State Business License Fee For NV Professional Corporations

© Neal A. Klegerman

Courtesy of Nevada Business Law Journal (nevadabusinesslawjournal.com)

Nevada Senate Bill 483 enacted a number of increases to business taxes and fees including a “commerce tax” on the gross revenues of certain Nevada businesses.

This article focuses only on the state business license fee which had been $200 annually for all Nevada entities.  For some reason the state business license fee was increased to $500 only for corporations whether big, small, Subchapter S, or otherwise.  As written, the statute does not raise the fees on professional corporations which are organized under NRS chapter 89. In relevant part the bill states as follows:

Sec. 75. NRS 76.130 is hereby amended to read as follows:

2. If the person applying for the renewal of a state business

license pursuant to subsection 1 is a corporation organized

pursuant to chapter 78, 78A or 78B of NRS, or a foreign

corporation required to file an initial or annual list with the

Secretary of State pursuant to chapter 80 of NRS, the fee for the

renewal of a state business license is $500.

From the plain meaning of the text, corporations organized pursuant to chapter 89, i.e., professional corporations, are not subject to the increased fee because chapter 89 is not referred to in the above text of the bill.  The Secretary of State’s Office initially issued a notice on June 11 to the effect that professional corporations would be subject to the increased $500 fee along with corporations organized under chapter 78 and the other chapters enumerated in the bill.  The confusion is understandable given that chapter 89 refers to chapter 78 for corporate filing fees (See, NRS 89.025) but these are simply the corporate filing fees.   The state business license fee is a separate fee which is under a separate chapter, chapter 76.  (By the way, the annual filing fees increased by $25 for all entities including professional corporations.)

We wish to commend the Secretary of State’s Office, particularly the Deputy Secretaries including Jeffery W. Landerfelt, Deputy Secretary for Commercial Recordings, with whom we communicated directly.  We certainly appreciate Mr. Landerfelt and his colleagues for being so open to the humble input of our law firm when we approached them on June 12 with our concerns about assessing the higher state business license fee on professional corporations.  The professionalism and courtesy are a credit not only to them but also to new Secretary of State Barbara Cegavske and her entire office.  Within a matter of days the Secretary of State’s office reconsidered the position and determined not to assess the higher state business license fee on professional corporations.  We understand that the Secretary of State’s office sought confirmation from the Legislative Counsel Bureau and the Nevada Attorney General’s office which confirmed the reconsidered result, so we express our gratitude to each of them as well.

It is certainly a sign of a finely functioning and business friendly state office that is willing to work with the private bar to reach the correct result on a matter.  We appreciate the excellent work and courtesy shown by the Secretary of State’s Office.

June 17, 2015

Neal A. Klegerman, the author of the article, is a corporate lawyer with more than 35 years of corporate law experience. Neal currently practices with the law firm of Emmel & Klegerman PC in Las Vegas, Nevada.

Please contact Neal for any questions or comments concerning this article.

Neal A. Klegerman
nklegerman@ekcounsel.com