Yes. It is quite common for a franchise to be operated under a legal entity of some form other than a sole proprietorship. This could be a corporation, LLC, partnership or whatever works best for you.
Full Answer
Can a business become an LLC or PLLC?
In California, a business can't become LLCs or PLLCs. Instead, they have to form registered limited liability partnerships or professional corporations. Some other states do not allow PLLCs. If you live in a state where a PLLC is not possible, you may need to form a professional corporation.
What is a PLLC company?
A PLLC is a type of limited liability company, a business that works like a partnership but has the liability protection of a corporation. Some states do not allow certain types of professionals to form an LLC but instead require them to form a PLLC.
Do you need a license to own a share of PLLC?
Most states require you to have a professional license to own a share of the PLLC. In a couple of states, a licensed professional must organize the PLLC and sign organizational documents. What's the Advantage of PLLC?
Is a PLLC similar to an LLC in Texas?
In many ways Texas PLLCs are similar to LLCs. However, PLLCs are subject to additional legal restrictions and regulations. You may ask yourself: What are the benefits of a PLLC contrasted with an LLC?
What is PLLC in business?
What is the most important license for a PLLC?
What is a PLLC?
Why do business owners start LLCs?
What are the benefits of LLC?
Is a PLLC a good business?
Can a PLLC be sued for malpractice?
See 4 more
About this website
What's a Professional LLC (PLLC)? Should I form one? | LLCU®
A Professional LLC (PLLC) is a type of Limited Liability Company formed for the purpose of providing professional services. Professional services are those where a person is licensed by the state for the service they provide. In most states, all members of a PLLC are required to be licensed.
What Does PLLC Mean?: Everything You Need to Know - UpCounsel
What does PLLC mean? Know the features and benefits of a professional limited liability company and the formation process involved.. What Does PLLC Mean? PLLC is a professional limited liability company, which is a type of LLC.It is formed by licensed professionals engaged in the same type of services.
What is a PLLC: Everything You Need to Know - UpCounsel
Updated November 2, 2020: What Is a PLLC? PLLC stands for "professional limited liability company" and is like a limited liability company except run by licensed professionals like doctors and lawyers.. PLLC and LLC have different restrictions and requirements. A company organized into an LLC is a legal entity.The owners of the company contribute to its funding but do not take personal ...
How to Form a Professional LLC in New York | Nolo
As a licensed professional in New York you can structure your business as a New York professional service limited liability company (PLLC). (Most states refer simply to professional limited liability companies but New York generally refers to professional service limited liability companies while still using the abbreviation PLLC.)
Professional Limited Liability Companies | PLLC | Nolo
In some states, professionals that hold a license can form a professional limited liability company (PLLC) rather than the more common LLC.
What is a PLLC in Texas?
A PLLC is an excellent option for licensed professionals not permitted to form an LLC under Texas law. Some specific examples of professionals eligible to create a PLLC in Texas include: Attorneys; Accountants; Architects; Doctors and physicians; Other medical specialists; Mental health professionals; Dentists; and,
What to do when you are a licensed professional?
If you are a licensed professional preparing to form a new company, take the proper steps to protect your rights, interests, and career. With the right business structure in place, your professional practice will be in a position to thrive.
Why can't a receptionist be a member of the PLLC?
For example, a receptionist at a doctor’s office could not be a member of the PLLC because receptionists are not professionally licensed by the state of Texas to practice medicine.
Is a PLLC a good option for a licensed professional?
There are different structural and legal reasons that make a Texas PLLC the best option for licensed professionals. Like LLCs, each member of the PLLC enjoys limited liability within the company. Additionally, PLLC members are not liable for the negligence of any other member of the PLLC.
Is a PLLC a LLC?
Although similar to an LLC, a PLLC can only be formed by a limited number of licensed professionals performing those specific professional services. Under Texas law ( Texas Business Organizations Code § 301.001 ), PLLC ownership and management must adhere to certain restrictions and requirements. A PLLC is an excellent option for licensed ...
Does a PLLC pay taxes in Texas?
Texas PLLCs do not provide blanket liability protection against a malpractice claim. Instead, each professional member of the PLLC must obtain their malpractice coverage—either individually, or through the company. PLLCs pay taxes in the same manner as LLCs. The PLLC itself does not pay taxes.
Is a PLLC an LLC in Texas?
In many ways Texas PLLCs are similar to LLCs. However, PLLCs are subject to additional legal restrictions and regulations. You may ask yourself: What are the benefits of a PLLC contrasted with an LLC?
Is a Franchise Right for You?
Before you start a franchise, consider both the pros and cons, as well as common challenges you’re likely to encounter. Are they worth it? Are you prepared to work with the franchisor or would you rather work alone?
Choose Your Preferred Industry
The most popular industry for franchising is restauranteering with multinational companies like McDonald’s and Taco Bell. However, there are other numerous industries you can choose from, depending on your interests.
Review the Franchise Disclosure Document
A franchise disclosure document (FDD) is a legal document provided by a franchisor. It contains all the important information that a franchisee requires to make an informed decision.
Establish a Corporation or LLC
Incorporating a business makes it a legal entity with liabilities and so on. This also protects your personal assets in case of litigation, and your corporation might even qualify for a tax relief that’s not available to businesses under sole proprietorship.
Select the Right Location
Next, determine the most ideal location to set up your franchise. Some franchisors will advise you on the best locations and store size, depending on their existing models.
Talk to a Business Lawyer Early Enough
When you’ve decided to start a franchise, the next best thing you should do is get in touch with a franchise lawyer. Despite it being easier than other models, there still are numerous legal issues that you need to sort out before getting into an agreement and launching a franchise.
How to form a PLLC?
Typically, you'll start with all the same forms and articles you would need if you were going to start a standard LLC. Next, you need to gather proof showing that all members are licensed professionals.
What is the difference between LLC and PLLC?
The main difference between an LLC and a PLLC is in a PLLC you can be sued for malpractice, requiring PLLCs to have malpractice insurance. Each member is personally liable for malpractice, but not for the malpractice of any other member of the PLLC, unlike in a partnership.
What Is a PLLC?
PLLC stands for "professional limited liability company" and is like a limited liability company except run by licensed professionals like doctors and lawyers.
What does PLLC stand for?
PLLC stands for "professional limited liability company" and is like a limited liability company except run by licensed professionals like doctors and lawyers.3 min read. 1. What Is a PLLC?
What happens when a partner is sued in a partnership?
It's in the best interests of all members to have professional liability insurance. Also, PLLC members are not personally liable for business debts unrelated to malpractice claims, like office rent.
Can a professional LLC be a PLLC?
A professional LLC is only available to licensed professionals who are offering services that directly relate to their profession. For those who live in a state where professionals cannot form an LLC, a PLLC might be the only option. The first thing to find out is what your state's requirements are for PLLCs, including what professions are included.
Do you need a professional license to be a PLLC?
In some cases, heirs of deceased members can retain ownership without a professional license. If approved, you may need to put PLLC at the end of your company name.
How is a PLLC Formed?
A PLLC is formed by filing the articles of organization in the state in which you are forming the PLLC , just like an LLC is formed. The state generally requires that the owners of the PLLC verify their license status before the PLLC filing can be approved. Many states have a requirement that the business name of the PLLC include the term “PLLC” in the business name, which allows for the company to be clearly identified as a PLLC. In addition, the state licensing board specific to the profession has to approve the articles of organization. Additional requirements depend on the state and on the profession.
How are PC and PLLC similar?
A PC and a PLLC are similar in that the owners of these entities must be professionals. While specific requirements vary by states, there are similar requirements for forming both PCs and LLCs. One of these requirements is that the licenses of the business owners must be verified. Additionally, there are state limits on the different types ...
How is a Single-Member PLLC Taxed?
The IRS classifies a single-member PLLC as a sole proprietorship. A single-member PLLC must file a Schedule C on their personal income tax return. Profits made from a sole proprietorship are subject to both regular income tax and also a self-employment tax at a rate of 13.3%
What is a single member PLLC?
A single-member PLLC is a professional limited liability company with just one member.
What is the form for a PLLC?
A PLLC that is classified as an S Corporation must file a Form 1120S, which is an annual corporate income tax return. This Form 1120S is used to report profits or losses from the S Corporation, and these then pass through to the member's own income tax return, which allows them to avoid the self-employment tax.
Can an LLC be a PLLC?
Under California law, an LLC cannot be formed in order to provide professional services. In California, professionals are allowed to form registered limited liability partnerships (RLLPs) or professional corporations (PCs), but professionals are unable to form LLCs or PLLCs.
Does Upcounsel accept lawyers?
If you need help with a single-member PLLC, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.
What is PLLC in business?
A PLLC is a business structure that offers personal asset protection for business owners in licensed occupations, such as medicine and law. Priyanka Prakash Oct 28, 2020.
What is the most important license for a PLLC?
The most important license for PLLCs is the professional license, which the state licensing board for your profession will grant. Every owner in the PLLC must be licensed to practice the specific profession that the business will be providing.
What is a PLLC?
A professional limited liability company (PLLC) is a business structure that offers personal asset protection for business owners in licensed occupations , such as medicine and law. Only recognized in some states, PLLCs are subject to the same laws as ordinary LLCs. However, the licensing board must verify each owner’s professional license and approve the PLLC’s articles of organization.
Why do business owners start LLCs?
Many business owners launch LLCs because this business structure offers limited personal liability for owners. A creditor of the business can’t come after any owner’s personal assets. In addition, if one owner in an LLC makes a mistake or acts negligently, the other owners can’t be held personally liable.
What are the benefits of LLC?
Other benefits of LLCs include tax flexibility and relatively low setup costs. Several states recognize the PLLC as a special type of LLC for licensed professionals — such as lawyers, accountants, doctors and architects. Licensed professionals can also form other types of business entities.
Is a PLLC a good business?
Business owners in professional industries often prefer to go into business together, but malpractice lawsuits are common. Forming a PLLC is a great way to protect yourself from a partner’s failure or mistake.
Can a PLLC be sued for malpractice?
As with a regular LLC, PLLC owners are shielded from personal liability for business debts and lawsuits, and they are not liable for malpractice committed by their business partners. However, they are personally liable for any claims brought against them for their own malpractice. If a doctor commits malpractice, then the patient can sue the doctor and lay claim to the doctor’s personal assets. For this reason, it’s very important for members of a PLLC to carry professional liability insurance, more commonly known as malpractice insurance.
