Does the description disclose side effects, auth requirements, rate limits, or destructive behavior?

Annotations already declare readOnlyHint=true, so the agent knows it's a safe read. The description adds that the return includes a complete checklist with time estimates and costs, providing behavioral context beyond the annotation. No contradictions.

Agents need to know what a tool does to the world before calling it. Descriptions should go beyond structured annotations to explain consequences.

Is the description appropriately sized, front-loaded, and free of redundancy?

The description is two sentences, both front-loaded and concise. Every sentence adds value: first states the main purpose, second expands on content. No wasted words.

Shorter descriptions cost fewer tokens and are easier for agents to parse. Every sentence should earn its place.

Given the tool's complexity, does the description cover enough for an agent to succeed on first attempt?

Given the tool has an output schema, the description need not detail return values. It covers the checklist's scope (categories) and key features (time estimates, costs). The information is sufficient for an agent to understand what the tool provides.

Complex tools with many parameters or behaviors need more documentation. Simple tools need less. This dimension scales expectations accordingly.

Does the description clarify parameter syntax, constraints, interactions, or defaults beyond what the schema provides?

Schema coverage is 100% with clear descriptions for both parameters (state and trade). The description does not add new parameter semantics beyond restating 'specific trade and state', so baseline 3 is appropriate.

Input schemas describe structure but not intent. Descriptions should explain non-obvious parameter relationships and valid value ranges.

Does the description clearly state what the tool does and how it differs from similar tools?

The description clearly states the tool returns a step-by-step business formation checklist for a given trade and state, listing included categories (ABN, GST, licensing, etc.) and mentioning time estimates and costs. This distinguishes it from siblings like formation.requirements or formation.guided_setup, which focus on specific aspects.

Agents choose between tools based on descriptions. A clear purpose with a specific verb and resource helps agents select the right tool.

Does the description explain when to use this tool, when not to, or what alternatives exist?

The description implies the tool should be used when a comprehensive checklist with time/costs is needed, but it does not explicitly state when not to use it or name alternative sibling tools. Usage guidelines are present but minimal.

Agents often have multiple tools that could apply. Explicit usage guidance like "use X instead of Y when Z" prevents misuse.