A professional limited liability company (PLLC) is a professional corporation with limited liability. A professional LLC is formed by licensed professionals practicing in the same profession. The liability of members of a professional LLC will be limited to their share in the limited liability company. However, the protection of limited liability does not extend to professional misconduct or negligence claims.
Forming an LLC can provide you with various benefits over other types of business entities. For example, having your business start a LLC can provide tax advantages in certain situations.
The procedure and method to form a professional limited liability company varies depending on the state where the business is operating. After a PLLC is formed, members are required to keep comprehensive business records, including minutes of meetings and financial statements.
Services provided by a professional LLC are restricted by limitations and conditions required by the relevant licensing laws. Legal requirements for formation and licensing of a PLLC vary from state to state. In some states, it is mandatory to form a limited liability company for carrying on professions where the law requires a license, for instance, architects, lawyers, doctors, or engineers. However, several states, such as California, do not allow an LLC company to carry on a licensed profession.
Members of a PLLC may sign a LLC operating agreement that stipulates the rights and obligations of members and object or purpose for which the PLLC is formed. An LLC operating agreement is similar to a company charter document and will be alike in structure to a partnership deed. It is not compulsory in any jurisdiction that a professional limited liability company have an operating agreement. However, having an LLC operating agreement is advised to prevent and help in resolving disputes that arise among LLC members.
In some jurisdictions professional limited liability companies are required to have a registered agent in the place where the LLC is formed. A registered agent works as an agent for the LLC to receive important corporate compliance documents, including tax documents. Registered agents are also known as statutory agent or agent of record.
Professional Property Management LLC
An LLC formed by property management professional is known as professional property management LLC. Property management professionals help you with hassle free renting of your properties. Property management includes all aspects of managing an income property, from locating and selecting tenants to maintaining the property, gathering rent, and managing any concerns that arise.