How to Start a California Professional Corporation (Simple & Easy)

What is a California Professional Corporation and when do you need one?

In California, certain professions are prohibited from forming an LLC or a traditional Corporation and instead must incorporate as a Professional Corporation.

Professions that are required to be professional corporations include many of those that must have a state license, such as lawyers, dentists, accountants, doctors, veterinarians, optometrists, marriage and family therapists, architects, psychiatrists, and psychologists, among many others.

In California, professional corporations are governed by the Moscone-Knox Professional Corporation Act.

Unless an exception applies, California professional corporations can be formed only to provide professional services (including secondary services) within a single profession.

A professional service is defined as any service that requires a license issued by a California state regulatory licensing board, state court, or similar agency.

Professional corporations are also governed by the governmental agency that is responsible for overseeing the profession they engage in. Professional corporations must comply with applicable rules in the California Business and Professions Code.

Unless an exception applies, a shareholder must be licensed in the profession that the professional corporation is engaged in. However, other licensed professionals may be officers, shareholders, directors, or professional employees in specified professions, as long as the total number of shares owned by these other licensed professionals is not more than 49 percent of the corporation’s total shares.

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DISCLAIMER: This video and content is for general information only. The information presented should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Nothing herein is intended to nor constitutes a guarantee, warranty or prediction regarding the outcome of your legal matter. This description may contain affiliate links. If you purchase a product through one of them, I will receive a commission (at no additional cost to you). I only ever endorse products that I have personally used and benefited from personally.

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