Corporation bylaws are a fundamental aspect of any company structured as a corporation in Florida, as they provide the blueprint for how a corporation operates.
In this article, you will understand what the corporation bylaws are and why they are crucial to determining the success of any corporation established in Florida.
Florida Corporation Bylaws – Understanding the Concept
In essence, corporate bylaws are the rules by which corporations operate daily. The bylaws are generally adopted by the incorporators or the board of directors at the corporation’s first organizational meeting.
Additionally, it is possible to amend further provisions later, which is a common practice among businesses. The terms and provisions contained in the bylaws must abide with Florida law and comply with the company’s Articles of Incorporation.
Corporate Bylaws vs Articles of Incorporation – Explaining the Difference
The Articles of Incorporation are a set of documents filed with a government agency to legally document the creation of a corporation.
While the Articles of Incorporation encompass only the basic corporate structure, Florida law grants a high level of autonomy to determine its internal rules. Unlike Articles of Incorporation, corporate bylaws are not filed with the state, meaning they can be kept private.
Nevertheless, many public organizations make their bylaws available on their official website nowadays. Although the corporate bylaws are an internal document, there are many other corporate documents available for public access.
It is worth noting that you cannot form an anonymous corporation in Florida, so if you are concerned about keeping your information private, you may consider forming an LLC.
Is it Mandatory for Corporations to Have Corporate Bylaws?
Indeed, all corporations established in Florida must have corporate bylaws. Hence, when you structure a business as a corporation in Florida, you are required to write corporate bylaws.
However, it is crucial to sit down and take time to adequately tailor the provisions in the corporate bylaws, as it is a critical document to running a business smoothly.
Florida Corporation Bylaws – What Terms Must I Include in the Corporate Bylaws?
When it comes to drafting the corporation bylaws of a business, there is not a single set of requirements that fits all organizations.
In essence, the purpose of the corporate bylaws is to detail all working procedures of a corporation. While such provisions can differ by company, bylaws typically address the most important aspects of corporate operations.
As the corporate bylaws is the document that lays out the overall operating structure of a corporation, it can be extremely extensive and contain any number of provisions. Typically, the main provisions include:
- Corporation name and address
- The company’s mission, vision, and values
- Board composition – members, directors, and officers
- The board’s duties and responsibilities
- Amendment Process
- Voting requirements for election of board
- Schedule of meetings
- Process of board meetings and voting
- Identifying board members (schedules)
- Quorum requirements
- Notice requirements
- Classes of shares and characteristics (dividend preferences, voting rights, etc.)
- Shareholders’ rights (including voting rights)
- Amendment requirements
- Special allocations of authority
Florida Corporation Bylaws – Drafting the Document
Given that corporate bylaws are internal documents, they are not filed with any government agency.
In Florida, many corporations opt for purchasing a corporate bylaws kit. Each case is different, so the best approach is to work with an expert business attorney to assess your business needs and tailor the bylaws accordingly.
While drafting the document, the owners of the corporation must identify themselves by including their names and addresses in the corporate bylaws.
If the owner(s) do not establish ownership in the document, the company’s ownership may be called into question eventually. For instance, let us say a certain corporation in Florida is audited by the IRS (Internal Revenue Service).
In such a case, the IRS will ask to review the corporate bylaws to determine the shares of stock each shareholder owns, as well as the shareholders‘ percentage of profits and losses.
If the corporation does not have its bylaws in place, the IRS will proceed to determine who owns which assets and the amount of owed taxes. Nevertheless, there are ways to safeguard your identity while avoiding anonymity when establishing a corporation in Florida.
Do You Need to Draft Corporation Bylaws in Florida? – We Can Help You
Establishing and running a corporation in Florida is not an easy job. Accordingly, drafting the corporate bylaws is a complex and time-consuming task, which requires a professional approach.