The USPTO offers significant fee discounts for small and micro entities. In particular, small entities include individuals, businesses with up to 500 employees, or non-profits.
Meanwhile, micro entities meet small entity requirements and have no more than four prior applications. Additionally, they must earn less than $241,830 per year. They also cannot assign or license inventions to entities exceeding that income limit.
As a result, small entities get a 60% reduction on most patent fees, while micro entities enjoy an 80% reduction.
However, these discounts sometimes lead applicants to claim small or micro status incorrectly. To address this, the USPTO now enforces penalties for false entity claims. Fines are at least three times the fees that should have been paid.
Furthermore, the Patent Office issues notices for payment deficiencies and sends orders to show cause why the fine shouldn’t apply.
For a related article: Do USPTO Fee Discounts Hurt Inventors’ Chances? Probably Not.