What criteria must be met for a business to qualify for corporate status?

For a business to qualify for corporate status, it must be organized under state law and issue stock. This is essential because corporate status is primarily defined by legal recognition under applicable state statutes, which allows the business to operate as a separate legal entity from its owners. When a business organizes as a corporation, it typically must file articles of incorporation with the state and adhere to specific regulatory requirements. The issuance of stock is a fundamental characteristic of corporations, as it represents ownership in the company and allows for the raising of capital through investors.

The other criteria mentioned, such as having employees, issuing bonds, or taking out loans, while common among businesses, do not specifically define corporate status. A business can take different forms, such as partnerships or sole proprietorships, without the requirement of incorporating or issuing stock. Similarly, operating in multiple states or having a physical office is not necessary for a business to achieve corporate status; corporations can exist and be recognized even if they do not meet these conditions. The key determinant remains the organization under state law and the ability to issue stock.