Are you looking to set up a corporation in the state of Florida? If so, you will need to read up on the requirements for Florida corporate bylaws first. Unlike other business entities, corporations in Florida must have bylaws or a set of internal rules that govern their structure and operation. If you have no experience drafting bylaws, the process may seem daunting. However, the good news is that there is no standard way to write bylaws. As long as they do not violate Florida law or the corporation’s articles of incorporation, you are free to create your bylaws based on the unique needs of your business. With that in mind, let us take a closer look at what bylaws are and how to draft the best bylaws for your organization.
Table of Contents ToggleFlorida corporate bylaws are sets of rules governing how every corporation in the state is structured and managed on a day-to-day basis. The term “bylaws” may be somewhat misleading. They are not external laws set by the federal or state government but internal business documents that corporations create in-house to define how they will operate. You can think of bylaws as manuals or blueprints for running corporations. Florida corporate laws give businesses considerable leeway regarding the exact content of their bylaws. That said, bylaws typically include provisions on a corporation’s purpose and management structure; the rights and responsibilities of its directors, officers, and shareholders; procedural matters such as the times and locations of annual meetings; and various other affairs of the corporation.
People sometimes use the terms “corporate or corporation bylaws” and “corporation operating agreement” interchangeably, but these are two different things. Bylaws are the instruments that govern corporations. Corporation operating agreements are the instruments that govern limited liability companies or LLCs. To learn more about the differences between these business entities — and find out which one may be a better fit for your needs – read our articles on S Corp vs C Corp and LLC vs S Corp Florida differences.
The Florida Business Corporation Act requires all corporations in the state to have bylaws. Other than this, Florida corporation laws do not mandate what should be included in a corporation’s bylaws. You are free to insert any provision as long as it does not violate Florida law or the corporation’s articles of incorporation. Bylaws are typically adopted by the incorporators or board of directors. This is done at an organizational meeting after the articles of incorporation have been filed with the Florida Department of State, which is required to incorporate in Florida. In some cases, shareholders may also adopt bylaws if this power is reserved for them in the articles of incorporation. Once the bylaws are adopted, you must keep a copy at the corporation’s principal place of business but do not have to file them with the Division of Corporations or another government agency. There is no need to sign the bylaws either.
Like all corporations in Florida, non-profits must have bylaws and keep a copy at their principal place of business. However, they do not need to file them with the Division of Corporations. Non-profit bylaws in Florida also do not need to follow any specific format.
Florida’s bylaws requirements are not meant to make the lives of incorporators more difficult. By setting out important structural and procedural rules in advance, bylaws provide indispensable guidelines to a corporation’s management and are critical to running an organization smoothly, efficiently, and transparently.
Bylaws are particularly useful in emergencies or disputes between partners or shareholders of the corporation, such as when a party wants out of the business or does not honor its obligations. By laying out clear protocols to follow in various situations, bylaws can help resolve conflicts and even save the corporation from lawsuits.
Florida corporate laws do not require bylaws to include any specific provisions. There is no one-size-fits-all formula, and each corporation should draft its own bylaws that are unique to its purpose.
That said, it is standard practice for bylaws to contain the following information at a minimum:
Note that it is essential to include the names and addresses of the corporation’s owners. If you fail to do so, the company ownership may be called into question later.
For instance, if the IRS audits the corporation, it will likely examine its bylaws to find out how many shares of stock are owned by each shareholder, including their respective profits and losses. If the bylaws do not provide this information, the IRS will make its own determination of who owns what and how much tax they owe – and this determination may be to your disadvantage.
Depending on the nature of your organization, bylaws can be a very complex document that requires a considerable amount of time and expertise to draft properly. A single mistake or omission can have serious legal and tax repercussions.
To save yourself time, money, and future legal trouble, contact the Cueto Law Group today and have one of our corporate law attorneys draft your bylaws. We will make sure that your bylaws include all essential provisions so that you can focus on running your business stress-free.
To get a better idea of what to include in your bylaws, check out our downloadable templates below. These include sample Florida bylaws for a profit corporation, as well as a Florida corporate bylaws form for a non-profit.
However, note that these are intended as examples only and may not be appropriate for your organization. You should always speak with a corporate law attorney before drafting your bylaws.
