For licensed professionals
PLLC vs LLC: Which Do Doctors, Lawyers & CPAs Need?
The difference is state-law, not tax. We break down which states require PLLCs, the cost premium, the malpractice gotchas, and when a regular LLC works.
One-paragraph summary
A PLLC is a Professional Limited Liability Company — a state-mandated LLC variant for licensed professionals like doctors, lawyers, CPAs, architects, dentists, and mental-health providers. About 30 states require professionals to use PLLC instead of a regular LLC. The functional difference is small: same pass-through taxation, similar liability shield, slightly higher formation cost and additional licensing-board approval. It does not shield you from your own professional malpractice — only your malpractice insurance does that.
Who has to form a PLLC?
"Licensed professional" varies by state but typically includes:
- Physicians, surgeons, nurses, dentists, dental hygienists, optometrists
- Lawyers (attorneys, paralegals are not regulated equivalently in most states)
- CPAs (Certified Public Accountants)
- Architects, engineers, surveyors
- Psychologists, licensed clinical social workers, marriage and family therapists
- Veterinarians
- Chiropractors, physical therapists
- Pharmacists
Unregulated professionals (programmers, consultants, designers, marketers, business coaches, real estate agents in many states) generally use regular LLCs, not PLLCs.
PLLC vs LLC side-by-side
| LLC | PLLC | |
|---|---|---|
| Who can form | Anyone | Licensed professionals only |
| Approval required | Secretary of State | Secretary of State + Licensing Board |
| Formation cost | $50-$500 | $50-$500 + $25-$200 board fee |
| Members | Anyone | Only licensed in the profession (varies by state) |
| Tax treatment | Pass-through by default | Pass-through by default (identical) |
| Limited liability shield | Yes — business debts | Yes — business debts + co-member malpractice |
| Protects from own malpractice? | No | No — same as LLC |
| Required state-level disclosure | Standard | License numbers of all members usually required |
| Operating across state lines | Easy (foreign LLC) | Harder — license required in each state |
States that require PLLC for professionals
Require PLLC (incomplete list): Arizona, Arkansas, Colorado, Connecticut, Florida, Georgia, Idaho, Iowa, Kentucky, Maine, Maryland, Michigan, Minnesota, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming.
Allow regular LLC for professionals: Alabama, Alaska, Delaware, Hawaii, Illinois, Indiana, Kansas, Louisiana, Massachusetts, Missouri, New Mexico, Rhode Island.
California: Disallows PLLCs entirely. Licensed professionals must use a Professional Corporation (PC) instead.
⚠️ Always confirm with your state's licensing board AND state business division before forming. Rules change.
The malpractice gotcha
Many professionals form a PLLC expecting it to shield them from malpractice. It does not. A PLLC shields you from:
- The business's contract debts (a vendor lawsuit can't reach your home)
- The malpractice of your fellow PLLC members (Dr. Smith's negligence doesn't expose Dr. Jones personally)
- Slip-and-fall and general-business torts
But a PLLC does not shield you from your own professional negligence. If you misdiagnose a patient or miss a filing deadline, you are personally liable, period. Professional liability insurance (malpractice insurance) is the only protection against your own acts.
S-Corp election for a PLLC
A PLLC can elect S-Corp tax treatment (Form 2553) just like a regular LLC. For high-earning professionals (CPAs, lawyers, doctors with ~$150k+ net profit), the S-Corp election often saves $5k-$25k/year in self-employment tax. Caveat: "specified service trades or businesses" (SSTB) — which includes health, law, and accounting — lose the QBI deduction above the income threshold ($197,300 single / $394,600 MFJ in 2026). Plan with this in mind. Run the QBI Calculator or S-Corp Savings Calculator.
Cost comparison: PLLC vs LLC
| State | LLC year-1 | PLLC year-1 |
|---|---|---|
| Texas | $300 | $300 + ~$50 board |
| Florida | $125 | $125 + ~$50 board |
| New York | $200 + publication ~$1,500 | $200 + publication + Dept of Education $50 |
| Texas | $300 | $300 + ~$50 board |
| Washington | $200 | $200 + ~$50-100 board |
In practice the PLLC premium is $25-$200 per year. The bigger consideration is administrative — proving each member's professional license to the state at formation and on amendments.
Related guides
- LLC vs C-Corp comparison — Professional Corporations (PC) are common in California
- QBI Deduction Calculator — handles SSTB phase-out for health/law/accounting
- S-Corp Savings Calculator — common for high-earning professionals
- Best state to form an LLC — for non-professional formations
Frequently asked questions
What is the difference between PLLC and LLC?
A PLLC (Professional Limited Liability Company) is a special LLC type required in many states for licensed professionals — doctors, lawyers, CPAs, architects, engineers, dentists, mental-health providers. Functionally similar to an LLC, but only licensed professionals in the relevant field can be members, and the PLLC must obtain approval from the state licensing board in addition to the Secretary of State.
Do I have to form a PLLC instead of an LLC if I am a licensed professional?
It depends on the state. About 30 states require licensed professionals to use PLLC (or a Professional Corporation). About 20 states allow regular LLCs for professionals — California is unusual in that it doesn't allow PLLCs at all (professionals must use a Professional Corporation). Check your state's licensing board AND business division before forming.
Does a PLLC protect me from malpractice claims?
No. A PLLC shields you from the business's general debts and contract obligations and from the malpractice of your fellow PLLC members. It does NOT shield you from your own professional malpractice — you remain personally liable for your own negligent acts. Malpractice insurance is still required.
How is a PLLC taxed compared to an LLC?
Identically. Both are pass-through by default (single-member as disregarded entity, multi-member as partnership). Both can elect S-Corp or C-Corp tax treatment. The PLLC label is a state-law/licensing distinction, not a tax distinction — the IRS treats PLLCs and LLCs the same way.
How much does it cost to form a PLLC?
Roughly the same as a regular LLC ($50-$500 state filing fee) plus an additional review fee from the licensing board ($25-$200) and proof of professional licensing of all members. Total: usually $100-$700 in the first year, depending on state.
Can a PLLC have non-professional members?
In most PLLC states, no — all members must be licensed in the profession the PLLC practices. Some states allow administrative members (managers who aren't licensed) but not equity members. This makes PLLCs harder to set up with co-founders, investors, or spouses if they aren't licensed in the same profession.