When you are starting a Professional Psychological Corp, you might have tons of questions in your mind.
Yes, the starting steps are the most tedious and time-consuming. One wrong step or decision can make you pay tons of fines.
Now, can a psychologist have an LLC in CA? The short answer is no! A Psychological Corporation can not operate as an LLC in CA.
According to California Corporations Code, there is no LLC certification to practice psychology.
Want to know what business form you should choose? Well, if you are looking for an in-depth answer, you can get that by reading through this!
What Business Type Should You Choose for Practicing Psychology?
If you are a psychologist, you do not have any option other than forming an S-Corporation. You should create a corporation taxed as an S Corp.
Basically, as a psychologist, you are prohibited from operating like a traditional corporation or an LLC. Instead, you will need to opt for a Professional Corporation.
However, many professionals struggle to form S Corp. And you should know that if you do not create the professional corp correctly, you will get a rejection by the Secretary of State.
That will leave you and your organization vulnerable to loads of fines and lawsuits.
But who will chase after you with these fines and lawsuits? As you might have guessed, the fines and cases will come from different governmental agencies.
In fact, the California State Board might issue penalties and lawsuits. And if you fall into such a scenario, it will be hard for you to get out.
What Is A Psychology Corporation?
At its core, Psychological Professional Corp is a professional corporation that is registered with the CA Secretary of the State. It will also have registration from the California Board of Psychology.
The thing about operating a professional corp is that it must have professional registration documentation.
And all professional corps need to register with the corresponding agency of the government. Each agency is tasked with managing its category.
That said, as a Professional Psychological Corp, you should also hold the certification of registration from the Board of Psychology in California.
Again, you and your organization will be vulnerable without these, making you go through many hassles.
How to Start A Professional Psychological Corp in California
Basically, you just need to form the psychological corporation in California correctly to secure your organization. And to do so, you should follow these steps:
Step 1: File Articles
Before anything else, you must file Articles of Incorporation of a Professional Corp with the Secretary of State. Without filing these articles, you will not be capable of legally forming the Professional Corporation.
Step 2: Notify The State Agency
After filing the required articles, you should notify the state agency of your profession, the Psychology govt agency. You must ensure that the agency you report to is tasked with managing your profession.
Step 3: Carry Out Other Required Tasks
Once you have notified the state agency of your profession, you need to hold a Board of Director meeting, get your Professional Corporation Bylaws drafted, and appoint directors. Then, apply for the EIN, file Form 2553 for the S-Corp tax, and file the Statement of Information.
But that is not all; you should also pay corporate taxes to the CA Franchise Tax Board. And if you are hiring employees, you should register with the EDD and get the local business licenses and registration.
If you carry out all of these correctly, you will not need to worry about any issues with your professional organization.
So, can a psychologist have an LLC in CA? No! If you are a psychologist, you can not operate as an LLC in California. Instead, you need to practice your profession as an S Corporation.
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