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Incorporating in North Carolina

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  • Incorporating in North Carolina

    I've read many threads and articles about incorporating and I'm just more confused.  Some say S corp, some say LLC.  And in NC there are professional corporations (PC, PA, PLLC) for licensed business owners such as doctors.

    Any opinion/guidance on what to do?  Any help is MUCH appreciated.

  • #2
    You should meet with a CPA or tax attorney in your area who should be able to give you specific guidance.

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    • #3
      This may be helpful (a bit dated but good start), but agree with above, best to consult professional.

      http://www.aafp.org/fpm/2005/1100/p42.html

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      • #4
        I have an s-corp for my practice in NC.  It is also a professional association.

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        • #5
          As far as I can tell, a PSC (refers to a Personal Service Corporation, also called a Professional Service Corporation) in NC is not different from a PSC in any other state. PSC's are C corporations that are owned by professionals who are required to be licensed by a state licensing board. The requirements vary somewhat from state to state with some exceptions as to what types of professions must use the PSC structure and whether the ownership must be 100% licensed professionals.

          The IRA has a different tax structure for PSC's (or PC's) than it does for "ordinary" C corporations in that any profits are taxed at a flat 35% rate rather than the graduated rate available to individuals and owners of pass-through entities such as S-corporations and LLC's. This post I wrote last year for WCI might be helpful: Should Doctors Use Personal Service Corporations? As you'll notice, I'm not a big fan.

          Also try these posts from my blog:

          What Business Entity Should I Choose?

          How to Set up Your New Business

          Although the above article explains the necessary steps, I really wrote it for physicians with some side income who are not setting up their primary business structure. I do not believe this is a DIY project in your situation. If I did, I would say so.

          If you have other questions, let me know. We serve clients in NC.
          Working to protect good doctors from bad advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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