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David L
David L, Attorney
Category: Business Law
Satisfied Customers: 3165
Experience:  Corporate and Business lawyer since 1997
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HI; I AM FORMING NEW CORPORATION FOR MY BUSINESS, AND I

Resolved Question:

HI;

I AM FORMING NEW CORPORATION FOR MY BUSINESS, AND I AM DISSOLVING MY EXISITING CORP. WHICH IS AN (INC. CORP), BUT I DON'T WANT TO FORM A P.C. SINCE I AM A DOCTOR I AM HEARING CONFLICTING INFO. THAT I HAVE TO FORM (P.C. OR PROFESSIONAL CORPORATION) OR (P.A. PROFESSIONAL ASSOCIATION), NEEDLESS TO RESTATE THAT MY EXISTING CORP IS AN (INC) FORMED UNDER MY DOCTOR PROFESSION BUT BECAUSE I PROVIDE VARIETY OF BUSINESS SERVICES BESIDE MEDICAL CARE, LIKE MEDICAL COSMETICS, WEIGHTLOSS, I ALSO SELL NUTRITIONAL PRODUCTS, AND ONLINE SALES, I WANT TO KNOW IF I AM OBLIGATED TO FORM P.C OR P.A UNDER FLORIDA LAW

JN

Optional Information:
State/Country relating to Question: Florida
Submitted: 2 years ago.
Category: Business Law
Expert:  David L replied 2 years ago.

For the professional services, you are required to use the special type of corporation or limited liability company. The laws fall under Chapter 621, Florida Statutes. Here's a little bit of it.

621.03 Definitions.-As used in this act the
following words shall have the meaning indicated:
(1) The term "professional service"
means any type of personal service to the public which requires as a condition
precedent to the rendering of such service the obtaining of a license or other
legal authorization. By way of example and without limiting the generality
thereof, the personal services which come within the provisions of this act are
the personal services rendered by certified public accountants, public
accountants, chiropractic physicians, dentists, osteopathic physicians,
physicians and surgeons, doctors of medicine, doctors of dentistry, podiatric
physicians, chiropodists, architects, veterinarians, attorneys at law, and life
insurance agents.

You can form other corporations for the side services you provide.

David L, Attorney
Category: Business Law
Satisfied Customers: 3165
Experience: Corporate and Business lawyer since 1997
David L and 3 other Business Law Specialists are ready to help you
Customer: replied 2 years ago.

 

Thank you for this clear answer, but if may ask three related questions which will be greatly appreciated. as a result of PC corporation;

 

1- Can I form an S corp status with PC?

2- Would I be personally be liable for lawsuits against my corporation (PC) business (like general liability, work place injury, not malpractice related)?

3- Lastly; would I be personally liable for malpractice claims even with my malpractice insurance is active but the claim exceeds the insurance coverage limit?

 

Thank you in advance ($5 for each) if you can answer any of these questions, and if unable please recommend or refer me to a resource that could.

Expert:  David L replied 2 years ago.

1. Sure you can elect S corp status. S election is an IRS tax status and has nothing to do with corporate formation under state law. You can elect S corp status for your PC. My law firm is structured exactly that way under Florida and federal tax laws.

2. The point of a PC under the law is that certain professional service providers shouldn't be able to shield themselves from personal liability for services they provide. For example, I'm an attorney. The law will not let me simply form a corporation and shield myself personally from services I provide (the logic makes perfect sense). This is why you and I must use this type of corporation. Under 621.07, Florida Statutes:

621.07 Liability of officers, agents,
employees, shareholders, members, and corporation or limited liability
company.-Nothing contained in this act
shall be interpreted to abolish, repeal, modify, restrict, or limit the law now
in effect in this state applicable to the professional relationship and
liabilities between the person furnishing the professional services and the
person receiving such professional service and to the standards for professional
conduct; provided, however, that any officer, agent, member, manager, or
employee of a corporation or limited liability company organized under this act
shall be personally liable and accountable only for negligent or wrongful acts
or misconduct committed by that person, or by any person under that person's
direct supervision and control, while rendering professional service on behalf
of the corporation or limited liability company to the person for whom such
professional services were being rendered; and provided further that the
personal liability of shareholders of a corporation, or members of a limited
liability company, organized under this act, in their capacity as shareholders
or members of such corporation or limited liability company, shall be no greater
in any aspect than that of a shareholder-employee of a corporation organized
under chapter 607 or a member-employee of a limited liability company organized
under chapter 608. The corporation or limited liability company shall be liable
up to the full value of its property for any negligent or wrongful acts or
misconduct committed by any of its officers, agents, members, managers, or
employees while they are engaged on behalf of the corporation or limited
liability company in the rendering of professional services.

The botXXXXX XXXXXne is that you still have the benefit of corporate protection, but not in relation to personal services provided, as stated above.

3. Yes, per the terms of the statute as stated above. If you haven't already done so, you should read through the statute. I think it would provide some clarity. Here's the link for you:

http://www.leg.state.fl.us/STATUTES/index.cfm?App_mode=Display_Statute&URL=0600-0699/0621/0621ContentsIndex.html&StatuteYear=2011&Title=%2D%3E2011%2D%3EChapter%20621

David L, Attorney
Category: Business Law
Satisfied Customers: 3165
Experience: Corporate and Business lawyer since 1997
David L and 3 other Business Law Specialists are ready to help you

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