One of the entities licensed professionals may choose to use in the practice their profession is the professional service corporation, also known as a PC The professional service corporation carries most of the benefits of a corporation.

As a “legal person” separate from its owners, the acts and liabilities of the professional service corporation are considered separate from those of its stockholders. Stockholders can also be considered employees of the company, which can be financially beneficial for both the company and its owners.

The professional services of a licensed professional, however, are considered acts of those professionals; thus, the corporate form cannot protect them from the services that they render. But, the corporate form will prevent from the acts of other professionals in the company. So in a corporation a doctor’s personal assets may be on the line when he treats a patient, but his not when another doctor treats a patient. In a general partnership, every doctor in the partnership can be held personally responsible.

One other consideration in entity choice is that a professional service corporation is limited to conducting the business of the profession. This means that a doctor cannot use a professional service corporation to run both a doctor’s office and dance studio. If you want to form a multi-purpose company, then the PLLC may be more appropriate.