Professional Corporations and Limited Liability Companies FAQs

1. What is a professional corporation, association or limited liability company?
2. Who can form a professional corporation, association or limited liability company?
3. Can a physician or physician assistant incorporate or organize with others?
4. If I plan to offer more than one type of professional service, should I obtain a certificate of registration for each allowable combination of professional services?
5. Can a physician assistant own a professional corporation or limited liability company?
6. Can a PA form a professional corporation or limited liability company with a physician, yet the PA owns a majority of the stock or membership?
7. Can a PA own 100 percent of a professional corporation or limited liability company and hire physicians as employees or independent contractors to practice medicine?
8. Do I need to notify the NC Medical Board if I sell my practice or merge with another business?
9. Are there any limitations on ownership/membership of capital stock in a professional corporation, association or limited liability company?
10. Where can I find information on how to register a professional corporation, association or limited liability company and the requirements to maintain the registration?

• What is a professional corporation, association or limited liability company?

  Professional Corporation/Association
  A professional corporation/association (PC/PA) is a corporation which provides a professional licensed service to the public. The PC/PA must be registered with the licensing board that regulates the professional service to be provided. Please visit the NC Secretary of State’s website for more information about professional corporations.

  Professional Limited Liability Company
  A professional limited liability company (PLLC) is a business organization permitted to be established under North Carolina law and is owned by members (rather than shareholders of a corporation) and managed by managers (rather than officers and directors of a corporation).  NC General Statute 57C-2-01(c) permits a professional limited liability company to render professional services to the same extent as a professional corporation established under NC General Statute 55B. Please visit the NC Secretary of State’s website for more information on professional limited liability companies.

  
  
• Who can form a professional corporation, association or limited liability company?

  A licensed physician and/or physician assistant may form a professional corporation, association or limited liability company as a sole shareholder/member or can incorporate/organize with other physicians or physician assistants to provide medical services. NCGS 55B-14 (a) A professional corporation shall render only one specific type professional service, and such services as may be ancillary thereto, and shall not engage in any other business or profession; provided, however, such corporation may own real and personal property necessary or appropriate for rendering the type of professional services it was organized to render and it may invest in real estate, mortgages, stocks, bonds, and any other type of investments.

  
  
• Can a physician or physician assistant incorporate or organize with others?

  Yes. There are several combinations of professional services allowed under NCGS 55B that require registration and certification from the respective professional licensing boards. [NCGS 55B-14 (c)]
  A professional corporation may also be formed by, between or among:

  • A licensed psychologist and a physician practicing psychiatry to render psychotherapeutic and related services.
  • A physician and a physician assistant who are licensed, registered or otherwise certified under Chapter 90 of the General Statutes to render medical and related services.
  • A physician, a licensed psychologist, a licensed clinical social worker or each of them and a certified clinical specialist in psychiatric and mental health nursing, a licensed marriage and family therapist, a licensed professional counselor, or each of them, to render psychotherapeutic and related services that the respective stockholders are licensed, certified, or otherwise approved to provide.
  • A physician and any combination of a nurse practitioner, certified clinical specialist in psychiatric and mental health nursing or certified nurse midwife, registered or otherwise certified under Chapter 90 of the General Statutes, to render medical and related services that the respective stockholders are licensed, certified, or otherwise approved to provide.
  • A physician practicing anesthesiology and a certified nurse anesthetist to render anesthesia and related medical services that the respective stockholders are licensed, certified or otherwise approved to provide.
  • A physician and an audiologist who is licensed under Article 22 of Chapter 90 of the General Statutes to render audiological and related medical services that the respective stockholders are licensed, certified or otherwise approved to provide.
  • A physician practicing ophthalmology and an optometrist who is licensed under Article 6 of Chapter 90 of the General Statutes to render either or both of ophthalmic services and optometric and related services that the respective stockholders are licensed, certified or otherwise approved to provide.
  • A physician practicing orthopedics and a podiatrist who is licensed under Article 12A of Chapter 90 of the General Statutes to render either or both of orthopedic services and podiatric and related services that the respective stockholders are licensed, certified or otherwise approved to provide.
  
  
• If I plan to offer more than one type of professional service, should I obtain a certificate of registration for each allowable combination of professional services?

  Yes. If more than one type of professional service is rendered, a certificate of registration must be obtained from the respective professional licensing boards for each professional service provided by a professional corporation or limited liability company.

  
  
• Can a physician assistant own a professional corporation or limited liability company?

  Yes. A licensed physician assistant may form their own practice to render the professional service he/she is licensed to provide.
  Please read the Forum article written by staff attorney Marcus Jiminson, JD, for more information.
  “PA and NP Ownership of Professional Corporations”  (Fall, 2006: pgs. 17-18) 

  
  
• Can a PA form a professional corporation or limited liability company with a physician, yet the PA owns a majority of the stock or membership?

  Yes. Please read the Forum article written by staff attorney Marcus Jiminson, JD, for more information.
  “PA and NP Ownership of Professional Corporations”  (Fall, 2006: pgs. 17-18)

  
  
• Can a PA own 100 percent of a professional corporation or limited liability company and hire physicians as employees or independent contractors to practice medicine?

  No. Please read the Forum article written by staff attorney Marcus Jiminson, JD, for more information.
  “PA and NP Ownership of Professional Corporations”  (Fall, 2006: pgs. 17-18)

  
  
• Do I need to notify the NC Medical Board if I sell my practice or merge with another business?

  Yes. In compliance with NCGS 55B, you must obtain prior aprroval from the NC Medical Board if you change ownership of a professional corporation, association or limited liability company registered with the Board.

  
  
• Are there any limitations on ownership/membership of capital stock in a professional corporation, association or limited liability company?

  Yes. Shares of capital stock or membership may only be held by a licensee, as defined in NC General Statute 55B-2(2).  A “licensee” means any natural person who is duly licensed by the appropriate licensing board to render the same professional services which will be rendered by the professional corporation of which he/she is, or intends to become, an officer, director, shareholder or employee.

  
  
• Where can I find information on how to register a professional corporation, association or limited liability company and the requirements to maintain the registration?

  On the NCMB website, visit the section for ‘Licensing’ and choose the link to either corporations or limited liability companies.
  

  
  
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