It takes a lot of planning, thoughtfulness, and attention to technical detail to become a 501(c)(3) public charity1. These organizations have applied for and received tax-exempt status under Section 501(c)(3) of the Internal Revenue Code (the “I.R.C.”) which means they are eligible for exemption from paying federal corporate income tax and are typically also eligible …
Small business and non-profits
Department of Labor Issues New Final Rule (2024) to Clarify Employee vs. Independent Contractor Status under FLSA
We previously wrote on the U.S. Department of Labor (DOL)’s 2021 rule publication regarding classification of employees and independent contractors in the context of gig workers. The DOL has again published a new final rule clarifying the test for determining the status of a worker as an employee or an independent contractor. For any business …
Factors for a Successful Business Succession through Worker Ownership
For a few years now, we have been hearing about the approach of a “silver tsunami.” For those unfamiliar with the term, it refers to the demographic phenomenon of an aging population, associated mostly with the large wave of retirement that the baby boomer generation is about to go through. With small businesses employing roughly …
Patagonia “Exits to Climate”: A Win for Capitalism, But a Mixed Bag for Stakeholder Governance
I, like most, was delighted to read the news that Patagonia’s shareholders decided to give away ownership of the company to benefit the climate and not private equity, a strategic buyer, or public capital markets. We’ve written extensively on mechanisms for mission protection in corporate entities. It appears that the Chouinard family, which owned …
Thoughts from a new economies’ attorney: distinguishing cooperative governing structure
In my previous posts, I discuss how traditional businesses and cooperatives diverge from a capital (and return on capital) point-of-view. Another common misconception is that cooperatives function like nonprofits, typically from the perspective of governance structure. They don’t. Cooperatives are businesses, and, as such, business principles and governance, and business governing structure apply to them. …
Mandatory Business Owner Reporting
The federal government has passed some new legislation that will require small businesses to report personal information about the business’s owners to a database controlled by the Securities Exchange Commission. The legislation is called the Corporate Transparency Act (the “Act”), adopted as Title LXIV (64) of the 2021 National Defense Authorization Act. The purpose of …
V-BLOG: BEYOND DEBT/EQUITY: HOW CAN WE HELP THE SOLIDARITY ECONOMY GROW?
Click here to view Jason Wiener’s recent webinar and learn more about alternative investment vehicles such as convertible notes, revenue-based financing, and guarantees.
A Leap forward for the Cooperative movement
As a cooperative attorney nothing is more exciting than stumbling on the odd article sharing a cooperative success story. Some days though, it’s more than the random, obscure news story, some days it’s an announcement that makes it feel like the movement is going mainstream. Today is one of those days. Today Evergreen Business Services …
Limited Cooperative Associations and Early Stage Financing
Cooperatives are the original social enterprise business model and Colorado is emerging as the “Delaware of cooperative law,” thanks in no small part to limited cooperative associations (LCAs), authorized by C.R.S. Title 7, Article 58. The limited cooperative association is a relatively new entity type, adopted in Colorado in 2010. It offers a balance of …
Leaving a Legacy: Creating a Social Enterprise that Outlives Its Founder
More and more, entrepreneurs and investors want more than just a buck: they want to create a business with a social mission, then preserve that entity’s mission through time. This blog post briefly discusses three ways to keep a business entity on purpose long after the founders have left. The first way is to borrow …
