Professional corporation
Professional corporations (abbreviated as PC or P.C.) are those corporate entities for which many corporation statutes make special provision, regulating the use of the corporate form by licensed professionals such as attorneys, architects, engineers, public accountants and physicians. Legal regulations applying to professional corporations typically differ in important ways from those applying to other corporations.[1] Professional corporations, which may have a single director or multiple directors, do not usually afford that person or persons the same degree of limitation of liability as ordinary business corporations (cf. LLP).[1] Such corporations must identify themselves as professional corporations by including "PC" or "P.C." after the firm's name.[2] Professional corporations often exist as part of a larger, more complicated, legal entity; for example, a law firm or medical practice might be organized as a partnership of several or many professional corporations.[citation needed]
Legal effect
United States
In U.S. federal subject matter jurisdiction, professional corporations have two citizenships for purposes of diversity, just like ordinary corporations, namely that they are citizens of (1) the state in which they are incorporated and (2) the state in which they have their principal place of business. This is unlike other, similar organizations that are not technically "corporations," such as trade associations, labor unions, partnerships (including limited partnerships and limited liability partnerships), and limited liability companies, for which citizenship is based on the domicile of each member.[3] This has the effect of expanding diversity jurisdiction in suits to which the professional corporation is a party compared to these alternate forms of business organization, thereby expanding the professional corporation's access to the federal courts, which may be advantageous to the firm.
See also
Notes
External links
- "Business & human resources">"Main topics">"Ownership structures" and "Glossary" (searchable) at Nolo: Your Legal Companion. Accessed June 26, 2008.
- "Small Business Guide: Your Online Resource">"Starting Your Business">"Choosing a Form of Organization">"Starting Corporations"> and "Table of Contents" (searchable) at Business Owners ToolKit: Total Know-How for Small Business Owners. Accessed June 26, 2008.
