What Is a Professional LLC (PLLC)?

A PLLC Is an LLC Built for Licensed Professions

A professional LLC (PLLC) is a state-law entity, a specific variant of the standard LLC that many states created so licensed professionals can form a limited liability entity while complying with their profession's licensing rules. It follows the same basic formation process as a regular LLC, Articles of Organization and a registered agent, with additional requirements layered on, most notably that its members generally must hold a current license in the profession the PLLC practices.

How a PLLC Is Taxed

The IRS doesn't have a separate tax category for a PLLC any more than it does for a regular LLC. A single-member PLLC is treated as a disregarded entity by default, with profits and losses reported on the owner's personal return, and a multi-member PLLC is treated as a partnership by default, filing Form 1065 and issuing Schedule K-1s. A PLLC can elect corporate or S corporation tax treatment the same way any other LLC can, by filing Form 8832 or Form 2553, as long as it otherwise qualifies.

Which States Offer the PLLC Entity

More than 40 states have a PLLC provision in their LLC statutes. California, Delaware, Hawaii, Indiana, Louisiana, South Carolina, Vermont, Wisconsin, and Wyoming do not; in those states, a licensed professional typically uses a regular LLC, if their specific licensing statute allows it, or a different entity such as a professional corporation.

How to Form a PLLC

Where available, you form a PLLC by filing Articles of Organization, often on a PLLC-specific state form, with your state's filing agency. Many states also require proof of licensure, such as a certificate from the relevant licensing board confirming the organizers or members hold a valid license in the profession, before approving the filing. Beyond that added documentation, the process, fees, and registered agent requirement generally mirror a regular LLC's.

What a PLLC Does and Doesn't Protect

A PLLC protects its owners' personal assets from the business's general debts and from a co-owner's wrongdoing, the same liability shield a regular LLC provides. It does not protect a licensed professional from liability for their own malpractice or professional negligence; that liability follows the individual regardless of the entity they practice through. Malpractice insurance, not the entity choice, is what actually addresses that specific risk.

A Professional Corporation Is a Related but Different Option

In some states, licensed professionals also have the option of a professional corporation (PC) instead of a PLLC. A professional corporation follows corporate tax and governance rules rather than LLC rules, including more formal requirements like a board and corporate minutes in most states. Which option fits better depends on your profession, your state's rules, and whether you prefer an LLC's simpler governance or see a benefit in the corporate structure.

Confirm Your Licensing Board's Requirements Separately

Whether you're required to use a PLLC, permitted to use a regular LLC, or required to use something else entirely depends on both your state's business entity statute and your specific licensing board's own rules, which don't always align. Check with your licensing board directly rather than assuming your state's LLC statute tells the whole story.

A PLLC Can Sometimes Convert to a Regular LLC Later

If your licensing status changes, or if the business expands into non-licensed activities, some states allow converting a PLLC to a regular LLC or vice versa through an amendment process. Whether this is available, and what it requires, depends on your specific state, so don't assume it's automatic.

Multi-State Practices Need to Check Every State's Rules

If your practice operates in more than one state, each state may have its own PLLC rules, its own licensing board requirements, and its own foreign qualification process for an out-of-state PLLC. Confirm the requirements in every state where you actually practice, not just your home state.

Talk to a Business Attorney Before Choosing a Structure

Choosing between a PLLC, a regular LLC, and a professional corporation involves tradeoffs specific to your profession and state that go beyond a general overview. This isn't legal advice; talk to a business attorney or your licensing board before forming your entity.