How does licensing affect micro entity status eligibility?
How does licensing affect micro entity status eligibility?
Licensing can significantly impact an applicant’s eligibility for micro entity status. According to the MPEP:
“The applicant has not assigned, granted, or conveyed, nor is under an obligation by contract or law to assign, grant, or convey, a license or other ownership interest in the application concerned to an entity that, in the calendar year preceding the calendar year in which the applicable fee is being paid, had a gross income, as defined in section 61(a) of the Internal Revenue Code of 1986, exceeding 3 times the median household income for that preceding calendar year, as most recently reported by the Bureau of the Census.”
This means that if you’ve licensed or are obligated to license your application to a high-income entity (exceeding 3 times the median household income), you may not be eligible for micro entity status. It’s crucial to consider any existing or potential licensing agreements when determining your eligibility.
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