Friday, April 19, 2013

With business entities, what does the "P" mean in PLLC and P.C.?

I regularly get asked what the "P" means in business names (i.e., PLLC, P.C.), and why some businesses have it while others do not. In short, it means "professional." If you are in a profession that requires a license to practice, you can generally form a professional company. In Iowa, which adopted the Uniform Limited Liability Company Act, practitioners in the following professions can form a PLLC or P.C.:

  • certified public accountancy
  • architecture
  • chiropractic
  • dentistry
  • physical therapy
  • physician assistant
  • psychology
  • professional engineering
  • land surveying
  • landscape architecture
  • law
  • medicine and surgery
  • optometry
  • osteopathic medicine and surgery
  • accounting
  • podiatry
  • real estate brokerage
  • speech pathology
  • audiology
  • veterinary medicine
  • pharmacy
  • nursing

A licensed marital and family therapist can form a PLLC, but not a P.C.

Unlike an LLC or regular corporation, a professional company cannot engage in business activities outside the specific profession in which it is licensed. For instance, a law practice formed as a PLLC or P.C. cannot do anything but practice law. An LLC or corporation, on the other hand, can be formed for any lawful purpose.

PLLCs and professional corporations must be completely managed by individuals licensed to practice in the profession the company practices. The same is not true for LLCs and regular corporations. Otherwise, LLCs and corporations are very similar to PLLCs and professional corporations.

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