Suggestion for legal entity in creating a therapy private practice.
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Suggestion for legal entity in creating a therapy private practice.
Hello, I am seeking help in choosing the right type of business entity. I’m creating a
private practice to provide psychotherapy, I am a licensed clinical social worker.
Most things I’ve read so far seem to lean toward incorporating one way or another,
or maybe LLC. I do have separate practice liability insurance, but it seems as
though it’s a good idea to protect yourself liability wise by becoming incorporated.
My intention is to start with one client while I maintain my regular full time work,
and transition toward filling a caseload of enough clients for me to support myself
sufficiently. I do not intend on having a partner or employees at this time, but there
is potential for this in the future. I do plan to collaborate with other providers such
as psychiatrists, nutritionists, etc…. Advice is welcomed. Thank you.
Asked on February 10, 2019 under Business Law, California
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 5 years ago | Contributor
For a small business, an LLC is almost always the way to go:
1) It provides the same liabilty protection as a corporation does--that is, it protects your personal assets (e.g. house, savings) and you personally from most LLC-related debt or obligations. (There are excerptions: no protection is perfect.)
2) It involves less paperwork and formalities than a corporation.
3) It can be easily amended in the future to give an interest in the practice to a partner, but can be done in a way that lets you retain control.
4) You can elect "pass through" or "disregarded" or "partnership" tax treatment (an of these terms might be used) when you set it up, to avoid double "corporate" taxation.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.