Effective Social Enterprise - A Menu of Legal Structures
This article provides guidance to the social entrepreneur and attorneys about how to decide whether a new social enterprise should be structured within a tax-exempt or taxable legal entity, or whether a hybrid structure using both a taxable and an exempt entity is more appropriate. The first section presents a menu of legal structures potentially available to the social enterprise, eliminating those that are hardly ever practical.
Next, the author poses a series of questions to consider when making selections from the menu (with the help of a qualified attorney). Finally, the author provides a brief framework for analyzing the situation in order to suggest the most practical legal form under the circumstances.