Prerequisites
- Confirmed that your state permits a PLLC for your profession — see your state page
- A licensed clinician who will be the sole member, fully vetted
- A compliant name
- A registered agent
- Healthcare counsel engaged
Steps
1
Confirm PLLC availability for your profession
Check the state’s LLC act and the professional entity provisions, plus the licensing board’s rules. A state permitting PLLCs for dentistry may not permit them for medicine.
2
Clear the name
PLLCs require their own designator, “PLLC”, “P.L.L.C.”, or “Professional Limited Liability Company” depending on the state. The same surname constraints and board-approval requirements that apply to PCs often apply here.
3
Obtain board pre-approval, if required
Some states require a licensing board certificate before filing. Budget weeks.
4
Appoint a registered agent
In the state of organization.
5
File articles of organization
Must include:
- A professional purpose statement limiting the company to the specified professional service
- A member licensure attestation
- Management structure — member-managed is simplest for a single-member professional entity
- Registered agent and office
6
Adopt an operating agreement
The PLLC’s equivalent of bylaws, and the more important document because LLC statutes default to permissive rules. It should address:
- Membership interests, restricted to licensees
- Transfer restrictions, cross-referenced to, or integrated with, the transfer restriction agreement
- Management and voting
- Clinical authority, stating explicitly that professional judgment rests with the licensed members
- Distributions
- Dissolution and what happens on a member’s death, disability, or loss of license
7
Execute the transfer restriction agreement
A PLLC has membership interests rather than certificated shares, so the mechanism differs from a PC’s — restrictions typically live in the operating agreement plus a separate agreement, rather than a legend on a certificate. Make sure the mechanics actually work under your state’s LLC act. See Draft the stock transfer restriction.
8
Get the EIN
Free and same-day from the IRS. Save the CP 575.Note: a single-member LLC is a disregarded entity by default, but it still needs its own EIN as an employer, and payers will require one.
9
Register with state tax and labor agencies
Withholding and unemployment insurance.
10
Raise tax classification with your CPA
Default pass-through, with S-corporation election available. Different analysis from a PC’s, and worth an actual conversation.
PC vs PLLC, the practical differences
Verify it worked
- State-stamped articles of organization
- Entity active and in good standing
- Operating agreement executed, with clinical authority and transfer restrictions addressed
- CP 575 received; legal name recorded exactly
- Tax and employer registrations complete