3 Steps to Starting Your Marriage & Family Therapy Corporation

Form Your Marriage & Family Therapy Corporation the Right Way

If you’re a licensed marriage and family therapist (LMFT) in California, you are legally required to form a Marriage and Family Therapy Professional Corporation (MFT-PC) to provide therapy services or operate your practice.

Under the Moscone-Knox Professional Corporation Act (California Corporations Code §§13400–13410), marriage and family therapists cannot form LLCs or general corporations for their professional practice.

If your Professional Corporation is filed incorrectly, it can be rejected by the California Secretary of State, exposing you to liability risks, penalties, and possible disciplinary actions from the California Board of Behavioral Sciences (BBS).

At All-in-Juan Business Consultancy Services, we’ve helped thousands of California professionals, including LMFTs, successfully start their Professional Corporations accurately, efficiently, and fully compliant with California law.

📩 Email: [email protected]

What Is a Marriage and Family Therapy Professional Corporation?

A Marriage and Family Therapy Professional Corporation (MFT-PC) is a legal business entity formed by licensed marriage and family therapists to provide professional therapy services in California.

It must be registered with the California Secretary of State and hold a Certificate of Registration from the California Board of Behavioral Sciences (BBS) before offering or advertising therapy services.

This structure ensures compliance with California laws while providing personal liability protection, tax advantages, and professional legitimacy.

Why Elect S-Corporation Tax Status

By default, a Professional Corporation is taxed as a C-Corporation, which creates double taxation — once at the corporate level and again at the shareholder level.

Electing S-Corporation status (via IRS Form 2553) allows you to:
✅ Avoid double taxation
✅ Pass profits and losses through to shareholders’ personal tax returns
✅ Reduce self-employment taxes
✅ Maximize your income and tax efficiency

3 Steps to Start a Marriage and Family Therapy Professional Corporation in California

Step 1: File Articles of Incorporation

File your Articles of Incorporation for a Professional Corporation with the California Secretary of State, stating that your business is organized under the Moscone-Knox Professional Corporation Act and provides marriage and family therapy services.

Step 2: Complete Licensing and Compliance Requirements

After incorporation, you must:

• Apply for your EIN from the IRS

• Appoint Directors

• Draft your corporate bylaws

• File your Statement of Information with the Secretary of State

• File Form 2553 to elect S-Corporation tax status

• Pay annual taxes to the California Franchise Tax Board (FTB)

• Register with the Employment Development Department (EDD) if you pay salaries

• Apply for local business licenses or permits

Step 3: Let All-in-Juan Handle It for You

At All-in-Juan Business Consultancy Services, we take care of the entire process — from filing to registration — ensuring your MFT Professional Corporation is compliant, secure, and ready to operate.

📩 Email: [email protected]

Benefits of Forming a Marriage and Family Therapy Professional Corporation

Forming your Marriage and Family Therapy Professional Corporation provides several key advantages:
✅ Asset Protection – Shield your personal assets from lawsuits or debts.
✅ Tax Savings – Reduce taxes with S-Corporation benefits.
✅ Professional Compliance – Meet all BBS and Moscone-Knox Act regulations.
✅ Credibility – Present your practice as a legitimate, state-recognized entity.
✅ Scalability – Build business credit and prepare for future growth.

Who Regulates Marriage and Family Therapy Corporations

In California, all professional corporations are governed by the Moscone-Knox Professional Corporation Act and overseen by their respective licensing boards.

For LMFTs, this is the California Board of Behavioral Sciences (BBS), which issues Certificates of Registration and ensures your corporation meets all legal, ethical, and professional standards.

Who Can Be a Shareholder in a Marriage and Family Therapy Corporation

California law allows ownership by licensed professionals only.

• At least 51% of the shares must be owned by licensed marriage and family therapists (LMFTs).

• The remaining 49% may be owned by other qualified licensed professionals, including:

  • Licensed physicians and surgeons

  • Licensed psychologists

  • Licensed clinical social workers

  • Registered nurses

  • Licensed chiropractors

  • Licensed acupuncturists

  • Naturopathic doctors

Any shares issued to unlicensed individuals or those not authorized by law are void.

If a shareholder loses eligibility or is disqualified from practice, their shares must be sold or transferred within 90 days to a qualified shareholder or the corporation itself.

Name Requirements for a Marriage and Family Therapy Corporation

Your corporation’s name must reflect your professional services and include one or more of the following terms:

“Marriage,” “Family,” or “Child” combined with “Counseling,” “Counselor,” “Therapy,” or “Therapist.”

It must also include a corporate suffix such as:

• “Professional Corporation”

• “A Professional Corporation”

• “Prof. Corp.”

• “P.C.”

• “Inc.”

• “Corporation”

• “A California Professional Corporation”

Examples:
✅ Harmony Family Therapy, A Professional Corporation
✅ Dr. Laura Kim, Marriage and Family Therapy, Inc.

❌ “LLC” or “Limited Liability Company” are not permitted for therapy practices in California.

📝 Note:
California requires all Marriage and Family Therapy Corporations to inform patients at the start of treatment that services are provided by a professional corporation. This may be disclosed through your Informed Consent Form or Disclosure Statement.

Using a Fictitious Business Name (DBA)

A Marriage and Family Therapy Corporation may use a fictitious business name (DBA) if it follows California’s filing requirements:

• File a Fictitious Business Name Statement within 40 days of starting operations.

• File the statement in every county where services are provided.

• Ensure the DBA is not misleading, deceptive, or similar to another registered business name.

Example:
💞 Connected Hearts Counseling Center (filed under Harmony Family Therapy, A Professional Corporation)

Can a Marriage and Family Therapy Practice Operate as an LLC in California?

No.
Under the Moscone-Knox Professional Corporation Act, marriage and family therapists cannot form LLCs to practice professionally in California.

To legally operate, you must form a Professional Corporation registered with the Secretary of State and the California Board of Behavioral Sciences (BBS).

Start Your Marriage and Family Therapy Corporation the Right Way

At All-in-Juan Business Consultancy Services, we make forming your Marriage and Family Therapy Professional Corporation simple and worry-free.

We handle all paperwork, filings, and registrations — so you can focus on helping families heal while we take care of the legal side.

📞 Contact Number: +1 424 407-3686
📩 Email: [email protected]
🌐 Website: www.all-in-juanbusinessconsultancyservices.com

All-in-Juan Business Consultancy Services — Helping California Marriage and Family Therapists Form Their Professional Corporations the Right Way.