A Professional Corporation is a corporation organized for the sole purpose of a professional service. The general category of the PC or PSC can be as S-corporation or C-corporation. The professional service referred to by the law is any personal service that requires a license in Texas. Classic examples of “professional service” providers are architects, attorneys, CPAs, dentists, physicians, and veterinarians. Except for the obligation that directors and officers of a PC must be licensed professionals, the rules regarding the governance of a PC are much like those that apply to non-professional corporations. The corporate form usually insulates its owner from liability. But a professional corporation does not protect its owners from liability for malpractice.
Tax Implications for a Professional Corporation
The federal income tax law provides a unique problem for some PCs. If the IRS determines that a PC is a “personal services corporation,” it is taxed differently than other corporations. The income tax rate for a PC determined to be a personal services corporation is a flat 35 percent, which is less favorable than the graduated tax rates generally applied to corporations. The possibility of having this tax rate applied makes forming a PC undesirable for most licensed professionals.
Forming a Professional Corporation in Texas
If you are evaluating what entities for your practice, contact an experienced Waco business lawyer at 254-753-6437 to discuss forming a professional corporation.
Andrea's practice focuses primarily in Appellate Law, Civil Trial Law, Family Law, and General Law.Read More
Carolina G. Truesdale graduated from Texas Tech University School of Law, Cum Laude.Read More
Eleeza's practice areas include: Personal Injury Law, Civil Trial Law, Commercial Law, Family Law and Pharmaceutical Law.Read More
Gerald R. Villarrial has practiced family law, criminal law and civil litigation for over 20 years.Read More
Jim Dunnam is a Board Certified Specialist in both Civil Trial Law and Family Law.Read More
Mason Dunnam is the fourth generation of Dunnam attorneys at the firm since 1925Read More
Merrilee L. Harmon is a Family Law specialist, Board Certified by the Texas Board of Legal Specialization since 1985.Read More
Vance has 60 years of experience as a lawyer in Waco, Texas handling all types of cases in both the office and the courtroom.Read More