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Locums through an LLC

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  • Locums through an LLC

    I was considering locums work ( as a PCP ) but was advised to start a single member LLC and getting employed through it
    is there any real benefit of it ?
    In terms of tax benefits or legal protection?


  • #2
    Did that person give you any reasons behind that recommendation?


    • #3
      Originally posted by CordMcNally
      Did that person give you any reasons behind that recommendation?
      tax benefits and more malpractice protection


      • #4
        i have done locums without even an EIN and just had contractor income in addition to my w2.

        IANAL i i cannot imagine that an LLC with one member created for the sole purpose of doing side clinical work would provide any protection whatsoever in a med mal case.

        my understanding is that these legal structures that exist for the sole purpose of trying to provide individual protection are essentially pierced as a matter of course in a lawsuit.

        think about it - there is no actual structure to this business and the sole purpose of forming it was to do the same job you already do. strikes me as very different from an LLC with 3 rental properties in it.


        • #5
          Do you have a medical license in the location where you plan to do locum tenens work? You can’t practice medicine in California under an LLC. Moreover, medical malpractice liability is personal to you for your acts. An LLC (or professional medical corporation isn’t going to act as a shield for you.

          On the tax side, a PC with an S corporation election could get you access to pass through entity elective treatment for state and local taxes. That could be worth the trouble if you’re over the $10,000 SALT deduction limit for federal taxes.


          • #6
            An LLC adds no additional protection from a malpractice suit, but could add protection in a case where something owned/operated by your LLC causes injury or harm. So if you were seeing patients in an office space owned/rented by your LLC and the roof collapsed on the patient and injured them, they couldn’t come after you personally, only your LLC.

            Most/a lot of insurance or financial people who promote LLCs for “asset protection” have no idea what they’re talking about. They’re just happy when you use them to set something up so they can charge you a fee.


            • #7
              NO ASSET PROTECTION for a professional forming an LLC unless:
              • they have employees, or
              • they have a partnership
              Same deductions for a sole prop as for LLC. If a tax prof made that rec, walk away. If a colleague did, same. So much tax gossip with you guys (no offense intended - just don’t get caught up in it).

              ps - you are not “employed” by a SMLLC (or any LLC you own, period)
              My passion is protecting clients and others from predatory and ignorant advisors 270-247-6087 for CPA clients (we are Flat Fee for both CPA & Fee-Only Financial Planning)
              Johanna Fox, CPA, CFP is affiliated with Wrenne Financial for financial planning clients


              • #8
                ok got it , thank you everyone really appreciate the replies