Everyone who's dipped their toes in the business world knows that business incorporation is a significant developmental achievement.
Once you successfully incorporate your business, it enters the wondrous world of being considered an 'incorporated entity.' Although limited, this comes with awesome perks like liability from your business's debts, obligations, and legal matters.
In simple words, incorporation draws a line between business structures and their owners. This process of incorporating means forming a particular corporation referred to as a professional corporation or professional service corporation. While these are quite similar to regular corporations, they vary in some ways. Plus, you have to make sure your profession falls under your state's regulations.
Are you planning to form a professional association in Florida? Maybe your business is ready to get incorporated, but you're not sure how it works in Florida? Well, worry, not! We're here to make your process a whole lot easier. Let's start at the top!
What Does the 'Professional Association' Mean?
To layout all your cards and form a professional association, we must make sure you know what these are exactly. So, you ask, what are these? Allow us to enlighten you!
Professional associations, otherwise known as professional corporations, are almost exactly like regular corporations. The only difference between them is the critical stipulation when you dive into liability protections. Where professional corporations typically protect the owners from a legal claim, it doesn't protect them from claims that result from mistakes made by themselves.
The word 'professional' that allows you to form an association may vary from state to state. These 'professionals' are either professional corporations (PCs), professional LLC (PLLCs), and professional associations (PAs).
How Do I Form A Professional Association In Florida?
We can hear you thinking: alright, so how do I create one? Well, that's precisely what we've discussed below. Keep scrolling to find out!
Single Purpose Requirement
Are you forming a professional services corporation in Florida based on providing professional services in a particular area? Then you have to make sure all shareholders have licenses and authorization to render services in whatever area you have chosen.
Moreover, all of the shareholders must have the appropriate licenses to perform the same professional service. Besides which, the professional service corporation's purpose must be parallel to the shareholders' professional services.
On the flip side, shareholders don't have to perform services for their corporation. Other agents or employees may provide the services instead. That is if they have a license and authorization of that area.
Your corporation's professional services may include any personal services that require a license or legal authorization. These include, but are not limited to, physician, dentist, surgeon, veterinarian, agent architect, attorney, certified public accountant etc. On the other hand, your cooperation may include employees without a license, like clerks, bookkeepers, technicians, secretaries.
Restrictions on Stock Ownership
Moving on, some restrictions apply to professional service corporations in Florida. These include:
Only certain professionals and entities can own a company share. For instance, a professional limited liability company, a professional service corporation, or an individual licensed or legally authorized to offer the same, exact professional services like the ones that the corporation does may own a share of a professional service corporation.
The second thing to remember is that: any transfer or sale of the corporation's stock has protection under the same ownership restrictions. Moreover, all shareholders working in a professional service corporation face prohibitions from creating both a voting trust agreement and anything that would allow anyone to perform the voting power of any or all of that person's stock.
The Name Requirements For Your Professional Service Corporation
One requirement for your professional service corporation based in Florida is that it must contain either 'chartered' 'professional association' or 'PA.'
Furthermore, it should not include words such as company, professional service corporation, incorporated, and other abbreviations, affixes, or prefixes, indicating it is a professional service corporation. The name may contain the last name of one, many, or all of the shareholders. These shareholders may be retired or deceased shareholders.
Only when the corporation registers its name as a fictitious one with Florida’s Department of State, Division of Corporations can they omit the words 'chartered' and 'PA' etc..
What's more? You must register your business under a fictitious name in Florida when conducting business under a name that isn't the shareholder's legal personal name, a properly registered corporate name, service mark, or trademark.
Filing Out The Articles Of Incorporation
Are you looking to form a professional corporation? Then allow us to teach you exactly how that works!
First, you need to file articles of incorporation with the Florida’s Division of Corporations and Department of State. Next, you should check the website form, how to e-file, and then send articles of your incorporation. To make sure your article is just right:
- Your professional corporation’s name
- Your street address of the principal office and the mailing address of the corporation
- Your professional corporation’s specific purpose
- The name and Florida street address and of the registered agent
- The registered agent's acceptance with signature, of the appointment as registered agent
- The incorporator’s name and address
- The signature of the incorporator
- Permits And Taxes
In order to make sure you have the right permits, be sure to check in with the website of your city government office to inquire about local permits and business license requirements.
You can either call or check websites to find the nearest offices. After forming your corporation, you'll have to check in with taxes and other regulatory requirements applicable to your corporation.