Department of Taxes: market-sourcing legislative changes", "url": "https://tax.vermont.gov/research-and-reports/legislative-updates/2019", "checked": "2026-10-11", "section": "Vermont Department of Taxes: market-sourcing legislative changes" } ] } }, "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "11A \u00a721.08" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.09-21.10" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.10(c)(2),21.14(a)(2)" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a721.14" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a721.13" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.09(c)-(d),21.10(f),21.11(c)-(d)" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/002", "section": "\u00a72.02(b)(4); \u00a721.11(f)" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a721.11(f)" }, { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.04-21.08" }, { "url": "https://sos.vermont.gov/business-services/fees-statutes", "section": "domestic business corporation annual report" }, { "url": "https://tax.vermont.gov/business/corporate-income-tax", "section": "minimum annual tax" }, { "label": "Vermont Department of Taxes: corporate rates, receipt minima and inactive returns", "url": "https://tax.vermont.gov/business/corporate-income-tax", "checked": "2026-10-11", "section": "Vermont Department of Taxes: corporate rates, receipt minima and inactive returns" }, { "label": "Vermont statute: section 5832 corporate rates and current minimum tiers", "url": "https://legislature.vermont.gov/statutes/section/32/151/05832", "checked": "2026-10-11", "section": "Vermont statute: section 5832 corporate rates and current minimum tiers" }, { "label": "Vermont Department of Taxes: market-sourcing legislative changes", "url": "https://tax.vermont.gov/research-and-reports/legislative-updates/2019", "checked": "2026-10-11", "section": "Vermont Department of Taxes: market-sourcing legislative changes" } ], "differences": [ "Annual benefit report is voted on by shareholders; mission goals also require approval.", "Reckless harm/criminal acts remain outside ordinary charter protection.", "Officer charter exculpation is specifically provided for benefit corporations.", "Special benefit-enforcement standing list omits an express corporation-direct action." ], "gaps": [ "Entity-specific tax and boardless-corporation independence qualifications not modeled beyond statutory thresholds." ], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Vermont offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Vermont has an identified director monetary-protection provision in the compared scope, which earns this credit. Ordinary charter director protection excludes unentitled financial benefit, intentional OR reckless harm, unlawful distributions, and intentional OR reckless criminal acts. Benefit-corporation \u00a721.11(f) separately permits officer charter exculpation, with financial-benefit/harm/criminal exceptions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Vermont extends ordinary protection to officers, which earns officer-scope credit. Ordinary charter director protection excludes unentitled financial benefit, intentional OR reckless harm, unlawful distributions, and intentional OR reckless criminal acts. Benefit-corporation \u00a721.11(f) separately permits officer charter exculpation, with financial-benefit/harm/criminal exceptions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Vermont requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Vermont has no separately credited benefit-specific monetary shield for company. Directors/officers receive compliant-conduct and mission-failure protection; no express corporation mission-damages bar identified. Benefit-director exceptions bad faith, intentional misconduct/knowing violations and improper benefit.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Vermont earns the benefit-specific credit for directors. Directors/officers receive compliant-conduct and mission-failure protection; no express corporation mission-damages bar identified. Benefit-director exceptions bad faith, intentional misconduct/knowing violations and improper benefit.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Vermont earns the benefit-specific credit for officers. Directors/officers receive compliant-conduct and mission-failure protection; no express corporation mission-damages bar identified. Benefit-director exceptions bad faith, intentional misconduct/knowing violations and improper benefit.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 12, 12 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Vermont: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Vermont: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Vermont: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "Mandatory benefit director or report-approval procedure in this private-company scope: no 3-point flexibility bonus.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Vermont requires an additional benefit-director or report-approval procedure in this private-company scope, so it receives no no-extra-step credit. Mandatory stakeholder consideration. Independent benefit director generally required; boardless replacement need not be independent unless annual gross revenue \u2265$5m in each of preceding two years.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 9, 9 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 9, 9 ], "reason": "Ordinary reporting $60 + benefit filing $0 = $60 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Vermont has a compared recurring floor of $160 per year, including $100 in identified minimum tax/license charges. Small active ordinary domestic C corporation in a regular full year, Vermont gross receipts below $500,000, no taxable profit and no small-farm or other special classification. Annual registry and benefit-report fees are separate. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry/exit requires higher charter vote or two-thirds of entitled outstanding votes and each separately entitled voting group. Does not automatically enfranchise all otherwise nonvoting classes.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Vermont: becoming a benefit company requires two-thirds of entitled votes and entitled voting groups. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Vermont: changing back requires two-thirds of entitled votes and entitled voting groups. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Vermont requires report access for people outside the company, so it earns public-access credit. Annual to shareholders by earlier of 120 days or other annual report. Shareholders must approve/reject by majority vote; next-year goals are shareholder approved. Latest endorsed report public online or free on request. No state benefit-report filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Vermont: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Vermont: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Vermont makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration. Independent benefit director generally required; boardless replacement need not be independent unless annual gross revenue \u2265$5m in each of preceding two years.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 60, "ordinaryScope": { "director": true, "officer": true, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": true, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 160, "minimumTaxAnnualized": 100, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 75, 75 ], "tax": { "code": "VT", "incomeSummary": "Vermont corporate income tax uses marginal rates of 6% through $10,000 of Vermont taxable income, 7% above $10,000 through $25,000, and 8.5% above $25,000, subject to an active-corporation minimum determined by Vermont gross receipts.", "recurringSummary": "For an ordinary active C corporation, the lowest annual minimum is $100 in the lowest Vermont-receipts tier; higher tiers are $500, $2,000, $6,000 and $100,000. An inactive return with no activity or tax liability can have no tax due. Small farm corporations have a separate $75 exception, and pass-through entities follow a different regime.", "formationAnnualTaxFloor": null, "floorBasis": "The $100 minimum is an active-C-corporation rule rather than an unconditional tax on mere domestic status; the department expressly allows a no-tax inactive return. Excludes registry/benefit reporting, higher receipts, special farm/pass-through rules and other operating taxes.", "scenarioMinimum": 100, "scenarioBasis": "Small active ordinary domestic C corporation in a regular full year, Vermont gross receipts below $500,000, no taxable profit and no small-farm or other special classification. Annual registry and benefit-report fees are separate.", "operatingTaxCaution": "The department requires returns for Vermont incorporation, income allocated/apportioned to Vermont or an open corporate account. Services and intangible sales follow Vermont-market sourcing under the documented 2019 change. An inactive filing exception must not be used for an active operating-company comparison.", "sources": [ { "label": "Vermont Department of Taxes: corporate rates, receipt minima and inactive returns", "url": "https://tax.vermont.gov/business/corporate-income-tax", "checked": "2026-10-11", "section": "Vermont Department of Taxes: corporate rates, receipt minima and inactive returns" }, { "label": "Vermont statute: section 5832 corporate rates and current minimum tiers", "url": "https://legislature.vermont.gov/statutes/section/32/151/05832", "checked": "2026-10-11", "section": "Vermont statute: section 5832 corporate rates and current minimum tiers" }, { "label": "Vermont Department of Taxes: market-sourcing legislative changes", "url": "https://tax.vermont.gov/research-and-reports/legislative-updates/2019", "checked": "2026-10-11", "section": "Vermont Department of Taxes: market-sourcing legislative changes" } ] }, "conversion": { "state": "Vermont", "code": "VT", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "two-thirds of entitled votes and entitled voting groups", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry/exit requires higher charter vote or two-thirds of entitled outstanding votes and each separately entitled voting group. Does not automatically enfranchise all otherwise nonvoting classes.", "proposal": "Remove the benefit-only entry supermajority in favor of ordinary amendment rules; assess status-only appraisal costs and choose exit protection separately.", "sources": [ { "url": "https://legislature.vermont.gov/statutes/fullchapter/11A/021", "section": "\u00a7\u00a721.04-21.08" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required; specific charter benefits optional.", "difference": "Vermont offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Ordinary charter director protection excludes unentitled financial benefit, intentional OR reckless harm, unlawful distributions, and intentional OR reckless criminal acts. Benefit-corporation \u00a721.11(f) separately permits officer charter exculpation, with financial-benefit/harm/criminal exceptions. Benefit-specific rule: Directors/officers receive compliant-conduct and mission-failure protection; no express corporation mission-damages bar identified. Benefit-director exceptions bad faith, intentional misconduct/knowing violations and improper benefit.", "difference": "Vermont adds ordinary officer coverage; the charter must elect the ordinary protection. Reckless harm/criminal acts remain outside ordinary charter protection. Officer charter exculpation is specifically provided for benefit corporations." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders by earlier of 120 days or other annual report. Shareholders must approve/reject by majority vote; next-year goals are shareholder approved. Latest endorsed report public online or free on request. No state benefit-report filing. Assessment rule: Annual assessment against third-party standard required. No mandatory external certification; benefit director may commission a voluntary audit.", "difference": "Vermont: Annual; Required outside framework; no separate state benefit-report filing. An additional benefit-director or approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $60 per year on an annualized basis. Minimum tax/license used here: $100. Small active ordinary domestic C corporation in a regular full year, Vermont gross receipts below $500,000, no taxable profit and no small-farm or other special classification. Annual registry and benefit-report fees are separate.", "difference": "Vermont has a compared recurring floor of $160 per year, including $100 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: two-thirds of entitled votes and entitled voting groups. Entry/exit requires higher charter vote or two-thirds of entitled outstanding votes and each separately entitled voting group. Does not automatically enfranchise all otherwise nonvoting classes. Changing back: two-thirds of entitled votes and entitled voting groups", "difference": "Vermont entry uses two-thirds of entitled votes and entitled voting groups; exit uses two-thirds of entitled votes and entitled voting groups. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration. Independent benefit director generally required; boardless replacement need not be independent unless annual gross revenue \u2265$5m in each of preceding two years. Disclosure: Annual to shareholders by earlier of 120 days or other annual report. Shareholders must approve/reject by majority vote; next-year goals are shareholder approved. Latest endorsed report public online or free on request. No state benefit-report filing. Enforcement: Otherwise eligible derivative shareholder, director, 10% parent equity, and charter designees; the special statutory list does not expressly list the corporation itself. No special direct-company ownership percentage.", "difference": "Vermont requires public access to the report. Annual benefit report is voted on by shareholders; mission goals also require approval. Special benefit-enforcement standing list omits an express corporation-direct action." } } }, "guideUrl": "/assets/state-guides/VT.md" }, { "state": "Virginia", "abbreviation": "VA", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit / unanimous-entry model", "features": { "purpose": { "summary": "General benefit required; specific benefit optional and can be set in charter, bylaws or by board action.", "generalRequired": true, "specificRequired": false, "specificOptional": true, "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-787" } ] }, "board": { "summary": "Mandatory stakeholder consideration; charter may prioritize specified benefit. No independent benefit director requirement.", "mode": "mandatory_consider", "benefitDirectorRequired": "none", "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-788" } ] }, "standard": { "summary": "Annual third-party standard assessment required. No mandatory third-party audit/certification in article.", "thirdPartyRequired": true, "certificationRequired": false, "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-791(A)(2)" } ] }, "report": { "summary": "Annual to shareholders by earlier of 120 days or other annual report. Latest report public online or written/electronic copy on request without website; confidentiality omissions only to extent standard permits. No state benefit filing.", "cadence": "annual", "shareholders": true, "publicWebsite": "most recent report", "stateFiling": false, "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-791" } ], "public": true }, "enforcement": { "summary": "Corporation; any shareholder, director, charter/bylaw designees. No automatic parent-equity standing in article.", "shareholderThreshold": "any shareholder subject to derivative procedure", "directorStanding": true, "parentThreshold": null, "otherStanding": "charter/bylaw designees", "corporationStanding": true, "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-790" } ] }, "benefitLiability": { "summary": "Directors protected against corporation/shareholder monetary claims for compliant duties or mission failure. Officers protected for actions believed in good-faith business judgment consistent with mission AND third-party standard. No express corporation mission-damages bar.", "corporationMissionDamagesBar": false, "directorMissionDamagesBar": true, "officerMissionDamagesBar": false, "officerProtection": "good-faith business-judgment safe harbor, not unconditional mission-failure bar", "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a7\u00a713.1-788(C),789" } ] }, "ordinaryExculpation": { "summary": "Directors AND officers have statutory damages cap for corporation/shareholder claims per transaction: greater of $100k or prior-year cash compensation, reducible to zero by charter/shareholder-approved bylaw. Exceptions wilful misconduct, knowing criminal violation, federal/state securities violation.", "director": true, "officer": true, "automatic": true, "sources": [ { "url": "https://law.lis.virginia.gov/vacode/title13.1/chapter9/section13.1-692.1/", "section": "\u00a713.1-692.1" } ] }, "statusChange": { "summary": "Conversion after formation requires ALL shareholders entitled to vote. Exit uses ordinary amendment rule: >two-thirds each entitled voting group by default; charter may lower to majority of votes cast with quorum.", "entryVote": "unanimous entitled voting shareholders", "exitVote": "ordinary amendment rule; >two-thirds default, reducible by charter", "optionalLock": false, "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a7\u00a713.1-785,-786;13.1-707(D)" }, { "url": "https://law.lis.virginia.gov/vacode/title13.1/chapter9/section13.1-707/", "section": "\u00a713.1-707(D)" } ] } }, "costs": { "regularReport": { "amount": 100, "currency": "USD", "cadence": "annual", "conditions": "Annual REGISTRATION fee at 1\u20135,000 authorized shares; higher authorized shares increase fee. Annual report itself has no filing fee.", "summary": "Annual REGISTRATION fee at 1\u20135,000 authorized shares; higher authorized shares increase fee. Annual report itself has no filing fee.", "sources": [ { "url": "https://www.scc.virginia.gov/media/sccvirginiagov-home/business-home/business-faqs/annual-registration-fees/an_fee.pdf", "section": "Annual Corporation Requirements and Fee Schedule" } ] }, "benefitReport": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "No state benefit-report filing.", "summary": "No state benefit-report filing.", "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-791" } ] }, "minimumTax": { "amount": 0, "currency": "USD", "cadence": "annual", "conditions": "Ordinary corporation income tax is 6% of Virginia taxable income, so this income-tax amount can be $0 when that taxable income is $0; the cited formula has no fixed dollar income-tax floor. Every Virginia-incorporated corporation, SCC-registered corporation, or corporation receiving Virginia-source income must file Form 500, subject to applicable exceptions. Multistate companies allocate and apportion income. Federally elected S corporations file as pass-through entities on Form 502 instead. The SCC annual registration fee is separate and still starts at $100 for 1\u20135,000 authorized shares; local business-license and other taxes can also apply.", "basis": "Conditional $0 corporate-income-tax scenario; the SCC annual registration fee is separately counted.", "summary": "Ordinary corporation income tax is 6% of Virginia taxable income, so this income-tax amount can be $0 when that taxable income is $0; the cited formula has no fixed dollar income-tax floor. Every Virginia-incorporated corporation, SCC-registered corporation, or corporation receiving Virginia-source income must file Form 500, subject to applicable exceptions. Multistate companies allocate and apportion income. Federally elected S corporations file as pass-through entities on Form 502 instead. The SCC annual registration fee is separate and still starts at $100 for 1\u20135,000 authorized shares; local business-license and other taxes can also apply.", "sources": [ { "url": "https://www.tax.virginia.gov/corporation-income-tax", "section": "General Filing Requirements; 6% rate; domestic/foreign and S-corporation filing" }, { "url": "https://law.lis.virginia.gov/vacode/title58.1/chapter3/section58.1-400/", "section": "Va. Code \u00a758.1-400: 6% of Virginia taxable income" }, { "label": "Virginia Tax: corporation rate, annual filing and multistate rules", "url": "https://www.tax.virginia.gov/corporation-income-tax", "checked": "2026-10-11", "section": "Virginia Tax: corporation rate, annual filing and multistate rules" }, { "label": "Virginia statute: section 58.1-400 income-based corporate tax formula", "url": "https://law.lis.virginia.gov/vacode/title58.1/chapter3/section58.1-400/", "checked": "2026-10-11", "section": "Virginia statute: section 58.1-400 income-based corporate tax formula" }, { "label": "Virginia SCC: annual stock-corporation share-based registration fee", "url": "https://www.scc.virginia.gov/media/sccvirginiagov-home/business-home/business-faqs/annual-registration-fees/an_fee.pdf", "checked": "2026-10-11", "section": "Virginia SCC: annual stock-corporation share-based registration fee" } ] } }, "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-787" }, { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-788" }, { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-791(A)(2)" }, { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-791" }, { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a713.1-790" }, { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a7\u00a713.1-788(C),789" }, { "url": "https://law.lis.virginia.gov/vacode/title13.1/chapter9/section13.1-692.1/", "section": "\u00a713.1-692.1" }, { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a7\u00a713.1-785,-786;13.1-707(D)" }, { "url": "https://law.lis.virginia.gov/vacode/title13.1/chapter9/section13.1-707/", "section": "\u00a713.1-707(D)" }, { "url": "https://www.scc.virginia.gov/media/sccvirginiagov-home/business-home/business-faqs/annual-registration-fees/an_fee.pdf", "section": "Annual Corporation Requirements and Fee Schedule" }, { "url": "https://www.tax.virginia.gov/corporation-income-tax", "section": "General Filing Requirements; 6% rate; domestic/foreign and S-corporation filing" }, { "url": "https://law.lis.virginia.gov/vacode/title58.1/chapter3/section58.1-400/", "section": "Va. Code \u00a758.1-400: 6% of Virginia taxable income" }, { "label": "Virginia Tax: corporation rate, annual filing and multistate rules", "url": "https://www.tax.virginia.gov/corporation-income-tax", "checked": "2026-10-11", "section": "Virginia Tax: corporation rate, annual filing and multistate rules" }, { "label": "Virginia statute: section 58.1-400 income-based corporate tax formula", "url": "https://law.lis.virginia.gov/vacode/title58.1/chapter3/section58.1-400/", "checked": "2026-10-11", "section": "Virginia statute: section 58.1-400 income-based corporate tax formula" }, { "label": "Virginia SCC: annual stock-corporation share-based registration fee", "url": "https://www.scc.virginia.gov/media/sccvirginiagov-home/business-home/business-faqs/annual-registration-fees/an_fee.pdf", "checked": "2026-10-11", "section": "Virginia SCC: annual stock-corporation share-based registration fee" } ], "differences": [ "Unanimous conversion-in vote; easier ordinary-amendment route out.", "Automatic director/officer statutory cap, with charter option for zero, is distinct from mandatory charter adoption in most states.", "Specific benefit can be set by board/bylaw; officer safe harbor depends on the third-party standard." ], "gaps": [ "Virginia ordinary exculpation is limited to corporation/shareholder claims; it does not supply a general regulatory or third-party shield." ], "confidence": "Primary statutory provisions reviewed; implementation and tax qualifications are separately identified.", "sourceQualification": "", "effectiveNotes": [], "region": "east", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Virginia offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 19, 19 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Virginia has an identified director monetary-protection provision in the compared scope, which earns this credit. Directors AND officers have statutory damages cap for corporation/shareholder claims per transaction: greater of $100k or prior-year cash compensation, reducible to zero by charter/shareholder-approved bylaw. Exceptions wilful misconduct, knowing criminal violation, federal/state securities violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 6, 6 ], "reason": "Identified officer scope receives 6 points. This does not equate its exceptions with other states.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Virginia extends ordinary protection to officers, which earns officer-scope credit. Directors AND officers have statutory damages cap for corporation/shareholder claims per transaction: greater of $100k or prior-year cash compensation, reducible to zero by charter/shareholder-approved bylaw. Exceptions wilful misconduct, knowing criminal violation, federal/state securities violation.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 3, 3 ], "reason": "Statutory coverage in the selected scope receives the 3-point default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Virginia has a default statutory liability rule in the compared scope, so it earns the automatic-coverage credit. Articles and retained exceptions still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Virginia has no separately credited benefit-specific monetary shield for company. Directors protected against corporation/shareholder monetary claims for compliant duties or mission failure. Officers protected for actions believed in good-faith business judgment consistent with mission AND third-party standard. No express corporation mission-damages bar.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Virginia earns the benefit-specific credit for directors. Directors protected against corporation/shareholder monetary claims for compliant duties or mission failure. Officers protected for actions believed in good-faith business judgment consistent with mission AND third-party standard. No express corporation mission-damages bar.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Virginia has no separately credited benefit-specific monetary shield for officers. Directors protected against corporation/shareholder monetary claims for compliant duties or mission failure. Officers protected for actions believed in good-faith business judgment consistent with mission AND third-party standard. No express corporation mission-damages bar.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Virginia: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Virginia: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Virginia: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Virginia has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $100 + benefit filing $0 = $100 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Virginia has a compared recurring floor of $100 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation in a regular full year with no Virginia taxable profit after modifications and apportionment. The SCC annual registration fee and local operating taxes remain separate. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 6, 6 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Conversion after formation requires ALL shareholders entitled to vote. Exit uses ordinary amendment rule: >two-thirds each entitled voting group by default; charter may lower to majority of votes cast with quorum.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Virginia: becoming a benefit company requires unanimous entitled voting shareholders. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Conversion after formation requires ALL shareholders entitled to vote. Exit uses ordinary amendment rule: >two-thirds each entitled voting group by default; charter may lower to majority of votes cast with quorum.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Virginia: changing back requires ordinary amendment rule; >two-thirds default, reducible by charter. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain. Conversion after formation requires ALL shareholders entitled to vote. Exit uses ordinary amendment rule: >two-thirds each entitled voting group by default; charter may lower to majority of votes cast with quorum.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Virginia requires report access for people outside the company, so it earns public-access credit. Annual to shareholders by earlier of 120 days or other annual report. Latest report public online or written/electronic copy on request without website; confidentiality omissions only to extent standard permits. No state benefit filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Virginia: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Virginia: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Virginia makes a mission duty mandatory, so it earns this credit. Mandatory stakeholder consideration; charter may prioritize specified benefit. No independent benefit director requirement.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 100, "ordinaryScope": { "director": true, "officer": true, "automatic": true }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 100, "minimumTaxAnnualized": 0, "entryCategory": "unanimous" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director and officer scope", "exit": "Two-thirds default" }, "scoreRange": [ 76, 76 ], "tax": { "code": "VA", "incomeSummary": "Virginia corporation income tax is 6% of Virginia taxable income. Multistate corporations allocate/apportion using Virginia Schedule A. Federally elected S corporations generally use Virginia's pass-through regime instead of this ordinary C-corporation calculation.", "recurringSummary": "There is no fixed-dollar minimum in the ordinary corporate-income formula. The SCC annual stock-corporation registration fee is separate and starts at $100 for 1\u20135,000 authorized shares, increasing with shares. Local business-license taxes and property, sales and payroll taxes may also apply.", "formationAnnualTaxFloor": null, "floorBasis": "No fixed income/franchise-tax floor identified solely from ordinary domestic status; $0 income tax requires no Virginia taxable income. The SCC share-based registration fee is already a registry charge and must not be counted twice as tax.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation in a regular full year with no Virginia taxable profit after modifications and apportionment. The SCC annual registration fee and local operating taxes remain separate.", "operatingTaxCaution": "Virginia Tax requires domestic and SCC-registered corporations to file annually even with no income; other foreign corporations file when they have Virginia-source income. Schedule A and applicable nexus/P.L. 86-272 rulings determine multistate liability, not the incorporation address alone.", "sources": [ { "label": "Virginia Tax: corporation rate, annual filing and multistate rules", "url": "https://www.tax.virginia.gov/corporation-income-tax", "checked": "2026-10-11", "section": "Virginia Tax: corporation rate, annual filing and multistate rules" }, { "label": "Virginia statute: section 58.1-400 income-based corporate tax formula", "url": "https://law.lis.virginia.gov/vacode/title58.1/chapter3/section58.1-400/", "checked": "2026-10-11", "section": "Virginia statute: section 58.1-400 income-based corporate tax formula" }, { "label": "Virginia SCC: annual stock-corporation share-based registration fee", "url": "https://www.scc.virginia.gov/media/sccvirginiagov-home/business-home/business-faqs/annual-registration-fees/an_fee.pdf", "checked": "2026-10-11", "section": "Virginia SCC: annual stock-corporation share-based registration fee" } ] }, "conversion": { "state": "Virginia", "code": "VA", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "unanimous entitled voting shareholders", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Conversion after formation requires ALL shareholders entitled to vote. Exit uses ordinary amendment rule: >two-thirds each entitled voting group by default; charter may lower to majority of votes cast with quorum.", "proposal": "Replace the unanimous entitled-shareholder entry gate with ordinary amendment requirements; keep exit voting and acquired rights distinct.", "sources": [ { "url": "https://law.lis.virginia.gov/vacodefull/title13.1/chapter9/article22/", "section": "\u00a7\u00a713.1-785,-786;13.1-707(D)" }, { "url": "https://law.lis.virginia.gov/vacode/title13.1/chapter9/section13.1-707/", "section": "\u00a713.1-707(D)" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General benefit required; specific benefit optional and can be set in charter, bylaws or by board action.", "difference": "Virginia offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Directors AND officers have statutory damages cap for corporation/shareholder claims per transaction: greater of $100k or prior-year cash compensation, reducible to zero by charter/shareholder-approved bylaw. Exceptions wilful misconduct, knowing criminal violation, federal/state securities violation. Benefit-specific rule: Directors protected against corporation/shareholder monetary claims for compliant duties or mission failure. Officers protected for actions believed in good-faith business judgment consistent with mission AND third-party standard. No express corporation mission-damages bar.", "difference": "Virginia adds ordinary officer coverage and a default statutory liability rule. Automatic director/officer statutory cap, with charter option for zero, is distinct from mandatory charter adoption in most states. Specific benefit can be set by board/bylaw; officer safe harbor depends on the third-party standard." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual to shareholders by earlier of 120 days or other annual report. Latest report public online or written/electronic copy on request without website; confidentiality omissions only to extent standard permits. No state benefit filing. Assessment rule: Annual third-party standard assessment required. No mandatory third-party audit/certification in article.", "difference": "Virginia: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $100 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation in a regular full year with no Virginia taxable profit after modifications and apportionment. The SCC annual registration fee and local operating taxes remain separate.", "difference": "Virginia has a compared recurring floor of $100 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: unanimous entitled voting shareholders. Conversion after formation requires ALL shareholders entitled to vote. Exit uses ordinary amendment rule: >two-thirds each entitled voting group by default; charter may lower to majority of votes cast with quorum. Changing back: ordinary amendment rule; >two-thirds default, reducible by charter", "difference": "Virginia entry uses unanimous entitled voting shareholders; exit uses ordinary amendment rule; >two-thirds default, reducible by charter. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Mandatory stakeholder consideration; charter may prioritize specified benefit. No independent benefit director requirement. Disclosure: Annual to shareholders by earlier of 120 days or other annual report. Latest report public online or written/electronic copy on request without website; confidentiality omissions only to extent standard permits. No state benefit filing. Enforcement: Corporation; any shareholder, director, charter/bylaw designees. No automatic parent-equity standing in article.", "difference": "Virginia requires public access to the report. " } } }, "guideUrl": "/assets/state-guides/VA.md" }, { "state": "Washington", "abbreviation": "WA", "form": "Social purpose corporation", "status": "Related", "reviewed": "2026-10-11", "family": "social-purpose permission", "features": { "purpose": { "summary": "Related social purpose corporation: general positive effects on selected stakeholder categories; specific social purposes optional.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.020" } ], "generalRequired": true, "specificRequired": false, "specificOptional": true }, "board": { "summary": "Directors may consider and give weight to social purposes unless articles require more. Promotion of purpose is deemed in the corporation\u2019s best interests.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.050" } ], "mode": "permissive_social_purpose" }, "standard": { "summary": "No mandatory third-party assessment standard identified; companies can elect one.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.150" } ], "thirdPartyRequired": false, "certificationRequired": false }, "report": { "summary": "Annual public website report within four months of year end. After two consecutive missed fiscal years, a shareholder may seek a summary reporting order.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.150" } ], "cadence": "annual", "shareholders": false, "publicWebsite": true, "stateFiling": false, "public": true }, "enforcement": { "summary": "Only shareholders bring purpose-duty actions in the corporation\u2019s right. Ordinary derivative procedure and contemporaneous ownership apply; no special percentage threshold.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.080" } ], "shareholderThreshold": "Any qualifying shareholder; ordinary derivative rules" }, "benefitLiability": { "summary": "Director and officer purpose-duty liability bars depend on compliance with good faith, care and best-interest standards. Not a bar to unrelated duties.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.050\u2013060" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": true, "officerMissionDamagesBar": true }, "ordinaryExculpation": { "summary": "Director-only opt-in charter monetary limitation; exceptions include intentional misconduct, knowing law violation, unlawful distributions and improper personal benefit.", "sources": [ { "url": "https://app.leg.wa.gov/RCW/default.aspx?cite=23B.08.320", "section": "\u00a723B.08.320" } ], "director": true, "officer": false, "automatic": false }, "statusChange": { "summary": "Two thirds of each class and overall entitled shares for material purpose change or termination; higher articles requirements may apply.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.090\u2013110" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23B.25.130", "section": "RCW 23B.25.130 \u2014 election" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23B.25.120", "section": "RCW 23B.25.120 \u2014 dissent" } ], "entryVote": "2/3 each class", "exitVote": "2/3 each class", "optionalLock": false } }, "costs": { "regularReport": { "amount": 70, "cadence": "annual", "conditions": "Current standard annual report fee; older $60 materials are stale.", "summary": "Current standard annual report fee; older $60 materials are stale.", "sources": [ { "url": "https://www.sos.wa.gov/corporations-charities/frequently-asked-questions-faqs/fee-schedules-priority-services", "section": "Annual reports" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "Website report, no dedicated state filing identified.", "summary": "Website report, no dedicated state filing identified.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.150" } ] }, "minimumTax": { "amount": null, "conditions": "Washington B&O tax applies to gross business income by activity classification; expenses generally are not deductible. The small-business credit can reduce liability. Software, technology and educational services can have different classifications, so revenue and services determine the amount rather than a universal incorporation minimum.", "summary": "Washington B&O tax applies to gross business income by activity classification; expenses generally are not deductible. The small-business credit can reduce liability. Software, technology and educational services can have different classifications, so revenue and services determine the amount rather than a universal incorporation minimum.", "sources": [ { "url": "https://dor.wa.gov/taxes-rates/business-occupation-tax", "section": "Gross-receipts B&O tax and classifications" }, { "label": "Washington DOR, forms/publications: no corporate income tax", "url": "https://dor.wa.gov/forms-publications", "checked": "2026-10-11", "section": "Washington DOR, forms/publications: no corporate income tax" }, { "label": "Washington DOR, B&O tax: gross receipts and no expense deduction", "url": "https://dor.wa.gov/taxes-rates/business-occupation-tax", "checked": "2026-10-11", "section": "Washington DOR, B&O tax: gross receipts and no expense deduction" }, { "label": "Washington DOR, current B&O classifications and rates", "url": "https://dor.wa.gov/taxes-rates/business-occupation-tax/business-occupation-tax-classifications", "checked": "2026-10-11", "section": "Washington DOR, current B&O classifications and rates" }, { "label": "Washington DOR, small-business B&O credit: maximum monthly credit by classification", "url": "https://dor.wa.gov/forms-publications/publications-subject/special-notices/business-and-occupation-tax-credit-increase-small-businesses", "checked": "2026-10-11", "section": "Washington DOR, small-business B&O credit: maximum monthly credit by classification" } ] } }, "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.020" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.050" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.150" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.080" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.050\u2013060" }, { "url": "https://app.leg.wa.gov/RCW/default.aspx?cite=23B.08.320", "section": "\u00a723B.08.320" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23b.25&full=true", "section": "\u00a723B.25.090\u2013110" }, { "url": "https://www.sos.wa.gov/corporations-charities/frequently-asked-questions-faqs/fee-schedules-priority-services", "section": "Annual reports" }, { "url": "https://dor.wa.gov/taxes-rates/business-occupation-tax", "section": "Gross-receipts B&O tax and classifications" }, { "label": "Washington DOR, forms/publications: no corporate income tax", "url": "https://dor.wa.gov/forms-publications", "checked": "2026-10-11", "section": "Washington DOR, forms/publications: no corporate income tax" }, { "label": "Washington DOR, B&O tax: gross receipts and no expense deduction", "url": "https://dor.wa.gov/taxes-rates/business-occupation-tax", "checked": "2026-10-11", "section": "Washington DOR, B&O tax: gross receipts and no expense deduction" }, { "label": "Washington DOR, current B&O classifications and rates", "url": "https://dor.wa.gov/taxes-rates/business-occupation-tax/business-occupation-tax-classifications", "checked": "2026-10-11", "section": "Washington DOR, current B&O classifications and rates" }, { "label": "Washington DOR, small-business B&O credit: maximum monthly credit by classification", "url": "https://dor.wa.gov/forms-publications/publications-subject/special-notices/business-and-occupation-tax-credit-increase-small-businesses", "checked": "2026-10-11", "section": "Washington DOR, small-business B&O credit: maximum monthly credit by classification" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23B.25.130", "section": "RCW 23B.25.130 \u2014 election" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23B.25.120", "section": "RCW 23B.25.120 \u2014 dissent" } ], "differences": [ "Purpose consideration is permissive unless articles strengthen it.", "Annual public reporting without a mandatory assessment standard.", "Any qualifying shareholder can use derivative enforcement; no model 2% or 5% gate." ], "gaps": [ "Actual Washington B&O and other operating taxes are outside this model." ], "confidence": "Current code and agency fee schedule", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 12, 12 ], "reason": "Social purpose corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Washington offers Social purpose corporation. Washington gets partial form credit because its social-purpose corporation uses a different mission model.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 14, 14 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Washington has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only opt-in charter monetary limitation; exceptions include intentional misconduct, knowing law violation, unlawful distributions and improper personal benefit.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Washington does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Washington requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Washington has no separately credited benefit-specific monetary shield for company. Director and officer purpose-duty liability bars depend on compliance with good faith, care and best-interest standards. Not a bar to unrelated duties.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Washington earns the benefit-specific credit for directors. Director and officer purpose-duty liability bars depend on compliance with good faith, care and best-interest standards. Not a bar to unrelated duties.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific officer monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Washington earns the benefit-specific credit for officers. Director and officer purpose-duty liability bars depend on compliance with good faith, care and best-interest standards. Not a bar to unrelated duties.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Washington: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Washington: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit. No mandatory third-party assessment standard identified; companies can elect one.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Washington: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Washington has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $70 + benefit filing $0 = $70 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Washington has a compared recurring floor of $70 per year, including $0 in identified minimum tax/license charges. Fixed yearly baseline only, ordinary domestic corporation. Variable B&O is excluded; the small-business credit may eliminate it at sufficiently low activity, depending on classification and reporting period. State/city license endorsements, registry charges and sales/payroll taxes are excluded. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 12, 12 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Existing domestic corporations elect social purpose status through a board-approved plan that includes an articles amendment. RCW 23B.25.130 specifies the election votes; RCW 23B.25.120 preserves applicable fair-value dissent rights. This is a related social purpose form.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Washington: becoming a benefit company requires At least two-thirds of all votes entitled to be cast AND two-thirds of each outstanding class or series; additional voting groups and higher requirements apply. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 6, 6 ], "reason": "Two-thirds default benefit exit gate: 6 points. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Washington: changing back requires 2/3 each class. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 14, 14 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Washington requires report access for people outside the company, so it earns public-access credit. Annual public website report within four months of year end. After two consecutive missed fiscal years, a shareholder may seek a summary reporting order.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Washington: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Washington: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit. No mandatory third-party assessment standard identified; companies can elect one.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "Permissive statutory default: 0 mandatory-duty points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Washington has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. Directors may consider and give weight to social purposes unless articles require more. Promotion of purpose is deemed in the corporation\u2019s best interests.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 70, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "two_thirds", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 70, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Two-thirds default" }, "scoreRange": [ 67, 67 ], "tax": { "code": "WA", "incomeSummary": "Washington has no general corporate net-income tax, but B&O taxes gross business receipts without expense deductions. Current major rates include 0.471% retailing, 0.484% manufacturing/wholesaling and 1.5% services below $1 million prior-year income, 1.75% from $1 million to under $5 million, and 2.1% at $5 million or more. Classification and other taxes matter.", "recurringSummary": "B&O has no flat general corporate annual minimum; qualifying small businesses receive a credit against calculated tax. Annual registry fees, local B&O and business-license endorsements are separate. Zero taxable profit does not imply zero B&O.", "formationAnnualTaxFloor": 0, "floorBasis": "No fixed general corporate-income/B&O annual charge added. Registry fees and all variable receipts, sales, payroll, property and local taxes excluded; this is not a no-tax claim.", "scenarioMinimum": 0, "scenarioBasis": "Fixed yearly baseline only, ordinary domestic corporation. Variable B&O is excluded; the small-business credit may eliminate it at sufficiently low activity, depending on classification and reporting period. State/city license endorsements, registry charges and sales/payroll taxes are excluded.", "operatingTaxCaution": "Washington nexus and receipts sourcing/apportionment govern B&O. Services, digital products and retail activities can fall under different classifications; an out-of-state charter does not remove Washington tax on business activity.", "sources": [ { "label": "Washington DOR, forms/publications: no corporate income tax", "url": "https://dor.wa.gov/forms-publications", "checked": "2026-10-11", "section": "Washington DOR, forms/publications: no corporate income tax" }, { "label": "Washington DOR, B&O tax: gross receipts and no expense deduction", "url": "https://dor.wa.gov/taxes-rates/business-occupation-tax", "checked": "2026-10-11", "section": "Washington DOR, B&O tax: gross receipts and no expense deduction" }, { "label": "Washington DOR, current B&O classifications and rates", "url": "https://dor.wa.gov/taxes-rates/business-occupation-tax/business-occupation-tax-classifications", "checked": "2026-10-11", "section": "Washington DOR, current B&O classifications and rates" }, { "label": "Washington DOR, small-business B&O credit: maximum monthly credit by classification", "url": "https://dor.wa.gov/forms-publications/publications-subject/special-notices/business-and-occupation-tax-credit-increase-small-businesses", "checked": "2026-10-11", "section": "Washington DOR, small-business B&O credit: maximum monthly credit by classification" } ] }, "conversion": { "state": "Washington", "code": "WA", "form": "Social purpose corporation", "status": "Related", "group": "special", "groupLabel": "Special entry approval", "entryVote": "At least two-thirds of all votes entitled to be cast AND two-thirds of each outstanding class or series; additional voting groups and higher requirements apply.", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Existing domestic corporations elect social purpose status through a board-approved plan that includes an articles amendment. RCW 23B.25.130 specifies the election votes; RCW 23B.25.120 preserves applicable fair-value dissent rights. This is a related social purpose form.", "proposal": "Washington has a social purpose corporation, not the same benefit-duty model. Consider ordinary-vote election, appraisal reform and whether to add a mandatory balancing benefit option.", "sources": [ { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23B.25.130", "section": "RCW 23B.25.130 \u2014 election" }, { "url": "https://app.leg.wa.gov/rcw/default.aspx?cite=23B.25.120", "section": "RCW 23B.25.120 \u2014 dissent" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Related social purpose corporation: general positive effects on selected stakeholder categories; specific social purposes optional.", "difference": "Washington offers Social purpose corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only opt-in charter monetary limitation; exceptions include intentional misconduct, knowing law violation, unlawful distributions and improper personal benefit. Benefit-specific rule: Director and officer purpose-duty liability bars depend on compliance with good faith, care and best-interest standards. Not a bar to unrelated duties.", "difference": "Washington keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. " }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual public website report within four months of year end. After two consecutive missed fiscal years, a shareholder may seek a summary reporting order. Assessment rule: No mandatory third-party assessment standard identified; companies can elect one.", "difference": "Washington: Annual; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $70 per year on an annualized basis. Minimum tax/license used here: $0. Fixed yearly baseline only, ordinary domestic corporation. Variable B&O is excluded; the small-business credit may eliminate it at sufficiently low activity, depending on classification and reporting period. State/city license endorsements, registry charges and sales/payroll taxes are excluded.", "difference": "Washington has a compared recurring floor of $70 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: At least two-thirds of all votes entitled to be cast AND two-thirds of each outstanding class or series; additional voting groups and higher requirements apply. Existing domestic corporations elect social purpose status through a board-approved plan that includes an articles amendment. RCW 23B.25.130 specifies the election votes; RCW 23B.25.120 preserves applicable fair-value dissent rights. This is a related social purpose form. Changing back: 2/3 each class", "difference": "Washington entry uses At least two-thirds of all votes entitled to be cast AND two-thirds of each outstanding class or series; additional voting groups and higher requirements apply.; exit uses 2/3 each class. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors may consider and give weight to social purposes unless articles require more. Promotion of purpose is deemed in the corporation\u2019s best interests. Disclosure: Annual public website report within four months of year end. After two consecutive missed fiscal years, a shareholder may seek a summary reporting order. Enforcement: Only shareholders bring purpose-duty actions in the corporation\u2019s right. Ordinary derivative procedure and contemporaneous ownership apply; no special percentage threshold.", "difference": "Washington requires public access to the report. Annual public reporting without a mandatory assessment standard. Any qualifying shareholder can use derivative enforcement; no model 2% or 5% gate." } } }, "guideUrl": "/assets/state-guides/WA.md" }, { "state": "West Virginia", "abbreviation": "WV", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit mandatory stakeholder model; ordinary status vote", "features": { "purpose": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-3-301/", "section": "W. Va. Code 31F-3-301" } ], "confidence": "high", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit required. Specific benefits may be chosen through articles, bylaws OR board action, unusually flexible." }, "board": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-4-401/", "section": "W. Va. Code 31F-4-401" } ], "confidence": "high", "mode": "mandatory_stakeholder_consideration", "summary": "Directors shall consider listed stakeholders; no required priority unless articles specify. Beneficiaries have no director duty solely by status." }, "standard": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-5-501/", "section": "W. Va. Code 31F-5-501" }, { "url": "https://code.wvlegislature.gov/31F-5-501/", "section": "W. Va. Code 31F-5-501" } ], "confidence": "high", "required": true, "summary": "Annual assessment against third-party standard required. No statutory requirement to buy third-party certification in annual report provision.", "thirdPartyRequired": true, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-5-501/", "section": "W. Va. Code 31F-5-501" } ], "confidence": "high", "required": false, "summary": "No statutory requirement to buy third-party certification in annual report provision." }, "report": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-5-501/", "section": "W. Va. Code 31F-5-501" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": true, "stateFiling": false, "summary": "Annual shareholder delivery within 120 days/year-end or annual report delivery. Latest report public website or free on request; specified proprietary information/compensation may be removed. No state benefit filing specified." }, "enforcement": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-4-403/", "section": "W. Va. Code 31F-4-403" } ], "confidence": "high", "threshold": "any_shareholder", "summary": "Company directly; derivatively any shareholder, director or charter/bylaw designee; no percentage floor or 5% parent category stated." }, "benefitLiability": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-4-401/", "section": "W. Va. Code 31F-4-401" }, { "url": "https://code.wvlegislature.gov/31F-4-402/", "section": "W. Va. Code 31F-4-402" }, { "url": "https://code.wvlegislature.gov/31F-4-403/", "section": "W. Va. Code 31F-4-403" } ], "confidence": "high", "company": false, "directors": true, "officers": false, "summary": "Director compliant-conduct/benefit-failure monetary bar applies in corporation/shareholder suits. Officer good-faith-business-judgment protection linked to purpose and standard. No express company benefit-failure monetary bar in enforcement provision." }, "ordinaryExculpation": { "sources": [ { "url": "https://code.wvlegislature.gov/31D-2-202/", "section": "W. Va. Code 31D-2-202" } ], "confidence": "high", "director": true, "officer": false, "optIn": true, "summary": "Director-only charter fiduciary monetary exculpation excludes loyalty, bad faith/intentional misconduct/knowing law violation, unlawful distributions and improper personal benefit. Prospective.", "automatic": false }, "statusChange": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-2-202/", "section": "W. Va. Code 31F-2-202" }, { "url": "https://code.wvlegislature.gov/31F-2-203/", "section": "W. Va. Code 31F-2-203" }, { "url": "https://code.wvlegislature.gov/31D-10-1003/", "section": "W. Va. Code 31D-10-1003" }, { "url": "https://code.wvlegislature.gov/31D-7-725/", "section": "W. Va. Code 31D-7-725(c): votes for exceed against when quorum exists" } ], "confidence": "high", "entry": "ordinary amendment: votes for exceed against at majority quorum", "exit": "ordinary amendment: votes for exceed against at majority quorum", "lock": "No additional permanent statutory mission lock in the cited provisions; status-change voting rule applies.", "summary": "Entry and exit use ordinary article-amendment procedures, with board adoption/submission and shareholder notice. Default approval is votes favoring the amendment exceed votes opposing in each required voting group, at a meeting with a quorum of at least a majority of votes entitled to be cast. Articles or board conditions can require more; separate voting groups apply where statutory class/series rights require them. The benefit chapter adds no separate two-thirds status vote.", "exitVote": "ordinary amendment: votes for exceed against at majority quorum", "entryVote": "ordinary amendment: votes for exceed against at majority quorum" } }, "costs": { "regularReport": { "sources": [ { "url": "https://sos.wv.gov/business/updates-and-changes/annual-reports", "section": "Annual Reports" } ], "confidence": "high", "amount": 25, "cadence": "annual", "online": 26, "paper": 25, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Ordinary for-profit annual report $25 timely by June 30; online filing adds $1 processing. Veteran waiver can apply first four years.", "conditions": "Ordinary for-profit annual report $25 timely by June 30; online filing adds $1 processing. Veteran waiver can apply first four years." }, "benefitReport": { "sources": [ { "url": "https://code.wvlegislature.gov/31F-5-501/", "section": "W. Va. Code 31F-5-501" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://tax.wv.gov/ResearchAndGovernment/Research/TaxExpenditureStudy/CorporationTax/Pages/CorporationTax.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://tax.wv.gov/Documents/Legal/TaxLawReports/TaxLawReport.51.pdf", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://tax.wv.gov/Business/CorporateIncomeTax/Pages/CorporateIncomeTax.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "West Virginia Tax Division: corporation-income tax and franchise-tax history", "url": "https://tax.wv.gov/ResearchAndGovernment/Research/TaxExpenditureStudy/CorporationTax/Pages/CorporationTax.aspx", "checked": "2026-10-11", "section": "West Virginia Tax Division: corporation-income tax and franchise-tax history" }, { "label": "West Virginia economic-development agency: 6.5% rate and franchise repeal", "url": "https://westvirginia.gov/advantage-west-virginia/pro-business-climate/", "checked": "2026-10-11", "section": "West Virginia economic-development agency: 6.5% rate and franchise repeal" }, { "label": "West Virginia Tax Division: current single-sales-factor and market sourcing", "url": "https://tax.wv.gov/Business/CorporateIncomeTax/Pages/CorporateIncomeTax.aspx", "checked": "2026-10-11", "section": "West Virginia Tax Division: current single-sales-factor and market sourcing" } ], "confidence": "high", "amount": 0, "cadence": "annual; liability depends on applicable tax base/exemptions", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "calculationRequired": true, "universalFlatMinimum": false, "summary": "West Virginia business franchise tax ceased after December 31, 2014. Corporate net income tax remains 6.5% on West Virginia taxable income for domestic/foreign corporations with the applicable business/income connection; nexus, apportionment, exemptions and credits affect the actual amount. There is no former flat franchise-tax minimum to add to the annual registry report fee.", "conditions": "West Virginia business franchise tax ceased after December 31, 2014. Corporate net income tax remains 6.5% on West Virginia taxable income for domestic/foreign corporations with the applicable business/income connection; nexus, apportionment, exemptions and credits affect the actual amount. There is no former flat franchise-tax minimum to add to the annual registry report fee." } }, "sources": [ { "url": "https://code.wvlegislature.gov/31F-3-301/", "section": "W. Va. Code 31F-3-301" }, { "url": "https://code.wvlegislature.gov/31F-4-401/", "section": "W. Va. Code 31F-4-401" }, { "url": "https://code.wvlegislature.gov/31F-5-501/", "section": "W. Va. Code 31F-5-501" }, { "url": "https://code.wvlegislature.gov/31F-4-403/", "section": "W. Va. Code 31F-4-403" }, { "url": "https://code.wvlegislature.gov/31F-4-402/", "section": "W. Va. Code 31F-4-402" }, { "url": "https://code.wvlegislature.gov/31D-2-202/", "section": "W. Va. Code 31D-2-202" }, { "url": "https://code.wvlegislature.gov/31F-2-202/", "section": "W. Va. Code 31F-2-202" }, { "url": "https://code.wvlegislature.gov/31F-2-203/", "section": "W. Va. Code 31F-2-203" }, { "url": "https://code.wvlegislature.gov/31D-10-1003/", "section": "W. Va. Code 31D-10-1003" }, { "url": "https://code.wvlegislature.gov/31D-7-725/", "section": "W. Va. Code 31D-7-725(c): votes for exceed against when quorum exists" }, { "url": "https://sos.wv.gov/business/updates-and-changes/annual-reports", "section": "Annual Reports" }, { "url": "https://tax.wv.gov/ResearchAndGovernment/Research/TaxExpenditureStudy/CorporationTax/Pages/CorporationTax.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://tax.wv.gov/Documents/Legal/TaxLawReports/TaxLawReport.51.pdf", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://tax.wv.gov/Business/CorporateIncomeTax/Pages/CorporateIncomeTax.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "West Virginia Tax Division: corporation-income tax and franchise-tax history", "url": "https://tax.wv.gov/ResearchAndGovernment/Research/TaxExpenditureStudy/CorporationTax/Pages/CorporationTax.aspx", "checked": "2026-10-11", "section": "West Virginia Tax Division: corporation-income tax and franchise-tax history" }, { "label": "West Virginia economic-development agency: 6.5% rate and franchise repeal", "url": "https://westvirginia.gov/advantage-west-virginia/pro-business-climate/", "checked": "2026-10-11", "section": "West Virginia economic-development agency: 6.5% rate and franchise repeal" }, { "label": "West Virginia Tax Division: current single-sales-factor and market sourcing", "url": "https://tax.wv.gov/Business/CorporateIncomeTax/Pages/CorporateIncomeTax.aspx", "checked": "2026-10-11", "section": "West Virginia Tax Division: current single-sales-factor and market sourcing" } ], "differences": [ "Specific purpose may be board/bylaw action.", "Entry/exit ordinary vote; no benefit-specific 2/3.", "Company monetary bar not included, unlike many model states.", "Any shareholder enforcement." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "West Virginia offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 10, 10 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "West Virginia has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only charter fiduciary monetary exculpation excludes loyalty, bad faith/intentional misconduct/knowing law violation, unlawful distributions and improper personal benefit. Prospective.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "West Virginia does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "West Virginia requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "West Virginia has no separately credited benefit-specific monetary shield for company. Director compliant-conduct/benefit-failure monetary bar applies in corporation/shareholder suits. Officer good-faith-business-judgment protection linked to purpose and standard. No express company benefit-failure monetary bar in enforcement provision.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "West Virginia earns the benefit-specific credit for directors. Director compliant-conduct/benefit-failure monetary bar applies in corporation/shareholder suits. Officer good-faith-business-judgment protection linked to purpose and standard. No express company benefit-failure monetary bar in enforcement provision.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "West Virginia has no separately credited benefit-specific monetary shield for officers. Director compliant-conduct/benefit-failure monetary bar applies in corporation/shareholder suits. Officer good-faith-business-judgment protection linked to purpose and standard. No express company benefit-failure monetary bar in enforcement provision.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 15, 15 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "West Virginia: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 3, 3 ], "reason": "Mandatory third-party standard: 3 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "West Virginia: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "West Virginia: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "West Virginia has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $25 + benefit filing $0 = $25 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "West Virginia has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation in a regular full year with no West Virginia taxable profit after state modifications and apportionment. The separate annual-report fee and any other operating taxes remain additional. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 10, 10 ], "reason": "Entry and exit use ordinary article-amendment procedures, with board adoption/submission and shareholder notice. Default approval is votes favoring the amendment exceed votes opposing in each required voting group, at a meeting with a quorum of at least a majority of votes entitled to be cast. Articles or board conditions can require more; separate voting groups apply where statutory class/series rights require them. The benefit chapter adds no separate two-thirds status vote.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "West Virginia: becoming a benefit company requires ordinary amendment: votes for exceed against at majority quorum. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 10, 10 ], "reason": "No added benefit-status supermajority: 10 points. Ordinary transaction votes and any higher charter votes still apply. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "West Virginia: changing back requires ordinary amendment: votes for exceed against at majority quorum. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 8, 8 ], "reason": "Mandatory public access: 8 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "West Virginia requires report access for people outside the company, so it earns public-access credit. Annual shareholder delivery within 120 days/year-end or annual report delivery. Latest report public website or free on request; specified proprietary information/compensation may be removed. No state benefit filing specified.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "West Virginia: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 3, 3 ], "reason": "Mandatory third-party assessment standard: 3 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "West Virginia: Required. Using an outside framework reduces flexibility credit but earns transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "West Virginia makes a mission duty mandatory, so it earns this credit. Directors shall consider listed stakeholders; no required priority unless articles specify. Beneficiaries have no director duty solely by status.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 25, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "ordinary", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 25, "minimumTaxAnnualized": 0, "entryCategory": "ordinary" }, "grouping": { "assessment": "Required", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Ordinary transaction votes" }, "scoreRange": [ 77, 77 ], "tax": { "code": "WV", "incomeSummary": "West Virginia corporation net income tax is 6.5% of West Virginia taxable income for ordinary subject corporations. Since tax year 2022, the state uses single-sales-factor apportionment and market sourcing for services and certain intangible property.", "recurringSummary": "The former Business Franchise Tax ceased after December 31, 2014. No former franchise minimum should be added to current annual registry reporting. Corporate income, sector-specific business taxes and property, sales and payroll taxes remain separate obligations.", "formationAnnualTaxFloor": null, "floorBasis": "No current ordinary fixed corporation franchise-tax floor is identified after its 2015 elimination. Zero income tax requires no West Virginia taxable income, not merely no profit on an unadjusted federal return. Registry reporting and operating taxes are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation in a regular full year with no West Virginia taxable profit after state modifications and apportionment. The separate annual-report fee and any other operating taxes remain additional.", "operatingTaxCaution": "The Tax Division treats domestic and foreign corporations engaged in business/deriving state income as subject. Its current sourcing page places services in the numerator when delivered to West Virginia customers and licensed intangibles when used in the state. Incorporation elsewhere does not remove those customer-market connections.", "sources": [ { "label": "West Virginia Tax Division: corporation-income tax and franchise-tax history", "url": "https://tax.wv.gov/ResearchAndGovernment/Research/TaxExpenditureStudy/CorporationTax/Pages/CorporationTax.aspx", "checked": "2026-10-11", "section": "West Virginia Tax Division: corporation-income tax and franchise-tax history" }, { "label": "West Virginia economic-development agency: 6.5% rate and franchise repeal", "url": "https://westvirginia.gov/advantage-west-virginia/pro-business-climate/", "checked": "2026-10-11", "section": "West Virginia economic-development agency: 6.5% rate and franchise repeal" }, { "label": "West Virginia Tax Division: current single-sales-factor and market sourcing", "url": "https://tax.wv.gov/Business/CorporateIncomeTax/Pages/CorporateIncomeTax.aspx", "checked": "2026-10-11", "section": "West Virginia Tax Division: current single-sales-factor and market sourcing" } ] }, "conversion": { "state": "West Virginia", "code": "WV", "form": "Benefit corporation", "status": "Available", "group": "ordinary", "groupLabel": "Ordinary / qualified-majority route", "entryVote": "ordinary amendment: votes for exceed against at majority quorum", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry and exit use ordinary article-amendment procedures, with board adoption/submission and shareholder notice. Default approval is votes favoring the amendment exceed votes opposing in each required voting group, at a meeting with a quorum of at least a majority of votes entitled to be cast. Articles or board conditions can require more; separate voting groups apply where statutory class/series rights require them. The benefit chapter adds no separate two-thirds status vote.", "proposal": "Preserve the ordinary or qualified-majority route; improve forms, costs, notices and reporting without overriding charter or contract rights.", "sources": [ { "url": "https://code.wvlegislature.gov/31F-2-202/", "section": "W. Va. Code 31F-2-202" }, { "url": "https://code.wvlegislature.gov/31F-2-203/", "section": "W. Va. Code 31F-2-203" }, { "url": "https://code.wvlegislature.gov/31D-10-1003/", "section": "W. Va. Code 31D-10-1003" }, { "url": "https://code.wvlegislature.gov/31D-7-725/", "section": "W. Va. Code 31D-7-725(c): votes for exceed against when quorum exists" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required. Specific benefits may be chosen through articles, bylaws OR board action, unusually flexible.", "difference": "West Virginia offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only charter fiduciary monetary exculpation excludes loyalty, bad faith/intentional misconduct/knowing law violation, unlawful distributions and improper personal benefit. Prospective. Benefit-specific rule: Director compliant-conduct/benefit-failure monetary bar applies in corporation/shareholder suits. Officer good-faith-business-judgment protection linked to purpose and standard. No express company benefit-failure monetary bar in enforcement provision.", "difference": "West Virginia keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Company monetary bar not included, unlike many model states." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder delivery within 120 days/year-end or annual report delivery. Latest report public website or free on request; specified proprietary information/compensation may be removed. No state benefit filing specified. Assessment rule: Annual assessment against third-party standard required. No statutory requirement to buy third-party certification in annual report provision.", "difference": "West Virginia: Annual; Required outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $25 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation in a regular full year with no West Virginia taxable profit after state modifications and apportionment. The separate annual-report fee and any other operating taxes remain additional.", "difference": "West Virginia has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: ordinary amendment: votes for exceed against at majority quorum. Entry and exit use ordinary article-amendment procedures, with board adoption/submission and shareholder notice. Default approval is votes favoring the amendment exceed votes opposing in each required voting group, at a meeting with a quorum of at least a majority of votes entitled to be cast. Articles or board conditions can require more; separate voting groups apply where statutory class/series rights require them. The benefit chapter adds no separate two-thirds status vote. Changing back: ordinary amendment: votes for exceed against at majority quorum", "difference": "West Virginia entry uses ordinary amendment: votes for exceed against at majority quorum; exit uses ordinary amendment: votes for exceed against at majority quorum. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors shall consider listed stakeholders; no required priority unless articles specify. Beneficiaries have no director duty solely by status. Disclosure: Annual shareholder delivery within 120 days/year-end or annual report delivery. Latest report public website or free on request; specified proprietary information/compensation may be removed. No state benefit filing specified. Enforcement: Company directly; derivatively any shareholder, director or charter/bylaw designee; no percentage floor or 5% parent category stated.", "difference": "West Virginia requires public access to the report. Any shareholder enforcement." } } }, "guideUrl": "/assets/state-guides/WV.md" }, { "state": "Wisconsin", "abbreviation": "WI", "form": "Benefit corporation", "status": "Available", "reviewed": "2026-10-11", "family": "General-benefit consideration with optional standard/publicity", "features": { "purpose": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.102; 204.201; official current PDF through October 1, 2026" } ], "confidence": "high", "generalRequired": true, "specificRequired": false, "specificOptional": true, "summary": "General public benefit required, specific optional. General benefit definition uses material positive society/environment impact without making third-party standard part of definition." }, "board": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.301; 204.302; official current PDF through October 1, 2026" } ], "confidence": "high", "mode": "mandatory_stakeholder_consideration", "summary": "Directors shall consider listed stakeholders; charter priorities allowed. All benefit corporations must designate benefit director; chapter does not impose model independent-director requirement." }, "standard": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.401(3); official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.401(3); official current PDF through October 1, 2026" } ], "confidence": "high", "required": false, "summary": "Optional through articles/bylaws. Optional through articles/bylaws.", "thirdPartyRequired": false, "certificationRequired": false }, "certification": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.401(3); official current PDF through October 1, 2026" } ], "confidence": "high", "required": false, "summary": "Optional through articles/bylaws." }, "report": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.401; official current PDF through October 1, 2026" } ], "confidence": "high", "cadence": "annual", "shareholders": true, "public": false, "stateFiling": false, "summary": "Annual shareholder statement within 30 days after fiscal-year end. Public report and third-party standard/certification are optional articles/bylaws requirements; no state benefit filing." }, "enforcement": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.0741; official current PDF through October 1, 2026" } ], "confidence": "high", "threshold": "ordinary derivative any qualifying shareholder", "summary": "No dedicated percentage-threshold benefit-enforcement section in chapter 204. Ordinary derivative standing requires contemporaneous shareholder/beneficial-owner and adequate representation; no numeric floor." }, "benefitLiability": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.301; 204.302; 204.303; official current PDF through October 1, 2026" } ], "confidence": "high", "company": false, "directors": true, "officers": false, "summary": "Directors monetary protection for compliant actions and benefit failure; officers protected for compliant actions. Benefit director loses special protection for self-dealing, willful misconduct or knowing illegality. No blanket company monetary bar in chapter." }, "ordinaryExculpation": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.0828; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.0841; 180.0851-180.0859: officer duties and indemnification" } ], "confidence": "high", "director": true, "officer": false, "optIn": false, "summary": "Automatic director-only monetary-liability limitation for internal corporate/shareholder claims; charter may narrow it. Exceptions: willful unfair dealing with a material conflict, criminal-law violation (reasonable-lawfulness exception), improper profit, and willful misconduct. Officers are not included in section 180.0828; section 180.0841 assigns officer duties but supplies no equivalent exculpation. Separate director/officer indemnification provisions can fund defense and certain judgments subject to their own conditions.", "automatic": true }, "statusChange": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.104; 204.105; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.1003(3), 180.0725, 180.0726, 180.1706: ordinary amendment vote" } ], "confidence": "high", "entry": "2/3 shares entitled vote", "exit": "ordinary amendment: votes for exceed against with quorum, subject to voting groups/greater thresholds", "lock": "1-year reentry wait", "summary": "Entry/covered fundamental transaction requires 2/3 shares entitled to vote notwithstanding governing-document provisions, plus dissent rights. Exit deletes status statement under ordinary amendment rules; one-year wait before benefit reelection. For a newly formed corporation, the ordinary amendment default is votes favoring exceed votes opposing in each required voting group at a quorum meeting (180.0725/180.0726). If an amendment creates dissenters rights, 180.1003(3)(a) requires a majority of votes entitled to be cast by the affected voting group. The articles, authorized bylaws or board conditions can require more; pre-1973 corporations have transitional rules under 180.1706.", "exitVote": "ordinary amendment: votes for exceed against with quorum, subject to voting groups/greater thresholds", "entryVote": "2/3 shares entitled vote" } }, "costs": { "regularReport": { "sources": [ { "url": "https://dfi.wi.gov/Pages/BusinessServices/BusinessEntities/Fees.aspx", "section": "Domestic business corporation annual report" } ], "confidence": "high", "amount": 25, "cadence": "annual", "online": 25, "paper": 40, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "Domestic business-corporation annual report $25 online/$40 paper.", "conditions": "Domestic business-corporation annual report $25 online/$40 paper." }, "benefitReport": { "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.401; official current PDF through October 1, 2026" } ], "confidence": "high", "amount": 0, "cadence": "none", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "summary": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified.", "conditions": "No mandatory state benefit-report filing in the cited reporting provision; no separate required filing fee identified." }, "minimumTax": { "sources": [ { "url": "https://www.revenue.wi.gov/Pages/faqs/ise-crpginfo.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.revenue.wi.gov/Pages/FAQS/pcs-temp.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Wisconsin Revenue: 7.9% franchise/income alternatives, filing requirements, and surcharge eligibility", "url": "https://www.revenue.wi.gov/Pages/faqs/ise-crpginfo.aspx", "checked": "2026-10-11", "section": "Wisconsin Revenue: 7.9% franchise/income alternatives, filing requirements, and surcharge eligibility" }, { "label": "Wisconsin Revenue: January 2026 combined-filer guidance and C-corporation surcharge calculation", "url": "https://www.revenue.wi.gov/Pages/FAQS/ise-combrptx.aspx", "checked": "2026-10-11", "section": "Wisconsin Revenue: January 2026 combined-filer guidance and C-corporation surcharge calculation" }, { "label": "Wisconsin Revenue: economic-development surcharge overview", "url": "https://www.revenue.wi.gov/DORReports/25sumrpt.pdf", "checked": "2026-10-11", "section": "Wisconsin Revenue: economic-development surcharge overview" } ], "confidence": "high", "amount": 0, "cadence": "annual; liability depends on applicable tax base/exemptions", "online": null, "paper": null, "currency": "USD", "excludes": [ "registered agent", "formation", "late fees", "optional expedited service", "income/sales/payroll taxes" ], "calculationRequired": true, "universalFlatMinimum": false, "summary": "Wisconsin corporation franchise or income tax is 7.9% of Wisconsin taxable net income, rather than a flat annual franchise minimum. Corporations organized/licensed in Wisconsin generally must file even without activity, subject to exemptions. A separate economic-development surcharge applies to covered corporations engaged in Wisconsin business with at least $4 million gross receipts: for ordinary C corporations, greater of $25 or 3% of gross Wisconsin tax liability, capped at $9,800. The surcharge does not create a universal $25 annual floor for a small civic/technology company.", "conditions": "Wisconsin corporation franchise or income tax is 7.9% of Wisconsin taxable net income, rather than a flat annual franchise minimum. Corporations organized/licensed in Wisconsin generally must file even without activity, subject to exemptions. A separate economic-development surcharge applies to covered corporations engaged in Wisconsin business with at least $4 million gross receipts: for ordinary C corporations, greater of $25 or 3% of gross Wisconsin tax liability, capped at $9,800. The surcharge does not create a universal $25 annual floor for a small civic/technology company." } }, "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.102; 204.201; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.301; 204.302; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.401(3); official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.401; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.0741; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.301; 204.302; 204.303; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.0828; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.0841; 180.0851-180.0859: officer duties and indemnification" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.104; 204.105; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.1003(3), 180.0725, 180.0726, 180.1706: ordinary amendment vote" }, { "url": "https://dfi.wi.gov/Pages/BusinessServices/BusinessEntities/Fees.aspx", "section": "Domestic business corporation annual report" }, { "url": "https://www.revenue.wi.gov/Pages/faqs/ise-crpginfo.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "url": "https://www.revenue.wi.gov/Pages/FAQS/pcs-temp.aspx", "section": "Current state revenue guidance: corporate tax applicability, rate and exemptions" }, { "label": "Wisconsin Revenue: 7.9% franchise/income alternatives, filing requirements, and surcharge eligibility", "url": "https://www.revenue.wi.gov/Pages/faqs/ise-crpginfo.aspx", "checked": "2026-10-11", "section": "Wisconsin Revenue: 7.9% franchise/income alternatives, filing requirements, and surcharge eligibility" }, { "label": "Wisconsin Revenue: January 2026 combined-filer guidance and C-corporation surcharge calculation", "url": "https://www.revenue.wi.gov/Pages/FAQS/ise-combrptx.aspx", "checked": "2026-10-11", "section": "Wisconsin Revenue: January 2026 combined-filer guidance and C-corporation surcharge calculation" }, { "label": "Wisconsin Revenue: economic-development surcharge overview", "url": "https://www.revenue.wi.gov/DORReports/25sumrpt.pdf", "checked": "2026-10-11", "section": "Wisconsin Revenue: economic-development surcharge overview" } ], "differences": [ "Annual statement due within 30 days, much earlier than 120-day model states.", "General-benefit mandate without mandatory third-party standard/public report.", "Benefit director mandatory but independence not required in chapter.", "One-year reentry wait after exit.", "Ordinary director protection automatic." ], "gaps": [], "confidence": "Primary-source findings with stated qualifications", "sourceQualification": "Official chapters 180/204 published and certified October 1, 2026, through 2025 Wisconsin Act 247; fetched directly after web-tool access error.", "effectiveNotes": [], "region": "central", "scoring": { "components": { "form": { "range": [ 20, 20 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 20, 20 ], "reason": "Benefit corporation. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Wisconsin offers Benefit corporation. The benefit option receives the full form credit.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 13, 13 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Wisconsin has an identified director monetary-protection provision in the compared scope, which earns this credit. Automatic director-only monetary-liability limitation for internal corporate/shareholder claims; charter may narrow it. Exceptions: willful unfair dealing with a material conflict, criminal-law violation (reasonable-lawfulness exception), improper profit, and willful misconduct. Officers are not included in section 180.0828; section 180.0841 assigns officer duties but supplies no equivalent exculpation. Separate director/officer indemnification provisions can fund defense and certain judgments subject to their own conditions.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Wisconsin does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 3, 3 ], "reason": "Statutory coverage in the selected scope receives the 3-point default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Wisconsin has a default statutory liability rule in the compared scope, so it earns the automatic-coverage credit. Articles and retained exceptions still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Wisconsin has no separately credited benefit-specific monetary shield for company. Directors monetary protection for compliant actions and benefit failure; officers protected for compliant actions. Benefit director loses special protection for self-dealing, willful misconduct or knowing illegality. No blanket company monetary bar in chapter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 4, 4 ], "reason": "Identified benefit-specific director monetary protection receives 4 points, subject to statutory conditions.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Wisconsin earns the benefit-specific credit for directors. Directors monetary protection for compliant actions and benefit failure; officers protected for compliant actions. Benefit director loses special protection for self-dealing, willful misconduct or knowing illegality. No blanket company monetary bar in chapter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Wisconsin has no separately credited benefit-specific monetary shield for officers. Directors monetary protection for compliant actions and benefit failure; officers protected for compliant actions. Benefit director loses special protection for self-dealing, willful misconduct or knowing illegality. No blanket company monetary bar in chapter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 20, 20 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 5, 5 ], "reason": "Annual reporting receives 5 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Wisconsin: Annual. An annual report gets less ease-of-operation credit than a biennial report or no mandatory report because it must be prepared more often.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 8, 8 ], "reason": "Optional/no mandatory assessment standard: 8 flexibility points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Wisconsin: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 4, 4 ], "reason": "No separate state benefit-report filing: 4 flexibility points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Wisconsin: No separate state benefit-report filing. No separate state submission earns the no-extra-filing credit. Preparing, sharing or publishing the report may still be required.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 3, 3 ], "reason": "No scored mandatory benefit-director/report-approval procedure: 3 flexibility points.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Wisconsin has no additional scored benefit-director/report-approval step for this private-company scope, so it earns the ease-of-operation credit. Public-company rules and other duties may differ.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 15, 15 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 15, 15 ], "reason": "Ordinary reporting $25 + benefit filing $0 = $25 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Wisconsin has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges. Small active ordinary domestic C corporation with zero Wisconsin taxable net income and gross receipts from all activities below $4 million: $0 franchise/income tax and no economic-development surcharge. Excludes registry/report fees and other operating taxes. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 16, 16 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 6, 6 ], "reason": "Entry/covered fundamental transaction requires 2/3 shares entitled to vote notwithstanding governing-document provisions, plus dissent rights. Exit deletes status statement under ordinary amendment rules; one-year wait before benefit reelection. For a newly formed corporation, the ordinary amendment default is votes favoring exceed votes opposing in each required voting group at a quorum meeting (180.0725/180.0726). If an amendment creates dissenters rights, 180.1003(3)(a) requires a majority of votes entitled to be cast by the affected voting group. The articles, authorized bylaws or board conditions can require more; pre-1973 corporations have transitional rules under 180.1706.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Wisconsin: becoming a benefit company requires 2/3 shares entitled vote. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 10, 10 ], "reason": "No added benefit-status supermajority: 10 points. Ordinary transaction votes and any higher charter votes still apply. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Wisconsin: changing back requires ordinary amendment: votes for exceed against with quorum, subject to voting groups/greater thresholds. Ordinary votes receive more ease-of-change credit than two-thirds; three-quarters, 90% and unanimous gates receive less. Class votes, notice, appraisal and any higher charter requirements remain.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 9, 9 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No statutory public benefit-report access mandate: 0 points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Wisconsin has no mandatory public access in the compared variant, so it gets no public-access credit. Voluntary publication is still possible. Annual shareholder statement within 30 days after fiscal-year end. Public report and third-party standard/certification are optional articles/bylaws requirements; no state benefit filing.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 6, 6 ], "reason": "Annual reporting: 6 accountability points.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Wisconsin: Annual. Annual updates earn more transparency credit than biennial updates; no mandated report earns none.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "Optional/no mandated standard: 0 accountability points.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Wisconsin: Optional / no mandate. An optional framework earns more flexibility credit and no mandatory-framework transparency credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 3, 3 ], "reason": "Mandatory mission/stakeholder duty: 3 accountability points.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Wisconsin makes a mission duty mandatory, so it earns this credit. Directors shall consider listed stakeholders; charter priorities allowed. All benefit corporations must designate benefit director; chapter does not impose model independent-director requirement.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 25, "ordinaryScope": { "director": true, "officer": false, "automatic": true }, "exitCategory": "ordinary", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 25, "minimumTaxAnnualized": 0, "entryCategory": "two_thirds" }, "grouping": { "assessment": "Optional / no mandate", "cadence": "Annual", "filing": "No separate state benefit-report filing", "ordinaryScope": "Director scope only", "exit": "Ordinary transaction votes" }, "scoreRange": [ 77, 77 ], "tax": { "code": "WI", "incomeSummary": "Wisconsin imposes either corporate franchise tax or corporate income tax at 7.9% of Wisconsin taxable net income; the two are alternatives, not additive taxes. Domestic corporations with nonexempt income are generally under the franchise-tax version, which is income-based despite its name.", "recurringSummary": "No general flat franchise/capital minimum applies to the small ordinary corporation. Covered corporations with at least $4 million in gross receipts from all activities and Wisconsin business activity owe an economic-development surcharge: for ordinary C corporations, 3% of gross Wisconsin tax liability, at least $25 and at most $9,800. The conditional $25 minimum is not universal. Corporate annual report fees are separate.", "formationAnnualTaxFloor": null, "floorBasis": "No positive charter-only annual tax floor for an ordinary small domestic stock C corporation. Income-based franchise tax and receipt/activity-dependent surcharge must be calculated; annual report and other operating charges are excluded.", "scenarioMinimum": 0, "scenarioBasis": "Small active ordinary domestic C corporation with zero Wisconsin taxable net income and gross receipts from all activities below $4 million: $0 franchise/income tax and no economic-development surcharge. Excludes registry/report fees and other operating taxes.", "operatingTaxCaution": "Domestic/licensed corporations generally file even without business activity, subject to exemptions. Wisconsin nexus, state income adjustments, allocation/apportionment, and combined reporting determine tax. Surcharge eligibility counts receipts from all activities and is evaluated for the covered corporation; a loss alone does not remove the $25 conditional minimum once eligible.", "sources": [ { "label": "Wisconsin Revenue: 7.9% franchise/income alternatives, filing requirements, and surcharge eligibility", "url": "https://www.revenue.wi.gov/Pages/faqs/ise-crpginfo.aspx", "checked": "2026-10-11", "section": "Wisconsin Revenue: 7.9% franchise/income alternatives, filing requirements, and surcharge eligibility" }, { "label": "Wisconsin Revenue: January 2026 combined-filer guidance and C-corporation surcharge calculation", "url": "https://www.revenue.wi.gov/Pages/FAQS/ise-combrptx.aspx", "checked": "2026-10-11", "section": "Wisconsin Revenue: January 2026 combined-filer guidance and C-corporation surcharge calculation" }, { "label": "Wisconsin Revenue: economic-development surcharge overview", "url": "https://www.revenue.wi.gov/DORReports/25sumrpt.pdf", "checked": "2026-10-11", "section": "Wisconsin Revenue: economic-development surcharge overview" } ] }, "conversion": { "state": "Wisconsin", "code": "WI", "form": "Benefit corporation", "status": "Available", "group": "special", "groupLabel": "Special entry approval", "entryVote": "2/3 shares entitled vote", "route": "Existing domestic stock corporation: use the statute\u2019s charter/articles election process and its board, shareholder, class and notice requirements.", "currentDetail": "Entry/covered fundamental transaction requires 2/3 shares entitled to vote notwithstanding governing-document provisions, plus dissent rights. Exit deletes status statement under ordinary amendment rules; one-year wait before benefit reelection. For a newly formed corporation, the ordinary amendment default is votes favoring exceed votes opposing in each required voting group at a quorum meeting (180.0725/180.0726). If an amendment creates dissenters rights, 180.1003(3)(a) requires a majority of votes entitled to be cast by the affected voting group. The articles, authorized bylaws or board conditions can require more; pre-1973 corporations have transitional rules under 180.1706.", "proposal": "Simplify the two-thirds entry rule and associated dissent rights; review the one-year reelection wait separately.", "sources": [ { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/204.pdf", "section": "Wis. Stat. 204.104; 204.105; official current PDF through October 1, 2026" }, { "url": "https://docs.legis.wisconsin.gov/statutes/statutes/180.pdf", "section": "Wis. Stat. 180.1003(3), 180.0725, 180.0726, 180.1706: ordinary amendment vote" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "General public benefit required, specific optional. General benefit definition uses material positive society/environment impact without making third-party standard part of definition.", "difference": "Wisconsin offers Benefit corporation." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Automatic director-only monetary-liability limitation for internal corporate/shareholder claims; charter may narrow it. Exceptions: willful unfair dealing with a material conflict, criminal-law violation (reasonable-lawfulness exception), improper profit, and willful misconduct. Officers are not included in section 180.0828; section 180.0841 assigns officer duties but supplies no equivalent exculpation. Separate director/officer indemnification provisions can fund defense and certain judgments subject to their own conditions. Benefit-specific rule: Directors monetary protection for compliant actions and benefit failure; officers protected for compliant actions. Benefit director loses special protection for self-dealing, willful misconduct or knowing illegality. No blanket company monetary bar in chapter.", "difference": "Wisconsin keeps this ordinary shield limited to directors and a default statutory liability rule. Benefit director mandatory but independence not required in chapter. Ordinary director protection automatic." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "Annual shareholder statement within 30 days after fiscal-year end. Public report and third-party standard/certification are optional articles/bylaws requirements; no state benefit filing. Assessment rule: Optional through articles/bylaws. Optional through articles/bylaws.", "difference": "Wisconsin: Annual; Optional / no mandate outside framework; no separate state benefit-report filing. No additional scored benefit-director/report-approval step applies to this private-company scope." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $25 per year on an annualized basis. Minimum tax/license used here: $0. Small active ordinary domestic C corporation with zero Wisconsin taxable net income and gross receipts from all activities below $4 million: $0 franchise/income tax and no economic-development surcharge. Excludes registry/report fees and other operating taxes.", "difference": "Wisconsin has a compared recurring floor of $25 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: 2/3 shares entitled vote. Entry/covered fundamental transaction requires 2/3 shares entitled to vote notwithstanding governing-document provisions, plus dissent rights. Exit deletes status statement under ordinary amendment rules; one-year wait before benefit reelection. For a newly formed corporation, the ordinary amendment default is votes favoring exceed votes opposing in each required voting group at a quorum meeting (180.0725/180.0726). If an amendment creates dissenters rights, 180.1003(3)(a) requires a majority of votes entitled to be cast by the affected voting group. The articles, authorized bylaws or board conditions can require more; pre-1973 corporations have transitional rules under 180.1706. Changing back: ordinary amendment: votes for exceed against with quorum, subject to voting groups/greater thresholds", "difference": "Wisconsin entry uses 2/3 shares entitled vote; exit uses ordinary amendment: votes for exceed against with quorum, subject to voting groups/greater thresholds. Easier entry helps adoption. Easier exit also scores higher here, although a mission-preservation priority may favor a harder exit." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "Directors shall consider listed stakeholders; charter priorities allowed. All benefit corporations must designate benefit director; chapter does not impose model independent-director requirement. Disclosure: Annual shareholder statement within 30 days after fiscal-year end. Public report and third-party standard/certification are optional articles/bylaws requirements; no state benefit filing. Enforcement: No dedicated percentage-threshold benefit-enforcement section in chapter 204. Ordinary derivative standing requires contemporaneous shareholder/beneficial-owner and adequate representation; no numeric floor.", "difference": "Wisconsin does not require public access in this compared variant. General-benefit mandate without mandatory third-party standard/public report." } } }, "guideUrl": "/assets/state-guides/WI.md" }, { "state": "Wyoming", "abbreviation": "WY", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "reviewed": "2026-10-11", "family": "no dedicated form identified", "features": { "purpose": { "summary": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ], "generalRequired": null, "specificRequired": null, "specificOptional": null }, "board": { "summary": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ], "mode": "ordinary_corporation" }, "standard": { "summary": "No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ], "thirdPartyRequired": null, "certificationRequired": null }, "report": { "summary": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ], "cadence": "not_applicable", "shareholders": null, "publicWebsite": null, "stateFiling": null, "public": null }, "enforcement": { "summary": "No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ], "shareholderThreshold": "No dedicated benefit proceeding" }, "benefitLiability": { "summary": "No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ], "corporationMissionDamagesBar": false, "directorMissionDamagesBar": false, "officerMissionDamagesBar": false }, "ordinaryExculpation": { "summary": "Director-only opt-in charter monetary limitation; exceptions include improper financial benefit, intentional harm, unlawful distributions and intentional criminal-law violations. Ordinary shareholder limited liability is separate.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "\u00a717-16-202(b)(iv)" } ], "director": true, "officer": false, "automatic": false }, "statusChange": { "summary": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ], "entryVote": "not_applicable", "exitVote": "not_applicable", "optionalLock": false } }, "costs": { "regularReport": { "amount": 60, "cadence": "annual", "conditions": "Annual combined report/license tax: greater of $60 or .0002 of assets located and employed in Wyoming; not two separate charges.", "summary": "Annual combined report/license tax: greater of $60 or .0002 of assets located and employed in Wyoming; not two separate charges.", "sources": [ { "url": "https://sos.wyo.gov/Business/docs/BusinessFees.pdf", "section": "Corporate report fees" } ] }, "benefitReport": { "amount": 0, "cadence": "none", "conditions": "No separate statutory benefit form/report identified.", "summary": "No separate statutory benefit form/report identified.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ] }, "minimumTax": { "amount": 0, "conditions": "Wyoming imposes no corporate income tax. Its annual corporate report already includes the asset-based license tax (minimum $60), so that charge is counted once. Operating-state taxes, sales/use, employment and local obligations depend on where and how the company works.", "summary": "Wyoming imposes no corporate income tax. Its annual corporate report already includes the asset-based license tax (minimum $60), so that charge is counted once. Operating-state taxes, sales/use, employment and local obligations depend on where and how the company works.", "sources": [ { "url": "https://www.wyo.gov/about-wyoming", "section": "No corporate income tax" }, { "label": "Wyoming SOS FAQ: annual reports, license-tax formula and $300,000 breakpoint", "url": "https://sos.wyo.gov/faqs.aspx?root=BUS", "checked": "2026-10-11", "section": "Wyoming SOS FAQ: annual reports, license-tax formula and $300,000 breakpoint" }, { "label": "Wyoming SOS annual-report worksheet: filing charge is the license tax", "url": "https://sos.wyo.gov/forms/business/general/arworksheet.pdf", "checked": "2026-10-11", "section": "Wyoming SOS annual-report worksheet: filing charge is the license tax" }, { "label": "State of Wyoming, About Wyoming: no corporate income tax", "url": "https://www.wyo.gov/about-wyoming", "checked": "2026-10-11", "section": "State of Wyoming, About Wyoming: no corporate income tax" } ] } }, "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" }, { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "\u00a717-16-202(b)(iv)" }, { "url": "https://sos.wyo.gov/Business/docs/BusinessFees.pdf", "section": "Corporate report fees" }, { "url": "https://www.wyo.gov/about-wyoming", "section": "No corporate income tax" }, { "label": "Wyoming SOS FAQ: annual reports, license-tax formula and $300,000 breakpoint", "url": "https://sos.wyo.gov/faqs.aspx?root=BUS", "checked": "2026-10-11", "section": "Wyoming SOS FAQ: annual reports, license-tax formula and $300,000 breakpoint" }, { "label": "Wyoming SOS annual-report worksheet: filing charge is the license tax", "url": "https://sos.wyo.gov/forms/business/general/arworksheet.pdf", "checked": "2026-10-11", "section": "Wyoming SOS annual-report worksheet: filing charge is the license tax" }, { "label": "State of Wyoming, About Wyoming: no corporate income tax", "url": "https://www.wyo.gov/about-wyoming", "checked": "2026-10-11", "section": "State of Wyoming, About Wyoming: no corporate income tax" } ], "differences": [ "Director-only opt-in charter monetary limitation; exceptions include improper financial benefit, intentional harm, unlawful distributions and intentional criminal-law violations. Ordinary shareholder limited liability is separate.", "Annual combined report/license tax: greater of $60 or .0002 of assets located and employed in Wyoming; not two separate charges.", "The form-availability gap is the only shared grouping; ordinary protections and charges differ." ], "gaps": [ "Ordinary charter protections concern specified internal monetary claims; personally committed wrongs and liabilities imposed by other statutes remain separate." ], "confidence": "Current fee source; official ordinary-code verification where stated", "sourceQualification": "", "effectiveNotes": [], "region": "parent", "scoring": { "components": { "form": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Dedicated legal form", "range": [ 0, 0 ], "reason": "No dedicated for-profit benefit form identified. This category measures fit with the requested benefit form.", "featureKeys": [ "purpose" ], "costKeys": [], "displayLabel": "Benefit company option", "why": "Wyoming has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason. A nonprofit public-benefit corporation is a different entity and does not fill this for-profit gap.", "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form." } ] }, "guards": { "range": [ 6, 6 ], "max": 25, "factors": [ { "label": "Ordinary director monetary protection", "range": [ 6, 6 ], "reason": "Identified director protection receives 6 points; retained exceptions and claim scope still apply.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for board members", "why": "Wyoming has an identified director monetary-protection provision in the compared scope, which earns this credit. Director-only opt-in charter monetary limitation; exceptions include improper financial benefit, intentional harm, unlawful distributions and intentional criminal-law violations. Ordinary shareholder limited liability is separate.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Ordinary officer monetary protection", "range": [ 0, 0 ], "reason": "No officer exculpation within this scored ordinary provision. Officer duties or indemnification are separate.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection for company officers", "why": "Wyoming does not extend the scored ordinary charter shield to officers acting only as officers, so no officer credit is awarded. Separate indemnification or insurance may still matter.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Automatic ordinary coverage", "range": [ 0, 0 ], "reason": "Protection requires an elected charter or other authorized provision; no default-coverage bonus.", "featureKeys": [ "ordinaryExculpation" ], "costKeys": [], "displayLabel": "Protection without extra setup", "why": "Wyoming requires an elected charter provision for the scored ordinary protection; it gets no automatic-coverage credit. The clause must actually be put in the charter to help.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Company mission-failure damages bar", "range": [ 0, 0 ], "reason": "No separately credited company mission-failure monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Protection when a benefit goal is missed", "why": "Wyoming has no separately credited benefit-specific monetary shield for company. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific director protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific director monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Board protection for benefit work", "why": "Wyoming has no separately credited benefit-specific monetary shield for directors. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." }, { "label": "Benefit-specific officer protection", "range": [ 0, 0 ], "reason": "No separately credited benefit-specific officer monetary bar.", "featureKeys": [ "benefitLiability" ], "costKeys": [], "displayLabel": "Officer protection for benefit work", "why": "Wyoming has no separately credited benefit-specific monetary shield for officers. No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ." } ] }, "reporting": { "range": [ 0, 0 ], "max": 25, "factors": [ { "label": "Benefit-report frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "How often reports are needed", "why": "Wyoming: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Assessment-standard flexibility", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "Choice of impact framework", "why": "Wyoming: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Separate state benefit filing", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Extra reports sent to the state", "why": "Wyoming: No dedicated form. No dedicated benefit form means this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." }, { "label": "Additional governance procedure", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board", "report" ], "costKeys": [], "displayLabel": "Extra board or approval steps", "why": "Wyoming has no dedicated benefit form, so this benefit-specific factor receives no credit.", "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification." } ] }, "fees": { "range": [ 12, 12 ], "max": 15, "factors": [ { "label": "Annualized registry-report charges", "range": [ 12, 12 ], "reason": "Ordinary reporting $60 + benefit filing $0 = $60 annualized. Fee bands: \u2264$50 \u219215; \u2264$100 \u219212; \u2264$200 \u21929; \u2264$300 \u21926; above $300 \u21923. Separate taxes, agents and other costs receive no points here.", "featureKeys": [], "costKeys": [ "regularReport", "benefitReport", "minimumTax" ], "displayLabel": "Yearly filings plus minimum state taxes", "why": "Wyoming has a compared recurring floor of $60 per year, including $0 in identified minimum tax/license charges. Ordinary domestic corporation with Wyoming assets no more than $300,000. $60 license tax is already counted in regularReport, so the additional tax component is $0. Variable asset excess, payment convenience fees and other operating taxes excluded. Lower recurring floors earn more cost credit. Profit/receipts-based taxes and local charges are additional; this is not the whole tax bill.", "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost." } ] }, "exit": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Default benefit-status entry vote", "range": [ 0, 0 ], "reason": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of becoming a benefit company", "why": "Wyoming: becoming a benefit company requires No dedicated for-profit benefit election applies. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." }, { "label": "Default benefit-status exit vote", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record. The model favors easier exit; mission permanence may instead be your priority. Optional locks are not assumed elected.", "featureKeys": [ "statusChange" ], "costKeys": [], "displayLabel": "Ease of changing status later", "why": "Wyoming: changing back requires not_applicable. There is no dedicated benefit status to elect or remove, so this factor receives no credit.", "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto." } ] }, "accountability": { "range": [ 0, 0 ], "max": 20, "factors": [ { "label": "Public benefit-report access", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Reports the public can read", "why": "Wyoming has no dedicated benefit-report rule in this ordinary form, so it receives no benefit-publication credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Reporting frequency", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "report" ], "costKeys": [], "displayLabel": "Regular updates on progress", "why": "Wyoming: No dedicated form. There is no benefit-report obligation for this ordinary form, and no benefit-form reporting credit.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory assessment standard", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "standard" ], "costKeys": [], "displayLabel": "An outside impact framework", "why": "Wyoming: No dedicated form. No dedicated benefit form means this benefit-specific factor is not applicable.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, { "label": "Mandatory mission duty", "range": [ 0, 0 ], "reason": "No dedicated benefit form: this requested-form category receives 0 points. Ordinary corporate rules remain in the legal record.", "featureKeys": [ "board" ], "costKeys": [], "displayLabel": "A duty to consider the mission", "why": "Wyoming has no mandatory benefit mission duty in the compared form, so it receives no mandatory-duty credit. No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute.", "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." } ] } }, "registryAnnualized": 60, "ordinaryScope": { "director": true, "officer": false, "automatic": false }, "exitCategory": "not_applicable", "specialProcedure": false, "variant": "New private stock corporation; optional mission lock not elected", "recurringMinimumAnnualized": 60, "minimumTaxAnnualized": 0, "entryCategory": "not_applicable" }, "grouping": { "assessment": "No dedicated form", "cadence": "No dedicated form", "filing": "No dedicated form", "ordinaryScope": "Director scope only", "exit": "No dedicated form" }, "scoreRange": [ 18, 18 ], "tax": { "code": "WY", "incomeSummary": "Wyoming has no corporate income tax. Its annual-report license tax is based on Wyoming assets, not net income: the greater of $60 or 0.0002 times assets located and employed in Wyoming.", "recurringSummary": "The $60 minimum annual-report license tax applies with Wyoming assets up to $300,000; larger Wyoming assets increase it. This is the same charge already represented by the annual-report fee, so adding another $60 tax would double-count it.", "formationAnnualTaxFloor": 0, "floorBasis": "Additional amount after excluding registry annual-report charges is $0. The corporation still owes the $60 minimum license tax through that annual report; this field is not total annual cost.", "scenarioMinimum": 0, "scenarioBasis": "Ordinary domestic corporation with Wyoming assets no more than $300,000. $60 license tax is already counted in regularReport, so the additional tax component is $0. Variable asset excess, payment convenience fees and other operating taxes excluded.", "operatingTaxCaution": "The license base uses assets located and employed in Wyoming. Operations, employees or sales in other states can create income and other tax nexus there despite Wyoming's lack of corporate income tax.", "sources": [ { "label": "Wyoming SOS FAQ: annual reports, license-tax formula and $300,000 breakpoint", "url": "https://sos.wyo.gov/faqs.aspx?root=BUS", "checked": "2026-10-11", "section": "Wyoming SOS FAQ: annual reports, license-tax formula and $300,000 breakpoint" }, { "label": "Wyoming SOS annual-report worksheet: filing charge is the license tax", "url": "https://sos.wyo.gov/forms/business/general/arworksheet.pdf", "checked": "2026-10-11", "section": "Wyoming SOS annual-report worksheet: filing charge is the license tax" }, { "label": "State of Wyoming, About Wyoming: no corporate income tax", "url": "https://www.wyo.gov/about-wyoming", "checked": "2026-10-11", "section": "State of Wyoming, About Wyoming: no corporate income tax" } ] }, "conversion": { "state": "Wyoming", "code": "WY", "form": "No dedicated for-profit benefit form identified", "status": "Gap", "group": "gap", "groupLabel": "Enact a benefit option", "entryVote": "No dedicated for-profit benefit election applies", "route": "No same-state benefit-status amendment route identified; a benefit chapter is needed. A move to another jurisdiction requires its own authorized domestication, conversion or merger route.", "currentDetail": "Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules.", "proposal": "Add an expressly for-profit benefit chapter and a same-company charter-amendment election; nonprofit public benefit terminology does not supply that option.", "sources": [ { "url": "https://wyoleg.gov/statutes/compress/title17.pdf", "section": "Title 17; nonprofit PBC is Chapter 19" } ] }, "scoreGuide": { "baseline": { "form": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "guards": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "reporting": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "fees": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "exit": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "accountability": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information." }, "areas": { "form": { "baseline": "The usual benefit-corporation model is a for-profit stock company with a public-benefit purpose. Washington uses a related social-purpose form; eight states have no identified dedicated for-profit benefit form.", "actual": "Mission can be stated in ordinary governing documents, but no dedicated for-profit benefit form was identified.", "difference": "Wyoming has ordinary for-profit corporations, but no dedicated for-profit benefit form in the reviewed law. It loses benefit-form credit for that specific reason." }, "guards": { "baseline": "The common starting point is a director protection clause that must be added to the charter. Many states do not extend that ordinary clause to officers. Exceptions, eligible people and covered claims differ.", "actual": "Director-only opt-in charter monetary limitation; exceptions include improper financial benefit, intentional harm, unlawful distributions and intentional criminal-law violations. Ordinary shareholder limited liability is separate. Benefit-specific rule: No benefit-specific immunity for failure to achieve a mission exists for this ordinary corporation. The ordinary director/officer rules below and any lawful indemnification or insurance apply on their own terms.", "difference": "Wyoming keeps this ordinary shield limited to directors; the charter must elect the ordinary protection. Director-only opt-in charter monetary limitation; exceptions include improper financial benefit, intentional harm, unlawful distributions and intentional criminal-law violations. Ordinary shareholder limited liability is separate." }, "reporting": { "baseline": "The most common benefit model requires an annual report using an outside assessment framework, without a separate state benefit-report filing. An outside framework does not necessarily mean paying for certification.", "actual": "No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Assessment rule: No statutory benefit-status third-party assessment or private certification mandate applies. The company may adopt voluntary standards or seek private B Corp certification separately.", "difference": "No benefit reporting credit applies because this state does not offer the requested form; that does not mean an ordinary company has no filings." }, "fees": { "baseline": "There is no uniform state charge. Compare the recurring report fee together with the minimum state tax or license charge for the stated small-company scenario. A low income-tax rate alone does not show this cost.", "actual": "Registry reporting: $60 per year on an annualized basis. Minimum tax/license used here: $0. Ordinary domestic corporation with Wyoming assets no more than $300,000. $60 license tax is already counted in regularReport, so the additional tax component is $0. Variable asset excess, payment convenience fees and other operating taxes excluded.", "difference": "Wyoming has a compared recurring floor of $60 per year, including $0 in identified minimum tax/license charges." }, "exit": { "baseline": "Two-thirds approval is the common benefit-status gate. Some states use ordinary amendment votes, some demand more, and class-by-class voting can give even a small share class a veto.", "actual": "Becoming a benefit company: No dedicated for-profit benefit election applies. Benefit-status entry, exit and permanent mission-lock provisions do not apply because no dedicated domestic for-profit form was identified. Ordinary amendments, mergers or conversion/qualification in another state use their own statutory rules. Changing back: not_applicable", "difference": "No direct benefit-status election or exit exists in this state; an interstate move or a law change is a different process." }, "accountability": { "baseline": "Annual reporting, public access, an outside assessment framework and a mandatory mission duty are common. Stronger disclosure can help people check promises while adding work or exposing owner information.", "actual": "No benefit-status stakeholder duty applies to this ordinary corporation. Its board follows ordinary corporate duties and its valid charter provisions; adding a mission statement does not create a benefit-corporation statute. Disclosure: No separate benefit-status annual report, shareholder benefit statement or public benefit assessment is required under a dedicated for-profit benefit statute. Ordinary corporate registry filings still apply at the charges shown below. Enforcement: No special benefit enforcement proceeding or benefit-specific shareholder percentage gate applies. Ordinary corporate and contractual claims remain available under their own standing rules.", "difference": "The ordinary corporation has no dedicated statutory benefit duty/report in this reviewed form. That is why it receives no benefit-accountability credit." } } }, "guideUrl": "/assets/state-guides/WY.md" } ] }