Are they required in Iowa?
Yes, corporations are obligated by Iowa state law to institute their bylaws; however, unlike the articles of incorporation, corporate bylaws are internal documents that generally do not need to be filed with the state.[1]
Iowa Corporate Laws
- Corporate Tax: Iowa has a 5.5% tax on the net income of a corporation.[2]
- Board: Corporations must establish a board of directors because they must function under “the oversight” of this board.[3]
- Number – The bylaws determine the number of directors on the board as variable or fixed, but, at all times, it “shall consist of one or more individuals” consistent with the bylaws and the articles of incorporation.[4]
- Qualifications – Generally, the articles or bylaws detail attributes that qualify an individual as a director; however, at no point may the “past, prospective, or current action, or expression of opinion by a nominee or director” act as a disqualifier.[5]
- Terms – Each director’s term ends with the annual shareholder meeting; thus, even if a bylaws amendment forces a decrease in directors, it “does not shorten an incumbent director’s term.”[6]
- Staggered Terms – Directors may be divided into equal election groups of two or three so that directors are “elected for a term of two years or three years” (whichever is appropriate).[7]
- Fiduciary Duty – Corporate directors must keep their corporation’s ‘best interests’ in mind whenever performing their duties.[8]
- Meetings: The board of directors has meetings “in or out” of the state of Iowa while following the articles of incorporation and bylaw requirements in place.[9]
- Officers: The board of directors or bylaws designate the offices and officers that fill them but must assign an officer the duty of “maintaining and authenticating” corporate records.[10]
- Quorum: The bylaws can specifically impose the requirements for a quorum, but at no point shall a quorum be “less than one-third of the specified or fixed number of directors.”[11]
- Emergency Bylaws: The board of directors can institute a set of bylaws to use specifically during state-wide emergencies, such as procedures for the “designation of additional or substitute directors.”[12]