Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

Full Bio →

Written by

UPDATED: Jun 19, 2018

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about legal topics and insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.

Professional Corporations (PCs), also known as professional service corporations, were created to allow certain kinds of professionals such as doctors, lawyers, accountants, or engineers to do business as a professional corporation.

Benefits of a Professional Corporation

Professional corporations are different from corporations because all shareholders in a professional corporation must be members of the same profession involved in the same business. For example, a group of doctors can form a professional corporation if their business is to practice medicine. While there is some limitation on liability surrounding the actions of each partner, the professionals in the firm may not be relieved of liability for their own professional negligence or malpractice. This is the main reason professionals form this type of corporation. They can enjoy sharing management responsibilities and profits without exposing themselves to malpractice actions against the other owners. Depending on state law, limited liability partnerships (LLPs) may offer the same benefit and may even be more desirable.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption

How Do I Set Up a Professional Corporation?

If you are interested in setting up a professional corporation, be sure you understand the requirements of your state. Some states require that each owner hold the same type of business license and will verify this before allowing the corporation to be formed. You may have to carry a certain designation in the company name, such as “PC” for professional corporation. You will also need to draft corporate by-laws. These are the rules of how your business will operate and be governed. You will need to designate officers and their responsibilities, assign decision-making procedures, and set any terms regarding management and finances. The final step is to register your corporation in your state. It varies, but in most cases you will pay a filing fee and submit a registration form. If you feel you need help, your local small business association or a corporate attorney can offer assistance. Some states also have guides posted on their websites to help explain the process.