New York PLLC Lawyer

Our Legal Services for New York PLLCs

Here’s an overview of the services we offer professionals seeking to establish PLLCs in New York.

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What Is a New York PLLC?

In New York, a PLLC (professional limited liability company) is a specialized business entity governed by Section 1203 of the New York Limited Liability Company Law. Such entities allow professionals like lawyers, doctors, and accountants to conduct their professional services while benefiting from limited liability protection.

Unlike regular LLCs and corporations, PLLCs are intended specifically for practicing licensed professions within the state.

Benefits of a New York PLLC

There are many potential benefits to setting up a PLLC in New York, including the following:

• Limited liability protection: This is a major benefit, as it shields your personal assets from business liabilities.
• Pass-through taxation: PLLCs are treated as pass-through entities for tax purposes, meaning profits and losses "pass-through" to the members' personal tax returns.
• Management flexibility: PLLC operating agreements allow members to decide on management structure, profit sharing, and other internal operations.

Along with these advantages, forming a PLLC can be easier and less expensive compared to the more complex structure of a professional corporation (PC).

Who Should Consider a New York PLLC?

The benefits of a PLLC are especially likely to positively impact:

• Licensed professionals who want to practice as a business entity.
• Professionals seeking personal asset protection from potential lawsuits or business debts.
• Individuals who prefer the flexibility and tax advantages of a pass-through entity.

That said, any professional interested in maintaining control over their operations and accruing specific tax advantages might consider establishing a PLLC.

Legal Requirements for Forming a PLLC in New York

Forming a PLLC involves several legal obligations, including:

• Name selection: Choose a unique name for your PLLC, adhering to New York's naming regulations and including "PLLC" or "Professional Limited Liability Company”.
• Articles of Organization: Draft and file Articles of Organization with the New York Department of State, along with the requisite filing fee.
• Professional services: New York state must give licensing approval for you to form your PLLC before you can file it at the State level. You must establish a PLLC to offer professional services permitted by New York law, with all members holding relevant professional licenses listed in Title VIII of the New York State Education Law.
• Registered agent: Designate a registered agent with a physical address in New York to receive legal documents on behalf of the PLLC.
• Operating agreement: Draft your internal operating agreement, which does not get filed with New York State. This is critical for outlining key governance considerations such as ownership, management, and operational procedures.
• Publication requirement: Within 120 days of formation, publish a notice of the PLLC's establishment in two newspapers as designated by the county clerk in the county where the PLLC's office is located.
• Licensing and permits: Obtain any necessary licenses or permits for the professional services you offer.
• Compliance: Comply with relevant state regulations, including filing annual reports and maintaining accurate records.

Fulfilling these requirements demands careful attention to detail. Consult Lawyer For Business to ensure compliance and a smooth formation process.

What’s the Difference Between a PLLC, PC, and LLP in New York?

The main differences between PLLCs, PCs, and LLPs lie in their distinct structures and purposes:

1. Membership:

• PLLC: All members must be licensed professionals authorized to practice a specific profession.
• PC: Like a PLLC, all members must be licensed professionals.
• LLP: Not all members need to be licensed professionals; an LLP is suitable for partnerships with a mix of professionals and non-professionals.

2. Liability protection:

• PLLC and PC: Both offer limited liability protection, insulating members’ personal assets from business liabilities.
• LLP: Provides limited liability protection, but only for member negligence or malpractice, not for the actions of the LLP itself.

3. Taxation:

• PLLC: Treated as a pass-through entity — profits and losses are reflected in members' individual tax returns.
• PC: Defaults to C Corporation taxation, which can be more complex and involve double taxation (corporate tax and personal tax on dividends).
• LLP: Treated as a pass-through entity similar to a PLLC.

4. Formation and compliance:

• PLLC: Generally considered simpler and less expensive to form compared to a PC; annual reports are filed with the NYSED and Department of State (DOS).
• PC: Formation can be more complex than a PLLC, as it requires maintaining corporate formalities like board meetings and bylaws; compliance filings are similar to a PLLC.
• LLP: Formation is similar to a PLLC; annual reports are filed with the DOS.

Choosing the Right Structure

The best structure for you will depend on your specific needs, preferences, and goals for your practice.

For licensed professionals seeking limited liability and pass-through taxation, a PLLC is a strong choice, while a PC may be better for larger firms with the potential to attract outside investors. An LLP might be suitable if you’re in a partnership with both professionals and non-professionals — just make sure you discuss liability limitations with an attorney.

If you need help choosing the best structure for your business, consult the knowledgeable business attorney at Lawyer For Business, who has ample experience aiding clients in setting up various professional entities.

Why Choose Lawyer For Business?

When you choose Lawyer For Business to help you form your PLLC in New York, you’ll benefit from the following distinctions:

Partner with Lawyer For Business to set up your New York PLLC with confidence.