Starting a Professional Corporation in Nevada 2024: Ultimate Guide

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How to Start a Professional Corporation in Nevada

Licensed professional? Level up your business with Nevada professional corporation! Enjoy unique benefits like Nevada LLC, such as limited liability, tax perks, and a polished image. Our step-by-step guide unravels the essentials for smooth compliance and the right fit. LLCBase has your back with expert guidance, so make an informed decision and triumph in Nevada with your professional corporation today!

This guide will review the requirements for starting a professional corporation in Nevada, explore the advantages and disadvantages of this business structure, and help you determine if it is the right fit for your business goals.

Start a Professional Corporation

What is a Professional Corporation

A Professional Corporation (P.C.) is a unique type of corporation designed for licensed professionals, such as doctors, dentists, lawyers, architects, and accountants. Forming a P.C. allows licensed professionals to offer their services through a corporate structure, providing them with the benefits of a traditional corporation, such as limited liability protection and tax advantages. Forming a professional corporation in Nevada is a popular choice due to the thriving professional landscape and business-friendly environment. When starting a professional corporation, choose a reliable formation service in Nevada.

The primary purpose of Nevada Professional Corporation is to protect its owners from personal liability for the corporation’s actions. The shareholders’ personal assets are protected if the professional corporation faces legal issues. Moreover, Nevada professional corporations can offer certain tax benefits, such as deducting employee benefits and operating expenses. These advantages make forming a professional corporation an attractive option for many professionals in Nevada.

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Who Can File Under Professional Corporation Laws

Under Nevada Professional Corporation laws, only certain licensed professionals are eligible to form a professional corporation. The specific professions allowed to form a P.C. may vary slightly by state, but in Nevada, the following professionals can typically form a professional corporation:

  • Physicians and Surgeons
  • Dentists
  • Chiropractors
  • Optometrists
  • Podiatrists
  • Certified Public Accountants
  • Architects
  • Engineers and Land Surveyors
  • Psychologists
  • Marriage and Family Therapists
  • Clinical Social Workers
  • Professional Clinical Counselors
  • Veterinarians
  • Attorneys
  • Speech-Language Pathologists
  • Pharmacists
  • Registered Nurses
  • Physical Therapists
  • Occupational Therapists
  • Acupuncturists

Each profession has its governing licensing board, which sets specific rules and regulations for forming and operating a professional corporation. It is essential to check with the relevant board and state laws to ensure that your profession is eligible to form a professional corporation and to understand the specific requirements associated with your profession.

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Structure of a Professional Corporation

  • Shareholders: Nevada Professional Corporation’s shareholders must be licensed professionals in the same field as the corporation’s purpose. For example, if a professional corporation is formed to offer legal services, all shareholders must be licensed attorneys. This requirement ensures that the professional corporation’s management comprises qualified individuals with relevant expertise.
  • Directors: The directors of a professional corporation in Nevada are responsible for overseeing the corporation’s operations and making high-level decisions. The directors must also be licensed professionals in the same field as the corporation’s purpose. The number of directors required depends on the specific licensing board’s regulations, but typically a minimum of one director is needed.
  • Officers: The officers of Nevada Professional Corporation manage the professional corporation. Officers typically include a President, Secretary, and Treasurer. However, additional officers can be appointed as needed. While not all officers must be licensed professionals, the President must hold a valid license in the same field as the corporation’s purpose.

Starting a Professional Corporation in Nevada: A Guide

Here is a detailed guide to starting a professional corporation in Nevada that you should follow.

Step 1: Appointment of Registered Agent

The first step in forming a Professional Corporation is appointing Registered Agent in Nevada. This individual or company will act on behalf of the corporation, receiving official notices and legal documents. The agent must have a physical address in Nevada and be available during regular business hours.

We compiled the list of the best registered agent services in Nevada to help you choose the one you can rely on.

Step 2: Choosing the Name of the Corporation

Selecting a name for your Nevada Professional Corporation is crucial. The name must be unique and appropriate, including the words “professional corporation” or the abbreviation “P.C.” It must also comply with the rules and regulations of the governing licensing board and should not be confusingly similar to an existing corporation’s name.

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Step 3: Drafting of By-laws

By-laws are the internal rules and regulations governing the management and operations of the professional corporation. These should include provisions related to the appointment of directors, issuance of shares, and any restrictions imposed by the licensing board.

Step 4: Appointment of Board of Directors

The board of directors oversees the management and operations of the Nevada Professional Corporation. Directors must be licensed professionals in the same field as the corporation’s purpose.

Step 5: Conduction of Board Meetings

Regular board meetings are essential for maintaining the proper functioning and compliance of the professional corporation. The by-laws should specify the frequency, notice requirements, and procedures for conducting these meetings.

Step 6: Issuance of Corporate Shares

Shares represent ownership in the corporation. The professional corporation must issue shares to its shareholders, who must be licensed professionals in the same field. Share issuance should comply with the by-laws and any restrictions imposed by the licensing board.

Step 7: Comply with State Requirements

Forming Nevada Professional Corporation requires compliance with specific state requirements, such as obtaining necessary permits and licenses, paying fees, and adhering to rules and regulations the governing licensing board sets forth.

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Step 8: Filing of Statement of Information

Nevada professional corporations must file an annual report with the Nevada Secretary of State. This document includes essential information about the corporation, including its name, address, Registered Agent, and directors.

Step 9: Getting Tax Permits from the State

The professional corporation must obtain the necessary tax permits from the Nevada Department of Taxation, such as an Employer Identification Number (EIN) from the Internal Revenue Service (IRS).

Step 10: Opening of a Bank Account

Finally, open a separate bank account for the Nevada Professional Corporation to maintain proper accounting and financial records.

Fees Associated with Professional Corporation in Nevada

Here are some of the most common fees when starting a professional corporation in Nevada.

  • State Laws and Regulations: To form a professional corporation in Nevada, it is crucial to comply with the state laws and regulations governing professional corporations. The Nevada Revised Statutes Title 7 and the specific licensing board’s regulations for each profession outline the requirements and restrictions for professional corporation formation. Before starting the process, professionals should consult with their licensing board to ensure they meet the necessary qualifications.
  • Incorporation Process: Once the licensing requirements are met, the next step to form a professional corporation in Nevada is to draft and file the Articles of Incorporation with the Nevada Secretary of State. This document includes essential information about the corporation, such as its name, address, purpose, and number of authorized shares. Filing the Articles of Incorporation requires a filing fee currently $75 for most professions. However, it is essential to check with the Nevada Secretary of State for the specific fee associated with your profession.
  • Naming Requirements: You must follow specific rules when choosing a name for a Professional Corporation in Nevada. The name must include the words “Professional Corporation,” “P.C.,” or “Prof. Corp.” Additionally, the name cannot be misleading or too similar to an existing corporation’s name. Conducting a name search with the Nevada Secretary of State is recommended to ensure the chosen name is available. This search is free, but reserving a name before filing the Articles of Incorporation requires a reservation fee of $25 online and $25 mail.
  • Articles of Incorporation: The Articles of Incorporation is a critical document for forming a professional corporation in Nevada. It outlines the corporation’s essential information, such as the name, address, purpose, and number of authorized shares. The Articles must also include a statement that the corporation is a professional corporation and the specific profession it practices. Once completed, the Articles of Incorporation must be filed with the Nevada Secretary of State, accompanied by the appropriate filing fee.
  • Additional Fees and Costs: In addition to the filing fees mentioned above, forming Professional Corporation in Nevada may involve other costs, such as:
    • Annual Report: professional corporations must file an initial Statement of Information with the Nevada Secretary of State every In Nevada, the annual report filing time is not applicable, as it is not a mandatory requirement. of filing the Articles of Incorporation. The filing fee for this form is $0 because it is not mandatory.
    • Licensing and Permit Fees: Depending on the specific profession, the governing licensing board may require additional licensing and permit fees.
    • Registered Agent Fee: Hiring of Registered Agent service will likely involve an annual fee of $50 – $300, which can vary depending on the service provider.
    • Legal and Accounting Fees: Forming a professional corporation may involve consulting with attorneys and accountants, which can result in additional professional fees.

Advantages of a Professional Corporation

  • Limited Liability Protection: One of the main benefits of a professional corporation is its limited liability protection to its shareholders. This means the shareholders’ assets are protected from the corporation’s debts and liabilities.
  • Tax Benefits: Professional Corporations enjoy specific tax benefits, such as deductions for business expenses and the ability to retain earnings within the corporation.
  • Business Credibility: Operating as a professional corporation can enhance the credibility and reputation of the professional services, demonstrating a commitment to compliance and professionalism.
  • Continuity of Operations: A professional corporation has a perpetual existence, ensuring the continuity of operations even if the shareholders or directors change.

Disadvantages of a Professional Corporation

  • Complexity and Cost of Formation: Forming a professional corporation can be more complex and costly than other business structures, such as sole proprietorships or partnerships.
  • Ongoing Compliance Requirements: professional corporations must adhere to ongoing compliance requirements, including regular board meetings, filing annual reports, and maintaining proper records.
  • Limited Flexibility in Management: professional corporations may need more flexibility in management, as the board of directors must consist of licensed professionals in the same field.

Taxation of Professional Corporations

Here are the taxes that your professional corporation must pay in Nevada:

Federal income tax

A professional corporation in Nevada is subject to federal income tax on its net earnings. However, a P.C. can elect to be taxed as an S corporation, which allows the corporation’s income, deductions, and credits to pass through to the shareholders. This can result in significant tax savings by avoiding double taxation.

State taxes

Nevada Professional Corporation is also subject to state taxes, such as the Nevada franchise tax, which is based on the corporation’s annual net income. Additionally, depending on the nature of its operations, the professional corporation may be subject to other state and local taxes, such as payroll and sales taxes permit in Nevada.

Tax deductions and exemptions

A professional corporation in Nevada can take advantage of various tax deductions and exemptions, such as deductions for employee benefits, operating expenses, and depreciation. These deductions can help reduce the corporation’s taxable income, ultimately leading to tax savings for the P.C. and its shareholders.

Alternatives to Professional Corporations in Nevada

If you decide that a professional corporation is not for you, then you might consider the following alternatives.

  • Sole Proprietorships: A simpler business structure is where an individual operates the business under their name without limited liability protection.
  • Partnerships: Two or more individuals join to operate a business, sharing profits, losses, and responsibilities.
  • Limited Liability Companies (LLCs): A hybrid business structure that combines the limited liability protection of a corporation with the tax benefits and flexibility of a partnership.
  • S-corporations: Starting an S Corp in Nevada avoids double taxation by allowing income, losses, and deductions to pass through to the shareholders’ personal tax returns.

FAQs

What is a professional corporation?
A professional corporation is a specific type of corporation that is formed by professionals, such as doctors, attorneys, or accountants, who want to limit their personal liability while maintaining a certain degree of autonomy.
How is a professional corporation different from a regular corporation?
One main difference between a professional corporation and a regular corporation is that the former is typically formed by people with specific professional licenses or certifications. Also, professional corporations are often subject to additional rules and regulations that regular corporations are not.
Why should I form a professional corporation instead of a limited liability company (LLC)?
If you are a licensed professional, forming a professional corporation may be the best option for you as it provides additional legal protection. Additionally, some professions require professionals to form a professional corporation rather than an LLC.
Can a professional corporation be owned by non-professionals?
In Nevada, at least 75% of the shareholders in a professional corporation must be licensed professionals in the same field as the corporation.
What types of professionals can form a professional corporation in Nevada?
In Nevada, professionals such as doctors, attorneys, accountants, architects, engineers, chiropractors and others can form a professional corporation.
What are the benefits of forming a professional corporation?
Some benefits of forming a professional corporation include limited personal liability for the owners, increased credibility with clients, and certain tax advantages.
How do I form a professional corporation in Nevada?
To form a professional corporation in Nevada, you must file articles of incorporation with the Nevada Secretary of State. You will also need to obtain any necessary licenses or certifications.
Can I form a professional corporation alone, or do I need a partner?
In Nevada, professionals can form a professional corporation either alone or with other licensed professionals.
What is the minimum number of shareholders required to form a professional corporation in Nevada?
In Nevada, a professional corporation can be formed with as few as one shareholder.
Is there a limit to the number of shareholders a professional corporation in Nevada can have?
There is no limit to the number of shareholders a professional corporation in Nevada can have.
Do all shareholders in a professional corporation in Nevada need to be licensed in the same field?
Yes, at least 75% of the shareholders in a professional corporation in Nevada must be licensed in the same field as the corporation.
Are there any specific requirements for shareholder meetings in a professional corporation in Nevada?
Yes, Nevada law requires that annual shareholder meetings be held, and that minutes of the meetings be recorded and kept on file.
What are the main steps to forming a professional corporation in Nevada?
The main steps to forming a professional corporation in Nevada include filing articles of incorporation with the Secretary of State, obtaining any necessary licenses or certifications, and distributing shares of stock among the shareholders.
How do I name my professional corporation in Nevada?
Naming your professional corporation in Nevada requires a unique name that complies with the state’s naming standards and checking the availability of the name through the Secretary of State database.
Do I need to obtain any special licenses or certifications before forming an attorney professional corporation in Nevada?
Yes, attorneys who wish to form a professional corporation in Nevada must obtain licensure from the state bar.
Is there a fee to file articles of incorporation for a professional corporation in Nevada?
Yes, there is a fee to file articles of incorporation for a professional corporation in Nevada.
Can I file articles of incorporation for my professional corporation online in Nevada?
Yes, you can file articles of incorporation for a professional corporation in Nevada online through the Secretary of State’s website.
Does the name of my professional corporation in Nevada need to include specific designations or words?
Yes, in Nevada, some professions may require their professional corporation to have special designations such as “Prof Corp” or “PC” at the end of their entity name.
Can I convert an existing regular corporation to a professional corporation in Nevada?
In Nevada, Yes, but you will need to meet certain requirements such as holding permits or licensure to qualify as a professional corporation.
Can I change the business structure of my professional corporation in Nevada after I’ve formed it?
Yes, you have the option to convert a professional corporation to an LLC or a regular corporation if needed.
What ongoing requirements will I need to meet as a professional corporation in Nevada?
All professional corporations in Nevada must comply with annual and biannual filing requirements, file necessary documentation for any changes in corporation information et cetera
What is the tax structure for a professional corporation in Nevada?
In Nevada, most professional corporations have pass-through tax status and the business is not taxed directly. Instead, the incomes and losses are claimed on the individual shareholders’ tax returns.
Are attorneys allowed to share fees in a professional corporation in Nevada?
Attorney professional corporations in Nevada operate under the fee-sharing limitations that govern all attorney-client relationships.
Do all professionals need to form a professional corporation in order to limit their personal and legal liability?
No, there are other business structures that professionals can use rather than forming a professional corporation. Some alternatives include general partnerships or LLPs.
What happens if I don’t comply with all regulations for a professional corporation in Nevada?
Violation of certain regulations for professional corporations can result in fines, penalties and may lead to potential ending of a corporation.
Can a professional corporation in Nevada engage in business activities outside of its professional field?
Yes, a professional corporation may carry out closely-related business activities if permitted by Nevada Law.
Can a professional corporation be administratively dissolved in Nevada?
Yes, if a professional corporation fails to file biennial reports or pay annual fees, it could initiate administrative-dissolution of the corporation by the state.
Can a professional corporation in Nevada own real estate?
Yes, a professional corporation in Nevada has the ability to own and manage real estate relating to their professional services business.
Can I form a foreign professional corporation in Nevada?
Laws vary between states regarding foreign corporation formation, but If approved by Nevada statue, You can form your Foreign Professional Corporation in Nevada by various legal proceedures such as filing proper documents with the Nevada Secretary of State and potentially appointing an agent inside the state.
What is a Professional Corporation in Nevada?
A Professional Corporation in Nevada is a legal business structure created for licensed professionals such as lawyers, accountants, and doctors to provide professional services while limiting personal liability.
Who can form a Professional Corporation in Nevada?
Licensed professionals, such as accountants, lawyers, doctors, or other professionals who require a state license to practice can form a Professional Corporation in Nevada.
Can I form a Professional Corporation in Nevada without a state-issued license?
No, you can’t form a Professional Corporation in Nevada without a state-issued license.
How should I choose the name of my professional corporation in Nevada?
You must ensure that the name of your professional corporation in Nevada meets the applicable state laws and regulations.
Can I reserve my Professional Corporation name in Nevada?
Yes, you can indefinitely reserve your Professional Corporation name in Nevada for a small fee.
Does Nevada provide unique requirements for Professional Corporations?
Yes, Nevada places unique requirements on Professional Corporations, such as filing, authorization, fees, and taxation facilities.
How can I file the required documents for Professional Corporation in Nevada?
You can file the necessary documents to form a Professional Corporation in Nevada by delivering them in-person or sending them online or via post.
Can I file my Professional Corporation documents online in Nevada?
Yes, you can file Professional Corporation documents online in Nevada.
How much should I expect to pay to set up my Professional Corporation in Nevada?
The cost of setting up a Professional Corporation in Nevada may vary, depending on your business needs. The necessary fees charged by the State of Nevada are typically affordable.
What are the tax-loopholes available for Professional Corporations in Nevada?
Professional Corporations in Nevada are subject to standard Nevada corporate taxes and federal taxes and other taxes, excluding state taxes charged in many states.
Does the tax regime of Nevada discourage owners from obtaining a Professional Corporation license?
No, the tax regime of Nevada promotes business development, and the state regulates favorable taxation laws.
Is it necessary to appoint a registered agent in Nevada to set up a Professional Corporation?
Yes, you must appoint a registered agent in Nevada to set up a Professional Corporation. The Registered Agent will be responsible for receiving service of process related to lawsuits and other legal proceedings of your corporation.
Should my registered agent be located in Nevada?
Yes, your registered agent needs to reside in Nevada and have a physical presence with a street address.
Can I be my own Registered Agent for my Professional Corporation in Nevada?
Yes, you are eligible to act as your registered agent if you have a physical address in Nevada or use a registered agent service to comply fully with all regulations.
Is it easy opening a bank account for a Professional Corporation in Nevada?
Yes, it’s quite straightforward to open a bank account for a Professional Corporation in Nevada by following the appropriate banking and corporate formation procedures.
Should my Professional Corporation waive the Nevada compensation section of the model business corporation act, and if so, why?
It depends on the corporation’s recovery and use of lost profits. If not reserved fully in the Articles of Incorporation, lost profits can be recoverable only through a corporate representative litigation under NRS for at-will Professional Corporations.
Can a Professional Corporation lose its character in Nevada if it also operates a non-professional activity?
If a Professional Corporation performs a non-professional activity, it must observe and prioritize its primary professional profile to have both operational aspects under the control of local regulatory authorities.
If I move my Professional Corporation out of Nevada, will its license be affected?
Depending on your specialty and the legal framework concerning your activities in the non-resident state, you may still access equal privileges associated with similar entities in Nevada.
Is it necessary for all shareholders and officers to be licensed in Nevada?
No, not all shareholders and statutory officers in a Professional Corporation in Nevada need to possess applicable licenses.
How does liability protection work for professional shareholders in Nevada?
Professional shareholders can now benefit from liability protection; regardless, authorized individuals’ shares are limited, ensuring minimal liability exposure.
Can a Professional Corporation change its legal status later on?
Yes, unless you specified otherwise in Articles/Bylaws, you can change Professional Corporation functioning to be General Corporation, C Corp, LLCs, or B B Corps etc.
Who will response legal claims against a Professional Corporation?
In Nevada, lawsuits may be generally directed toward the designated warrant Agent under corporation makeup to allow authority when served on behalf of assigned professionals selected.
Who regulates Professional corporations in Nevada?
The Professional Regulation Commission regulates Professional Corporations in Nevada. Las Vegas presents the head office address responsible for actions creation.
Do I need to add a designating the shareholder’s attorney to articles of association upon Nevada establishing a professional corporation?
No regulatory requirement of appointing legal representation for Professional Corporations in Nevada
Besides being a shareholder, can one also act as an officer in Nevada’s Professional Corporations?
Yes, an individual can serve both with the subject to licensure requirements and pursuant to NRS283
Are foreign PC separated by licensing credentials able to register to function within Nevada?
Yes, subject to specified requirements (authorize a certificate from functional state, registration application major requirements, certified copies authentication), a non-Domestic PC operation has ability to register foreign method.
What happens if I breach the legal compliance requirement for Professional corporations’ licensure under the state of Nevada?
Non-compliant entities with statutory requirements can face stiff punishments, fines, documentation, and structural amendments, making Nevada law on Professional dealings precise and encompassing, minimizing infractions liable to stifle professional entrepreneurship or competitiveness.
Are LP and LLP Business types acceptable citizens for Professional corporations within Nevada’s Business environment?
The sole possibilities presented by Nevada bureaucratic arrangement on Business laws infrequently simplify modification and name changes on Sole Conglomerate proprietorship settings, regardless of portfolio shaping. A Limited partnership (LP) or Limited Liability Partnership (LLP) will not officially recognize the statutes that requirement licensing as a professional or when Insurance claims lawsuit is filed.

Also Read

How to Save Money While Forming Nevada Professional Corporation

One of the first steps aspiring business owners can take to save money on forming a Nevada professional corporation is to do their research and carefully plan out their business structure. By understanding the legal requirements and implications of different entity types, entrepreneurs can make informed decisions that align with their specific needs and goals. For example, choosing the right entity type based on the nature of the business and potential future expansion plans can help save money in the long run by avoiding unnecessary reorganization costs.

Another cost-saving strategy is to handle as much of the formation process as possible independently, rather than hiring expensive legal or consulting services. With a wealth of online resources and do-it-yourself kits available, entrepreneurs can often complete the necessary paperwork and filing requirements without the need for costly professional assistance. By taking the time to educate themselves on the process and requirements, business owners can save hundreds or even thousands of dollars in formation fees.

Furthermore, entrepreneurs can also save money by being conscious of timing and taking advantage of any available discounts or promotions. For example, some formation service providers may offer special deals during certain times of the year or discounts for bundled services. By keeping an eye out for these opportunities and being proactive in their research, business owners can reduce the overall cost of forming their professional corporation.

It’s also essential for entrepreneurs to be mindful of ongoing expenses associated with maintaining a professional corporation in Nevada. By understanding the annual fees, reporting requirements, and any other associated costs, business owners can budget accordingly and avoid any surprises down the road. Additionally, being organized and compliant with all obligations can help prevent costly penalties or fines.

In addition to being strategic and resourceful in the formation process, entrepreneurs can also save money by carefully managing their operational expenses once their professional corporation is up and running. By embracing cost-effective tools and technologies, negotiating favorable terms with vendors, and continuously evaluating their financial performance, business owners can ensure that their corporation remains financially healthy and sustainable in the long term.

In conclusion, while forming a professional corporation in Nevada may involve significant upfront costs, there are several ways that business owners can save money throughout the process. By being proactive, resourceful, and strategic in their approach, entrepreneurs can minimize expenses while still setting up a successful and compliant business entity. With careful planning and attention to detail, aspiring business owners can achieve their goals of establishing a professional corporation in Nevada without breaking the bank.

Conclusion

Nevada Professional Corporation can offer several benefits for licensed professionals. However, it is essential to carefully consider the proper structure and compliance requirements before proceeding. Seeking professional guidance in forming a professional corporation can help ensure a smooth process and enable professionals to focus on providing their services. Visit LLCBase for more information about starting a professional corporation in Nevada.

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