State law eases fees for startup companies

A new state law is expected to help startup companies save thousands of dollars in fees, the Wisconsin Economic Development Corp. says.

The law that took effect Friday consists of complex business-speak, but it basically boils down to this: Wisconsin early-stage companies that are certified as “Qualified New Business Ventures” and incorporated as “C” corporations in other states no longer must pay fees associated with filing certain business documents with the state.

The WEDC estimates that under the old law, the typical out-of-state company certified under the QNBV program paid about $7,500 in additional fees to the state of Wisconsin.

“The new law enables startups to spend that money on things like equipment or personnel to help grow their business,” the WEDC said in a statement.

Under the previous law, companies legally incorporated in other states had to pay fees associated with filing documents with the Wisconsin Department of Financial Institutions.

Many such companies are incorporated in Delaware but have significant operations or headquarters in Wisconsin.

Under the new law, those firms will be required to pay only a flat fee with the DFI.

To be certified as a Qualified New Business Venture and thereby qualify for the flat fee, a business must meet several conditions, including:

❚ Be headquartered in Wisconsin.

❚ Have at least 51 percent of its workers employed in Wisconsin.

❚ Have the potential of increasing jobs or capital investment in the state.

❚ Have fewer than 100 employees.

❚ Have been in operation in Wisconsin for 10 or fewer consecutive years.

QNBV status also allows investors in qualified startup and early-stage companies to receive a 25 percent state tax credit on the amount they invest in the business.

The new law is Wisconsin Act 156.