LAST UPDATED mid-2024 — check the original law pages for current law and talk with an attorney.

If I'm providing professional services (including healthcare), can I use an LLC?

In California, no — most licensed professional services cannot be delivered through an LLC. The state limits LLCs to non-professional purposes. If you're licensed to deliver a professional service, California requires either a sole proprietorship, partnership, or a professional corporation (PC) — with the PC being the standard for building a firm with employees.

What is considered a professional service?

Broadly: any service requiring a state license to deliver. Healthcare professions are the largest category — medical, dental, mental-health, allied health, pharmacy — but also law, architecture, accounting, and engineering.

Who specifically is required to use a Professional Corporation structure?

Any professional licensed by a California board and delivering that service through a corporate structure. The Moscone-Knox Professional Corporation Act enumerates the professions. If you're not sure whether your license triggers the requirement, ask your board or an attorney familiar with the professions.

What are the advantages of a Professional Corporation?

Corporate liability shield (with the caveat that professional malpractice liability stays personal). Access to corporate-form retirement plans and employee-benefit structures. Ownership + succession planning that's cleaner than a sole proprietorship or partnership.