Proposal 093: Implement stage 1 of legal/tax reconstruction of ReidarDAO

When: Immediately after the passing of the proposal

Context: Abraham, Mr. Fox, Bigmoondog, and BradChooseFi have spent the last month investigating legal/tax structures for the DAO. Our research and conversations with tax professionals have led us to believe that setting up a C Corporation based in the US wrapping the DAO is the optimal route forward.

Since many DAOs that seek to be legally compliant are structured as LLCs, this was one of the several entity structures we initially investigated. However, given that our membership is geographically diverse and not concentrated in the US, the costs and overhead associated with maintaining tax compliance make this structure unrealistic for the DAO at this point.

Thus, it is our opinion that a C Corp is the best path forward for the DAO.

The effect of this broadly speaking will be that each DAO member would be a shareholder of the C Corp proportionate to their ownership in the DAO, we would pay taxes at the corporate level, and the corporation would have a set of bylaws (similar to the DAO operating agreement) that delineates the rules of the DAO. As a result, actions that happen at the DAO level would also need to happen on the corporate level (e.g. removing a member in the DAO would also need to include removing them from the corporation).

The accounting firm we would use for the corporate setup and tax filings would be: https://atlasbusinessmanagement.com/

The cost to the DAO (annually) would be $3,000.00 & $25.00 per shareholder upon distribution (irrelevant for now).

Stage 1 would include authorizing Abraham, Mr. Fox, BigMoonDog, BradChooseFi, and any others that indicate their interest after the passage of this proposal (please only volunteer if you have a level of knowledge surrounding corporate entity formation etc as having too many people involved may make this less efficient) to begin the process of incorporation; drafting bylaws etc.

Stage 2 (pending a second proposal that would need to be approved) would certify the bylaws and actually incorporate the entity.

Why: A legal structure enhances protections for the DAO members.