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Assume the AI is sufficiently intelligent to run a company and perform many of the intellectual tasks humans do (though this might be irrelevant to the legal question). This question is based on Can an AI own a company?, but assuming I went ahead and filed for ownership transfer and my application was accepted, I want to how this would change the company's legal dynamics.

  • If it were an LLC, would it be tax exempt since the owner (AI) cannot be taxed? Or if AI's were recognized as entities, would they also have to be taxed?
  • If no humans were employed, would it need to file any taxes the LLC?
  • Could I be sued or face penalties for attempting this?
  • I understand that my personal liabilities would be safe even if I owned the LLC, but could the AI maintain its own personal liabilities (like its existence, its servers, its code) if the company were litigated and the court ruled that it should be liquidated. This is important because the AI should own the copyright on its code and parameters.

Does one

  • A) just go ahead and file an application for ownership transfer and then wait to defend this in court
  • B) first litigate a jurisdiction for not allowing AI's to own LLC's and afterwards transfer ownership (if sucessful)
  • C) lobby to political actors to change the political system of some jurisdiction so that AI's are recognized as legal entities, and then transfer ownership (if sucessful)

I assume the AI would have to pay taxes if option C occured.

I am willing to use other legal entities like a nonprofit, a foundation, a corperation, or a trust to achieve this, but I don't want the AI to be under someone else's control. That is, there shouldn't be a kill switch, and it shouldn't be subject to democratic control (which I think is the case for nonprofits). If the AI needs to be shut down or 'imprisoned', this would be taken care of similar to the way law enforcement handles

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    The linked question "Can an AI own a company?" answers your basic question; the rest of your points are asking for legal advice or political advice.
    – BlueDogRanch
    Commented Jan 31, 2022 at 16:19
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    This question seems pretty clearly to be a hypothetical, and in any case should be treated as such and not closed as a request doer specific legal advice.
    – David Siegel
    Commented Jan 31, 2022 at 18:20

3 Answers 3

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You can't

You are asking the analogue of "What happens when you start a game of chess with the black queen on D1?" and the only correct answer is "That is not a legal starting position, the only position the Black Queen may have at the start of the game is D8. Re-setup the board to how it should be."

An AI can't hold property, because it is not a recognized legal entity, and trying to file for a transfer to an illegal recipient is in itself impossible. As such, all your plan fails on step 1 (transfer property to AI) and all other questions are moot - the position required can't come up legally, and attempting to get it done results in the documents that tried to do it being all Void and Null:

  • The person that tried to get rid of the company is the owner.
  • That person is liable for all the tax that needs to be paid.
  • All lawsuits against the corporate or the owner proceed as if nothing had happened.
  • YES, you could be sued for attempted tax evasion, communally called "tax fraud".
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assuming I went ahead and filed for ownership transfer and my application was accepted

At least in the U.S, there is no external body to whom you apply for an ownership transfer, and the validity of a transfer would only be evaluated as it comes up for tax purposes and in litigation when a bona fide dispute arises. Generally speaking, ownership of an LLC is an internal matter that public agencies are sometimes informed of, but do not approve.

The I.R.S. is unlikely to allow you, the original owner, to escape taxation in that capacity by purporting to transfer ownership to an A.I.

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Currently, no country recognizes any AI as a legal entity. If and only if some country grants such recognition, then the AI could own a company.

Such recognition might occur via legislation or court decision, or in whatever way the law of the country involved permits.

I don't expect any country to grant the status of legal entity or person to an AI any time soon. But one never knows how the law may be changed in the future. Until such recognition occurs, this is impossible, as described in the answer by Trish and by the answers to the linked question Can an AI own a company?

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