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How to Form a Professional Corporation in California! (FAST SERVICE)


Are you a professional looking to start your own corporation?

As a Business Lawyer for Professionals, I’ve assisted hundreds of professionals just like you start their Professional Corporation quickly and correctly.

Bonus Material: Do you need more information about specific Incorporation requirements? We help professionals start their California Professional Corporation with our easy Done-For-You Professional Corporation Registration service. Email me at sam@mollaeilaw.com or book a FREE call to start your California Professional Corporation today here.

If you’re a professional in California, you SHOULD form a Professional Corporation taxed as an S-corporation!

If you’re a lawyer, doctor, dentist, accountant, acupuncturist, pharmacist, veterinarian, architect, optometrist, nurse, speech-language pathologist, audiologist, marriage and family therapist, psychiatrist, or psychologist in California, you’re prohibited from registering your business as an LLC, PLLC or a traditional Corporation. Instead should register as a Professional Corporation taxed as an S-Corporation.

Each specific profession in California has special requirements when forming a Professional Corporation.

If done incorrectly, your Professional Corporation can be rejected by the Secretary of State, leaving you vulnerable to potential lawsuits and fines from various government agencies. You may even face discipline from your state’s professional regulatory board.

On this page, I will help you understand what a California Professional Corporation is and give you a step-by-step guide as to how to start your own Professional Corporation.

We help professionals start their California Professional Corporation with our easy Done-For-You Professional Corporation Registration Service. Email me at sam@mollaeilaw.com or book a FREE call to start your California Professional Corporation today here.

 

What is a California Professional Corporation?

A Professional Corporation is a special type of corporation that professionals form to provide professional services in California, instead of the traditional LLC or traditional corporation.

California professional corporations can be formed only to provide PROFESSIONAL services within a single profession, according to the Moscone-Knox Professional Corporation Act.

A professional service is defined as any service that requires a license issued by a California state regulatory licensing board, state court, or a similar agency.

Professions that are required to be professional corporations include many of those that must have a state license, such as doctors, dentists, lawyers, accountants, pharmacists, veterinarians, optometrists, marriage and family therapists, nurses, audiologists, architects, psychiatrists, and psychologists.

Email me at sam@mollaeilaw.com to confirm that your profession falls under the requirements of a professional corporation.

Why Should My Professional Corporation Be Taxed as an S-Corporation?

If you don’t elect to have your Professional Corporation taxed as an S-Corporation, the default status for it is to be taxed as a C-Corporation. You don’t want to be taxed as a C-Corporation because your corporation would pay federal taxes on its profits and you would also pay individual taxes if you receive a salary, bonuses, or dividends from the corporation.

By electing to be taxed as an S-Corporation, your Professional Corporation would instead be a pass-through tax entity, like an LLC or a partnership, which allows you to pass losses from the business to your income tax return. You can use the losses to offset income that you may have from other sources.

Also, you will NOT be required to pay self-employment taxes on any additional corporate profits that are paid to you as dividends as a shareholder in addition to your reasonable salary.

So if you’re a professional, you SHOULD elect to have your corporation to be taxed as an S-Corporation. More on this below….

 

Requirements of a California Professional Corporation

Requirements of a California Professional Corporation

California Business and Professions Code require that only LICENSED persons can be shareholders of a professional corporation.

Unless an exception applies, a shareholder must be licensed in the profession that the professional corporation is engaged in.

 

Name Requirements of California Professional Corporation

Often, I receive phone calls or emails from professionals, just like yourself, who’s corporations have been rejected by the Secretary of State due to a mistake with it’s name.

California Professional Corporations have very strict name requirements for each specific profession.

The name of a professional corporation in California must comply with rules governing the profession and any name requirements issued by the licensing agency for that profession.

Firstly, the name of the professional corporation was also be DISTINGUISHABLE from the name of any other business entity on file with the California Secretary of State which you can search for here: https://businesssearch.sos.ca.gov

If you plan on trademarking the name of your business, you should conduct a thorough trademark search to make sure your name is available in your geographic area.

Secondly, each specific profession will have its own name requirement, such as including specific words. For example, the name of the California professional corporation for psychologists must include the word “psychology,” “psychological,” “psychologist,” “psychology consultation,” “psychology consultant,” “psychometry,” “psychometrics” or “psychometrist,” “psychotherapy,” “psychotherapist,” “psychoanalysis,” or “psychoanalyst.”

Thirdly, each specific profession will have special suffix requirements, psychology will accept “P.C.” as the corporate ending.

Email me at sam@mollaeilaw.com to confirm what the name requirements are for your profession before you register you professional corporation.

 

Which Professions Need to Form a California Professional Corporation?

The following professions need to form a Professional Corporation in California:

If you’re a professional and you earned a degree from any of the following graduate school, then you need to form a Professional Corporation:

 

Can a Professional Corporation Be an S Corporation?

Can a Professional Corporation Be an S Corporation

A professional corporation can and SHOULD be an S Corporation.

S Corporation is a special type of corporation that’s designed to avoid the double taxation disadvantages of regular C corps. S corps allow profits, and some losses, to be passed through directly to owners’ personal income without ever being subject to corporate tax rates.

S Corporation is great for self-employed professionals in California.

With an S Corp for your professional corporation, you should be able to avoid self-employment tax which save you usually around 15.3% of your income.

If you have a business that generates a nice profit over and above what you would consider reasonable compensation for the services that the owners provide, you may be unnecessarily subjecting the profits to self employment taxes.

Here is a scenario that seems to help clarify things:

Maria is a sole proprietor bringing in sales of $90,000. After she pays her costs & expenses, her profit is $60,000. As a sole proprietor, she is required to pay self- employment tax of 15.3% on this entire $60K of profit, which equates to $9,180.

Now, let’s assume Maria formed an S-Corporation for her business, and chooses to pay herself $35K for the year in salary, and take the remaining $25K of profit through a distribution. She still earns the same $60K in profit. But, let’s look at the tax situation. Because corporations only pay Social Security & Medicare taxes on salaries, she’s only liable for $5,355, saving over $3,800 in taxes.

You SHOULD have a business lawyer properly prepare and file your Form 2553 with the IRS to make sure it’s filed correctly and timely in order to get taxed as an S Corporation for your professional corporation.

Unless you make this tax election and properly file the paperwork, your professional corporation will be taxed as a C Corporation by default, which you DEFINITELY want to avoid at all costs.

Email me at sam@mollaeilaw.com if you have any questions about the S-Corp election process.

 

Advantages of a California S Corporation for Professional Corporations

By having S Corporation tax election for your California Professional Corporation, you will be enjoy the following advantages:

  • Avoiding self-employment tax which could save you around 15.3% of your income
  • Avoiding double taxation
  • Being taxed as a pass-through entity like an LLC
  • The ability to pass losses from the business to offset your personal income tax liability

If you’re unsure about whether your professional corporation should make the S Corporation election, contact me at sam@mollaeilaw.com

so I can walk you through the advantages and disadvantages.

 

Can I Form an LLC For My Professional Business?

Can I Form an LLC For My Professional Business

While most states allow for professionals to open up Professional LLC (PLLCs) to practice their professions, California is one of the only states which does NOT allow licensed professionals to form any kind of limited liability company (LLC) to practice their professions.

Under the California Revised Uniform Limited Liability Company Act, if you provide professional services, you must register your company as a Professional Corporation or a Limited Liability.

 

Can I Form A Professional Corporation If Am A Disqualified Person?

A Disqualified Person is a licensed person who has become legally disqualified from conducting professional services.

If you had your license but have since become disqualified, you are not able to create a professional corporation or remain as a director, officer or shareholder of a professional corporation.

 

Your 10 Step Guide to Start Your California Professional Corporation

Step 1: Define Your Corporation

Let’s start with the basics. 

Before submitting any documents, the first questions that naturally come to mind are: 

  • What type of legal entity my professional corporation will be considered as?
  • What is the tax regime for the said entity in the state of California? 

This is an important piece of information that will impact the rentability and profits of your future company.

So, let’s clear that up.

While most states allow for professionals to open up Professional LLC (PLLCs), California is one of the few states that does NOT allow licensed professionals to form any kind of limited liability company (LLC) to practice their professions.

Under the California Revised Uniform Limited Liability Company Act, you are required to register your company as a Professional Corporation for you to be able to provide any professional service.

What about professional corporation taxation requirements? C-Corp or S-Corp?

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By default, your professional corporation will be taxed as a C-Corp, which is definitely something that you want to avoid

Alternatively, you have the possibility to opt for a tax election that allows your company to be taxed as an S-Corporation (S-Corp) instead. 

An S-Corporation is a special type of corporation that is designed to avoid the double taxation disadvantages of regular C-Corps. 

S-Corps allow profits and some losses to be passed through directly to owners’ personal income without ever being subject to corporate tax rates.

This is what makes them a great choice for self-employed professionals in California.

By adopting the tax regime of an S-Corp, you will be able to avoid unnecessarily subjecting yourself to self-employment taxes, which, in turn, saves you around 15.3% of your income.

Here is a real-life example of how the math works:

  • Let’s assume that Jannet is a sole proprietor who makes  $90,000 by providing accounting services.
  • After she pays her costs & expenses, her profit is $60,000. 
  • As a sole proprietor, she is required to pay self-employment tax of 15.3% on this entire $60K of profit, which equates to $9,180.

However, what if Jannet formed an S-Corp instead?

  • Out of the $60k profit, she chooses to pay herself $35K for the year in salary and takes the remaining $25K of profit through a distribution.

So, how does her tax situation look like now? 

  • This time she is only liable for $5,355 since corporations are required to pay Medicare and Social Security taxes only on salaries.
  • Therefore, she saved over $3,800 in taxes.
Bonus Material: Would you like some more clarifications about how everything works? Email me at sam@mollaeilaw.com and I will explain all you need to know about correctly starting your Professional Corporation.

 

The advantages of being taxed as an S-Corp are not reduced only to avoiding the self-employment tax of 15.3%. Here are some more advantages of electing your Professional Corporation to be taxed as an S-Corporation:

  • Preventing double taxation;
  • Being taxed as a pass-through entity like an LLC;
  • The ability to pass losses from the business to offset your personal income tax liability.

Your Professional Corporation can and should be an S-Corporation. This is done by filing Form 2553 with the IRS. 

To ensure that all the documentation and paperwork is filed correctly and timely the first time, we advise getting a business lawyer to facilitate the process and answer all the questions that might appear along the way.

Now that we settled that matter, let’s continue with the basics. 

Your company needs an identity. What do we mean by that? Well, first, you need a name, an address, a place where people can find you and a clearly stated purpose for your business.

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In order to do this, you have to file the necessary Articles of Incorporation with the California State Secretary. You will have to offer details about your company’s name, business address, name, address of service of process, number of shares and purpose statement. 

There are strict requirements for each of these categories, depending on the professional service your corporation specializes in, such as law, accounting, dentistry and so on, and failing to comply may result in fines or your Incorporation being rejected. 

Let’s take the California professional corporation name requirements as an example to better illustrate the situation:

For each specific specialty, California Professional Corporations have very severe name criteria. In California, a professional corporation’s name must comply with the profession-specific rules as well as any name limitations imposed by the licensing agency for that profession. Let’s expand on that a bit:

  • Firstly, the name of the professional corporation must be distinguishable from the name of any other business entity on file with the California Secretary of State. You can check on that here
  • Secondly, each specific profession will have its own name requirement, such as including specific words.
  • For example, the name of the California professional corporation for psychologists must include the word “psychology,” “psychological,” “psychologist,” “psychology consultation,” and so on.
  • Thirdly, each specific profession will have special suffix requirements, psychology will accept “P.C.” as the corporate ending.
Bonus Material: Do you need more information about specific Incorporation requirements? We help professionals start their California Professional Corporation with our easy Done-For-You Professional Corporation Registration service. Email me at sam@mollaeilaw.com or book a FREE call to start your California Professional Corporation today here.

Step 2: Appoint Your Directors

We talked about the identity of your corporation, now let’s talk about the people in charge.

It is time to hold your first board meeting and appoint the directors of your professional corporation.

At the meeting, the board of directors can adopt bylaws, appoint corporate officers, authorize the issuance of stock, adopt an official stock certificate form and corporate seal, establish the professional corporation’s fiscal year, and so on. These decisions will be documented in corporate minutes.

So, how many directors must be appointed?

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Any California Professional Corporation must have at least 3 directors on their board, unless the corporation has less than 3 shareholders, in which case, the number of directors must not be less than the number of shareholders. 

The California Corporations Code section 13403 provides more details on that.

If you have only one shareholder, that shareholder can also be the only director and can also serve as the president and treasurer of the corporation. It is also important to mention that in order to be appointed as an officer or director of a professional corporation, the individual must be licensed to conduct the professional activity that the corporation is engaging in.

Step 3: Draft Corporate Bylaws

Now that you have set the foundation on what the purpose of your professional corporation is and what the corporation does, it is time to define the how.

In this step you need to set in place your corporate bylaws, which are rules that define the day-to-day operations of your company, addressing issues such as the size of the board of directors, how the board of directors functions, the method and term of their election, the existence of corporate offices, how and when shareholder meetings are held, what happens if the corporation gets dissolved and so on. 

Corporate bylaws are the nervous system of your company. They are not only necessary for establishing the internal rules and procedures but also proving your company’s legitimacy in front of other institutions such as the IRS, banks, and other key stakeholders.

More times than not, Professional Corporations are required to use specific language in their bylaws and abide by certain criteria and standards. This is why it’s important to seek the advice of a business lawyer to draft those laws in order to make sure everything is covered from the start, but also to prevent any future conflicts and discrepancies. 

Step 4: Get Your EIN

And we are back to taxes!

Much like a Social Security number, an EIN (Employer Identification Number), also commonly known as Tax ID, is a reference number that is unique to your company.

You will require an EIN for various things such as:

  • Hiring employees;
  • Filing federal taxes;
  • Applying for local permits or licenses;
  • Applying for loans or federal financial assistance programs.

This process can be done online, by fax or by post provided you have a Social Security Number. You can find more information on the IRS website here

Bonus Material: You don’t have a Social Security Number (SSN), but would like to apply for your EIN, you can email me at sam@mollaeilaw.com and we can help you solve this problem.

Step 5: File a Statement of Information

Hang in there! We are almost done.

There is just a bit more paperwork to do. This one is a little more specific.

Filing a statement of Information is an additional requirement for Professional Corporations in California. It ensures that your company remains compliant and that your contact information is up-to-date. 

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When it comes to your Statement of Information, you have to be careful with the deadlines and remember to resubmit it yearly. 

California Professional Corporations must file a State of Information within the first 90 days of registration. Then, file it every year before the end of the calendar month of the original registration date or immediately if there are any changes to your Registered Agent address or business address.

The process can be done online using this link.

Step 6: File Form 2553 for S-Corporation Tax Election

With everything else in order and with the legal form of your corporation decided, it is time to file for its election.

In order for your professional corporation to receive the tax treatment of an S-Corp, you must file an election with the IRS using Form 2553, which must be filed within the first two months and fifteen days of the beginning of the tax year in which the election is meant to take effect. Otherwise, your election will only be effective only from the next tax year

It is advised to have an attorney help you with this step. 

We help professionals start their California Professional Corporation with our easy Done-For-You Professional Corporation Registration service. Email me at sam@mollaeilaw.com or book a FREE call to start your California Professional Corporation today here.

Bonus Material: You can read more about this topic here.

Step 7: Pay Your Taxes and Fees to the California Franchise Board

In the state of California, professional corporations are required to pay a minimum annual tax of $800 to the California Franchise Tax Board. 

This tax is a “prepay” tax, meaning that it pays for the current year.

It is due during the first quarter of each accounting year, regardless of whether the corporation is inactive, operating at a loss or does not do any business at all in California.

Your first payment for the Franchise Tax is due by the 15th day of the 4th month after your professional corporation is filed. Then, every year after your first payment, your Franchise Tax is due by April 15th and failing to pay before the deadline can have serious consequences. 

We strongly advise you to hire an accountant that can make sure that everything is in order. You can also contact the California Franchise Tax Board (FTB) if you have any questions regarding taxation.

Bonus Material: Consult the FTB website for more information. 

Step 8: Register With the EDD

Do you plan on hiring any employees?

 

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If your answer is affirmative, you must register as an employer with the California Employment Development Department (EDD).

Any Professional Corporation from California is subject to pay California’s payroll tax even if the corporation only has a president and there are no other employees and if that office is being paid more than $100.

You can register for your EDD payroll tax account number here.

 

9. Apply for Local Business Registration and Licenses

Once again, we are getting more and more specific.

You have complied with the California Secretary of State to form your professional corporation. Next, you need to make sure you’re registered with the city or county where you’re operating your business.

Moreover, make sure you possess all the federal and local permits to operate legally, the requirements for which can of course vary, depending on where your business is located and what type your service your Professional Corporation offers.

Bonus Material: Email me at sam@mollaeilaw.com or contact us here and we can help you make sure that all the specific requirements are met.

10. MORE LEGAL PAPERWORK! (or maybe not…)

We know that all of this may seem rather confusing and complicated, and oftentimes it is easy to get lost in the paperwork and deadline.

Every day I get another phone call from an upset client begging me to help correct their misfiled corporation. 

DON’T LET THIS BE YOU! 

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You can either take the complicated, time-consuming steps detailed in this article to properly form your California Professional Corporation yourself, or you can hire me to make sure you’re doing everything correctly.

As a Business Lawyer for Professionals, I’ve assisted hundreds of professionals just like you start their California Professional Corporation, and I can definitely help you start yours.

All you have to do is: sit back, relax, focus on your passion and let us take care of everything for you.

Bonus Material: We help professionals start their California Professional Corporation with our easy Done-For-You Professional Corporation Registration service. Email me at sam@mollaeilaw.com or book a FREE call to start your California Professional Corporation today here.

 

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Now It’s Your Turn to Try It!

Put your expertise out there and let us handle the legal stuff.

Start your professional corporation in California today!

Want Me And My Team To Help You Start Your Own Professional Corporation in California as Quick and Easy as Possible? 

What you need to be successful:

  1. Residency in the state of California: This guide is aimed at professionals that are trying to start a professional corporation in this state. If you are not a California resident, there might be better alternatives for you. For example, if you are an immigrant aiming to start a business in the US, Wyoming would be a better location for you to consider.
  1. Be a licensed professional: There are certain regulations that professionals such as dentists, lawyers, pharmacists, or accountants have to comply with in order to start their own corporation in the state of California.  This guide is designed with exactly that in mind. 
  1. Openness to collaborate: We will provide you with the necessary knowledge and the steps that have to be taken, but we are not in this alone. You will have to offer us the information we need in order to facilitate this process for you.

If you meet the above criteria and are serious about starting your own professional corporation in California, contact us here to start your professional corporation today! 

We have helped thousands of professionals just like you start their California Professional Corporation with our easy Done-For-You Professional Corporation Registration service and we can certainly help you as well. Email me at sam@mollaeilaw.com or book a FREE call to start your California Professional Corporation today here.

Law Corporation for Lawyers and Attorneys

Law Corporation for Lawyers and Attorneys

If you’re a lawyer or attorney in California, you SHOULD form a Professional Law Corporation.

A California professional law corporation must follow the rules of the California State Bar and the California Rules of Professional Conduct.

The professional law corporation’s name must include a corporate ending such as: “A Professional Corporation” “A Professional Law Corporation” “Professional Corporation” “Professional Law Corporation” “Law Corporation” “APC” “A.P.C.” “PC” “P.C.” “Prof. Corp.” “A Professional Legal Corporation” “Professional Legal Corporation” “A Legal Corporation” “Inc.” “Incorporated” “Corporation” “A California Professional Corporation” “L.C.” “Ltd.” “Limited” “P.A.” and “Professional Association”.

The professional law corporation’s name cannot include “APLC” “PLC” or “LLC” as its corporate endings.

The name of your law corporation in State Bar records (and on file with the Secretary of State) is the only name under which it may practice law.

The professional corporation must also state within its Articles of Incorporation that its purpose is “law.”

After you form a professional law corporation, you must register the entity with the State Bar of California by providing the State Bar with original proof of your Articles of Incorporation from the Secretary of State.

Learn more about Law Professional Corporation here.

Dental Corporation for Dentists

If you’re a dentist in California, you SHOULD form a Dentistry Professional Corporation.

To open a professional dental corporation, you must be licensed by the Dental Board of California.

The name of the dental professional corporation must contain the name or the last name of one or more of the present, prospective, or former shareholder and must include the words “dental corporation” “Professional Corporation” “Prof. Corp.” “Corporation” “Corp.” “Incorporated” or “Inc.”

If you will be opening your professional dental corporation under a fictitious name, you must file a fictitious business name statement in the county which you will be seeing patients as well as the California Dental Board.

Learn more about a Dental Professional Corporation here.

Medical Corporation for Doctors and Physicians

If you’re a doctor or physician in California, you SHOULD form a Professional Medical Corporation.

To open a professional medical corporation, you must be licensed by the Medical Board of California.

In a professional medical corporation, at least 51% of the shares must be owned by a licensed physician or surgeon. Also, under the Business and Professions Code, physicians can only partner with other physicians, osteopaths, or podiatrists.

You must also get pre-approval from the Medical Board of California if you would like to use a fictitious business name, other than your name.

Learn more here about Medical Professional Corporation.

Accounting Corporation for Accountants

Accounting Corporation for Accountants

If you’re an accountant or CPA in California, you SHOULD form as an accountancy corporation.

You must also be approved for license by the California Board of Accountancy (CBA) to form a professional corporation.

The accounting corporation must also have at least one shareholder who has an active CPA or PA license.

The name on the Articles of Incorporation that are filed with the Secretary of State must match the name on the application submitted for licensing.

Learn more about Accountant Professional Corporation here.

Veterinarians Corporation for Veterinarians

If you’re a veterinarian in California, you SHOULD form a veterinary corporation.

Only a professional licensed to practice veterinary medicine can be a shareholder of a California professional veterinary corporation. But other licensed professionals can be officers, directors, or professional employees as long as the shares they own are not more than 49% of all shares in the corporation.

The veterinary corporation can pick any name permitted by the rules of the Veterinary Medical Board. The name of a veterinary professional corporation has to include the word veterinary and either “Corporation” “Corp.” “Incorporated” or “Inc.”

Learn more about Veterinary Professional Corporation here.

Pharmacy Corporation for Pharmacists

If you’re a pharmacist in California, you MUST form a pharmacy corporation.

The name of a pharmacy professional corporation and any name or names under it will open under must contain “pharmacist” “pharmacy” or “pharmaceutical” and wording or abbreviations which show that it is a corporation such as “Corporation” “Corp.” “Incorporated” or “Inc.”

Every shareholder, director, and officer of a pharmacy corporation, except an assistant secretary and an assistant treasurer, must be a licensed person as defined in Section 13401 of the Corporations Code.

Learn more about the professional corporation for pharmacists here.

Audiology Corporation for Audiologists

If you’re an audiologist in California, you MUST form an Audiology Corporation.

To be able to open your audiology corporation, you must be licensed by the Audiology Board.

The name of the professional audiology corporation must include “audiology” “audiologist” “audiological” “hearing clinic” “hearing clinician” “hearing therapist” or any similar name.

Learn more about Audiology Corporation here.

Chiropractic Corporation for Chiropractors

If you’re a chiropractor in California, you MUST form a chiropractic corporation.

Professional chiropractic corporations may NOT use fictitious names. The name of the professional chiropractic corporation must include “chiropractic”, the name or last name of one or more of the present, prospective, or former shareholders, and the word “corporation” or some other word denoting corporate existence.

Once the professional chiropractic corporation is formed, you must also submit a Certificate of Registration to the California Board of Chiropractic Examiners.

Learn more about Chiropractic Corporations here.

Optometric Corporation for Optometrists

If you’re an optometrist in California, you MUST form an optometric corporation.

The name for an optometric professional corporation must have the name of the optometrist who is the owner, or the name of at least one of them if there is more than one optometrist who owns it.

At least 51% of the shares of the optometric corporation must be owned by a licensed optometrist. The other 49% can be owned by physicians and surgeons, podiatrists, psychologists, registered nurses, marriage and family therapists, clinical social workers, physician assistants, chiropractors, acupuncturists, naturopathic doctors or any other licensed person.

Learn more about Optometric Corporation here.

Podiatry Corporation for Podiatrists

If you’re a podiatrist, you MUST form a Podiatry Corporation.

A Professional Podiatry Corporation is a professional corporation that is registered with the California Secretary of State, the Medical Board of California, and The American Board of Pediatrics.

The Professional Podiatry Corporation’s name must contain the name or the last name of one or more of the present, prospective, or former shareholders. It must also include a corporate ending such as: “Podiatry Corporation”, “Podiatry Corp.”, “Podiatrist”, “Doctor of Podiatric Medicine”, “D.P.M”, “A Professional Corporation”, “Professional Corporation”, “APC”, “A.P.C.” “PC”, “P.C.”, “Prof. Corp.”, “Inc.”, “Incorporated”, “Corporation”, “A California Professional Corporation” or words or abbreviations which denote its corporate existence.

Learn more about Podiatry Corporation here.

Physician Assistant Corporation for PA’s

If you’re a physician assistant PA, you MUST form a Physician Assistant Corporation.

Incorporating a Professional Physician Assistants Corporation in California will limit your liability against creditors and lawsuits, minimize the self-employment taxes of the shareholders, allow you to build corporate business credit, and much more.

The Professional Physician Assistants Corporation’s name must contain the words “physician assistant”. It must also include a corporate ending such as: “A Professional Corporation”, “Professional Corporation”, “APC”, “A.P.C.” “PC”, “P.C.”, “Prof. Corp.”, “Inc.”, “Incorporated”, “Corporation”, “A California Professional Corporation” or words or abbreviations which denote its corporate existence.

Learn more about Physician Assistant Corporation here.

Nursing Corporation for Nurses

If you’re a nurse in California, you MUST form a nursing corporation.

The name of the nursing professional corporation must include the words “nursing” or “registered nursing”. The name of a nursing professional corporation must also include a word or abbreviation which shows its corporate existence like “Corporation” “Corp.” “Incorporated” or “Inc.”

Professional nursing corporations may use a fictitious name so long as the words “nursing” or “registered nursing” is part of the name.

Learn more about Nursing Corporation here.

Speech-Language Pathologist Corporation

If you’re a speech-language pathologist in California, you MUST form a Speech-Language Pathology Corporation.

To form a professional corporation for speech-language pathology, you must first be licensed by the Speech-Language Pathology Board of California.

The name of the professional speech language pathology corporation must include “speech pathologist” “speech pathology” “speech therapy” “speech correction” “speech correctionist” “speech therapist” “speech clinic” “speech clinician” “language pathologist” “language pathology” “logopedics” “logopedist” “communicology” “communicologist” “aphasiologist” “voice therapy” “voice therapist” “voice pathology” “voice pathologist” “language therapist” “phoniatrist”, or any other similar titles.

Learn more about Speech-Language Pathology Corporation here.

Engineer Corporation for Engineers

If you’re an engineer in California, it is highly recommended that you create a professional engineering corporation.

While engineering practices are allowed to be LLCs in limited situations, it is more beneficial in the long run to create a professional corporation instead. There are many added benefits to incorporating as a professional engineering corporation such as limiting personal liability, obtaining business credit without a personal guarantee, and passing profits and losses to shareholders to avoid double taxation.

Engineering professional corporations have specific name requirements. If the name of the professional engineering corporation contains the name of a person, that person must be a licensed engineer, a licensed land surveyor, a licensed architect, or a registered geologist.

Professional engineering corporations are also allowed to use a Doing Business As (DBA) or a fictitious name.

Architectural Corporation for Architects

If you are an architect in California, it is highly suggested that you create a professional architectural corporation.

There are many added benefits to incorporating as a professional architectural corporation such as limiting personal liability, obtaining business credit without a personal guarantee, and passing profits and losses to shareholders to avoid double taxation.

The professional architectural corporation’s name must contain the name or the last name of one or more of the present, prospective, or former shareholders, or of someone who was associated with a predecessor person, partnership, or other organization and whose name or names appeared in the name of the predecessor organization.

Professional architectural corporation name must also include either the words “architectural corporation” or the word “architect” or “architects” and wording which shows corporate existence such as “Corporation” “Corp.” “Incorporated” or “Inc.”

California Professional Corporation for Physical Therapists

If you’re a physical therapist in California, you MUST form a professional physical therapy corporation.

Each shareholder, director and officer of a physical therapy corporation, except an assistant secretary and an assistant treasurer, has to be a licensed person defined in Section 13401 of the Corporations Code.

The name of a physical therapy professional corporation must contain the words “physical therapy” or “physical therapist” and any wording or abbreviations which show corporate existence such as “Corporation” “Corp.” “Incorporated” or “Inc.”

Marriage and Family Therapist Corporation

If you are a marriage or family therapist in California, you MUST open a marriage and family therapy corporation.

The name of a marriage and family therapy corporation has to contain one or more of the words “marriage” “family” or “child.” The name of a marriage and family therapy corporation must also contain one or more of the words “counseling” “counselor” “therapy” or “therapist”.

The licensed marriage and family therapist must also tell its clients at the beginning of treatment that it is doing business as a marriage and family corporation.

Learn more about Marriage and Family Therapy Corporation here.

California Clinical Social Worker Corporation

If you are a licensed clinical social worker in California, you MUST open a clinical social worker corporation.

The name of the licensed clinical social worker corporation must include the words “licensed clinical social worker.” The name of a licensed clinical social worker professional corporation must also include a word or abbreviation which shows its corporate existence like “Corporation” “Corp.” “Incorporated” or “Inc”.

If you plan on doing business under a fictitious name, you cannot use a name that is false, misleading or deceptive.

You must also tell your clients at the beginning of their treatment that the business is a licensed clinical social worker corporation.

Learn more about clinical social worker corporation here.

Psychology Corporation for Psychologists

If you are a psychologist in California, you MUST open a Psychology Corporation.

The name of the psychology professional corporation must include “psychology” “psychological” “psychologist” “psychology consultation” “psychology consultant” “psychometry” “psychometrics” “psychometrists” “psychotherapy” “psychotherapist” “psychoanalysis” or “psychoanalysts.”

The name of the psychology professional corporation must also include a word or abbreviation which shows its corporate existence like “Corporation” “Corp.” “Incorporated” or “Inc”.

You must also tell your clients at the beginning of their treatment that the business is a licensed clinical social worker corporation.

Learn more about Psychology Corporation here.

WHAT TO DO NEXT

If you’re a lawyer, doctor, dentist, accountant, pharmacist, veterinarian, architect, optometrist, nurse, speech-language pathologist, audiologist, dental hygienist, family therapist, psychiatrist, or psychologist, you probably don’t have the time to do all of the complicated above steps yourself to start your business.

While the 11 steps above give a basic overview of what is required to form the Professional Corporation, there are several complicated nuances that may affect the formation of your Professional Corporation.

Most problems that corporations run into in the long run are caused by mistakes in the formation stage of the professional corporation.

One of the best things you can do is to work with a business lawyer who can help you get started with your Professional Corporation without dealing with the legal headache of understanding the intricacies of properly filing your professional corporation.

If you’re interested in starting your Professional Corporation, email me at sam@mollaeilaw.com

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