Define: Professional Corporation

A professional corporation (PC) is a type of legal business entity formed by licensed professionals, such as doctors, lawyers, accountants, and architects, to provide their professional services. Unlike traditional corporations, which are formed for profit and can be owned by shareholders, a professional corporation is typically owned and operated by the professionals who hold licenses in the specific field. The primary purpose of forming a professional corporation is to limit the personal liability of the professionals for malpractice or other liabilities arising from their professional services. However, the extent of liability protection may vary depending on the jurisdiction and the specific laws governing professional corporations. Professional corporations are subject to regulatory requirements and may have additional restrictions or requirements imposed by professional licensing boards or regulatory agencies.

A legal structure authorized by state law for a fairly narrow list of licensed professions, including lawyers, doctors, accountants, many types of higher-level health providers and often architects. Unlike a regular corporation, a professional corporation does not absolve a professional for personal liability for her own negligence or malpractice. The main reason why groups of professions choose this organizational structure is that, unlike a general partnership, owners are not personally liable for the malpractice of other owners. In some states, limited liability partnerships offer this same benefit and may be more desirable for other reasons.

This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.

This glossary post was last updated: 29th March, 2024.