Can California Physicians use LLCs to Practice Medicine?

December 29, 2022

Are you a California physician, starting a private practice, and looking for additional liability protection and tax savings?

California Physicians Cannot Practice Medicine Using LLCs

While most people in California are permitted to use Limited Liability Companies (LLCs) to run their business, California physicians are prohibited from doing so.

California Corporations Code §17375

California Corporations Code §17375 disallows “any person who holds a license, certification, or registration issued by a state agency to engage in a business, trade, or profession regulated by that agency” using an LLC.

California Physicians Can use Professional Medical Corporations

While California physicians are not permitted to use LLCs to engage in the practice of medicine, they are permitted to use California professional medical corporations (also known as PCs).


How to Form a California Medical Corporation

California Medical Corporations Can Provide Liability Protection & Tax Savings

While PCs do not shield California physicians from malpractice liability, they can provide liability protection in other contexts. Examples include, breach of contract, employee lawsuits or injuries in the office that are not related to the practice of medicine (e.g., a patient slips and falls). PCs can also provide significant tax savings.

Are You a California Physician that Needs Help Forming a Professional Medical Corporation?

If you need help setting up a California medical corporation, or other entity type, LawInc is here to help.

Form a California Professional Corporation Online

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