3 Steps to Starting Your Medical Professional Corporation

Form Your Medical Professional Corporation in California

If you’re a doctor or physician in California, you are required to form a Professional Medical Corporation (PMC) to operate your medical practice legally.
California law prohibits medical professionals from forming LLCs or standard corporations for their practices.

Instead, under the Moscone-Knox Professional Corporation Act (California Corporations Code §§ 13400–13410), you must register your medical practice as a Professional Corporation with the California Secretary of State and the Medical Board of California.

If your Professional Corporation is formed incorrectly, the Secretary of State may reject it — leaving you vulnerable to lawsuits, penalties, and even disciplinary action from the Medical Board of California.

At All-in-Juan Business Consultancy Services, we’ve helped thousands of California professionals, including doctors and surgeons, form their Professional Corporations quickly, correctly, and 100% compliant with state law.

📩 Email: [email protected]

What Is a Medical Professional Corporation?

A Medical Professional Corporation (MPC) is a special type of corporation that allows licensed physicians to legally provide medical services in California.
It must be registered with both the California Secretary of State and the Medical Board of California, in accordance with the Moscone-Knox Act and Title 16, California Code of Regulations.

A properly formed Medical Corporation gives you:

• Legal protection from personal liability

• Tax efficiency when structured as an S-Corporation

• Professional credibility

• Eligibility for business credit and insurance

Why Choose S-Corporation Status for Your Medical Corporation

By default, all Professional Corporations are taxed as C-Corporations, which means both the corporation and the shareholders pay taxes (double taxation).
To avoid this, most doctors elect S-Corporation status by filing IRS Form 2553 within 75 days of incorporation.

An S-Corporation allows your income to pass through to your personal return — minimizing self-employment taxes and avoiding double taxation.
You can pay yourself a reasonable salary while taking additional earnings as dividends, which are not subject to self-employment tax.

3 Simple Steps to Form Your Medical Professional Corporation

Step 1: File Articles of Incorporation

File your Articles of Incorporation for a Professional Corporation with the California Secretary of State, making sure it clearly states that the corporation is organized under the Moscone-Knox Professional Corporation Act.

Step 2: Complete All Legal and Tax Requirements

After your corporation is approved:

• 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 Experts Handle It for You

You can do everything yourself or let All-in-Juan Business Consultancy Services take care of it for you — ensuring your Medical Professional Corporation is set up accurately, efficiently, and compliant.

📩 Email: [email protected]

Benefits of a Medical Professional Corporation

Forming a Medical Professional Corporation in California provides key advantages:
✅ Personal Asset Protection – separates your personal and professional liabilities
✅ Tax Savings – reduce self-employment tax through S-Corporation election
✅ Business Credibility – enhances trust with patients and partners
✅ Business Growth – build corporate credit and scale your practice

Professional Medical Corporation Requirements

Under California Corporations Code §13401(b), all Professional Corporations must be registered with their governing board.
For medical professionals, this means registration with the Medical Board of California and adherence to Title 16 of the California Code of Regulations.

Naming Rules for Medical Professional Corporations

Your corporation name must comply with California’s strict naming standards.
It must:

• Include the name or surname of one or more physicians or stockholders.

• Contain a proper corporate ending, such as:
  “Medical Corporation,” “Professional Corporation,” “Inc.,” “Corp.,” “Incorporated,” or “Prof. Corp.”

• Avoid being false, misleading, or confusing.

Example:
✅ John Doe Medical Corporation
✅ John Doe, M.D., Inc.

Who Can Be a Shareholder in a Medical Professional Corporation

Under California law, the majority of shares (at least 51%) must be owned by licensed physicians.
The remaining 49% can be owned by other licensed professionals, including:

• Psychologists

• Optometrists

• Marriage and Family Therapists

• Clinical Social Workers

• Physician Assistants

• Chiropractors

• Acupuncturists

• Naturopathic Doctors

• Professional Clinical Counselors

• Physical Therapists

• Pharmacists

The total number of non-doctor shareholders cannot exceed the number of licensed physicians and cannot collectively own more than 49% of the corporation.

If a shareholder becomes ineligible or disqualified, their shares must be transferred within 90 days to a qualified professional or the corporation itself.

Using a Fictitious Business Name (DBA)

Doctors and medical corporations may use a fictitious business name if they obtain a Fictitious Name Permit from the Medical Board of California under Section 2415 of the California Code of Regulations.

Requirements:

• File a Fictitious Name Permit before using a DBA in any public advertisement or signage.

• The name cannot be misleading, deceptive, or similar to an existing medical corporation’s name.

If your practice name includes your legal name (e.g., John Doe, M.D. Inc.), a fictitious name permit is not required.

Learn more from the Medical Board of California: mbc.ca.gov/Applicants/Fictitious_Name

Single-Shareholder Medical Corporations

Yes, a California Medical Corporation can be owned by a single physician.
In this case, the physician must serve as both President and Treasurer, while other officers (like Secretary) do not need to be licensed doctors.

Liability of Shareholders

Generally, shareholders of a Medical Professional Corporation are not personally liable for the corporation’s debts or obligations.
However, personal liability may occur if a shareholder:

• Personally guarantees debts

• Commits malpractice or wrongful acts

• Receives improper distributions

• Mixes personal and corporate funds (piercing the corporate veil)

Start Your Medical Professional Corporation the Right Way

Starting your Medical Professional Corporation can be complex — but we make it simple.

At All-in-Juan Business Consultancy Services, we handle the entire process from incorporation to compliance, ensuring your medical practice is legally protected and tax-optimized.

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

All-in-Juan Business Consultancy Services — helping California doctors and medical professionals build their practices the right way under the Moscone-Knox Act.