Medical Corporation San Diego
Medical Corporation San Diego Summary
Practicing medicine as a California professional medical corporation may have several distinct advantages over practicing as a sole proprietor or partnership. In California, professional medicine practices may only operate in the form of a corporation by forming a California professional medical corporation under the Moscone-Knox Professional Corporation Act. Among the many benefits of incorporating a professional practice as a California professional medical corporation are the ability to:
- Limit personal liability against creditors and lawsuits (excluding some malpractice claims);
- Obtain business credit without making a personal guarantee;
- Reduce self-employment taxes for shareholders earning wages; and
- Provide fringe benefits, such as medical care and retirement plans.
All California professional medical corporations formed by San Diego Corporate Law include attorney-drafted articles of incorporation and bylaws, federal EIN application, corporate records book with stock certificates, and minutes for the organizational meeting of the board of directors.
Flat Fee Price
- Includes Filing Fees
- See Pricing Assumptions
- Securities Issuance by Quotation
Michael J. Leonard helped us obtain our 501(c)(3), created our bylaws, and completed all of the necessary forms to establish a tax exempt status for our non-profit foundation. He was professional, quick, and great to work with. Mr. Leonard is also very connected in the community and has referred us to useful contacts.
Michel Sproles, Sproles Empowered Youth
My experience working with San Diego Corporate Law has been nothing short of excellent. Michael Leonard is a tremendous asset, and provided us much needed assistance when forming our insurance agency. He assisted with the formation of our corporation, buy / sell agreement, company bylaws, minutes, and stock certificates. Michael is an utmost professional that I would refer to any friend or client.
Michael Fusco, Fusco & Orsini Insurance Services, Inc.
Michael J. Leonard at San Diego Corporate Law has provided GWR valuable assistance and professional advice. As a San Diego based high tech equipment manufacturer, we appreciate that we never have to waste his or our time explaining the engineering or scientific details of our situation as his strong, hands on physics and engineering background is invaluable. We are well protected with Mike looking out for our interests.
Richard Reineman, GWR Instruments, Inc.
In 2009 San Diego Corporate Law converted my Sole Propriety Engineering Company into a “S” Corporation. My experience was painless and Mr. Leonard has done an excellent job staying in contact and continues to be a great advisor. San Diego Corporate Law comes highly recommended.
Curtis Patterson, P.E., Patterson Engineering, Inc.
Michael J. Leonard at San Diego Corporate Law is not your typical attorney experience. Michael puts his full attention into understanding your needs and provides the best solution to meet your goals. I highly recommend San Diego Corporate Law to any of my friends and associates.
Jeff A. Mudd, Best-Rate Repair Company, Inc.
Working with San Diego Corporate Law made dealing with all the paper work of incorporating and setting up my business a dream! Michael is the ultimate professional and knows corporate law inside and out! San Diego Corporate Law is always available to answer questions, assist me with follow up items, and be my go-to and support team.
Elloise Bennett, AP Test Service, LLC
Mr. Leonard is competent, dependable, and gets the work done on time and within budget. He is very responsible to his customers. We would recommend him to anyone that requires a true professional.
Lidija Skolnija, anaZana, Inc.
I was recommended to Michael to help me set up a new corporation I was starting. The advice he gave me was great, and I eventually hired his services to create the agreements and contracts between myself and my business partner. Throughout the process he guided me and asked very detailed questions. I felt that he had my back and my best interest at heart. Looking back now, the contracts he wrote have saved me close to $40,000 in money that I would have otherwise had to pay. Thank you Michael. Everyone should follow your standards.
Jason Delfos, Marketing and Advertising Design Group, LLC
We hired San Diego Corporate Law to help us establish our business in San Diego. In the initial stages of setting up our business and transitioning to California, we were frequently out of town. During this time, Michael answered questions promptly and thoroughly by phone and email. He went above and beyond to keep us on deadline for our aggressive schedule. I would not hesitate to recommend San Diego Corporate Law to another business owner.
Alicia Sorber-Gallegos, Two Men and a Truck
Having no prior experience with business law, I approached Michael to help me set up an LLC for my new company and help me review my legal disclaimers. Michael was very straightforward, honest and helpful. He took the time to explain every detail and answer all of my questions. His work was very diligent and completed exactly by the deadline promised. Michael and San Diego Corporate Law hold my highest recommendation!
Anton Ivanov, Dreams Cash True
Michael J. Leonard helped me configure my business entities into a solid investment vehicle. He is very professional, knowledgeable, easy to reach and timely. San Diego Corporate Law produced a unique and informative Private Placement Memorandum (PPM) for my business for less than half the cost other law firms were charging. I expect to use the PPM and San Diego Corporate Law for many years. I recommend Michael because of his efficient, hands on, practical approach to legal work in a time of dramatic changes with securities laws (JOBS Act).
John Copyak, Clean USA Power, Inc.
San Diego Corporate Law helped me set up MGIV Inc and get established as an S-corp in 2013. I was a one man show and didn’t have a substantial amount of money to spend to get started. I was in the process of filing for a LLC through Legalzoom.com when something didn’t feel right. I picked up the phone and asked Michael if he was available to help. This was my first business so I knew nothing about filing for a corporation or legally establishing a business. Using his knowledge and expertise he coached me toward filing for an S-corp instead of an LLC. It saved the corporation $800 in 2013 and positioned it for success based on the MGIV Communication Consulting model. I find comfort knowing that my business is in good hands. Michael is a great resource and very personable so working with him is convenient and affordable! I recommend San Diego Corporate Law to anyone needing legal assistance with their business!
Michael Gordon IV, MGIV, Inc.
When I needed to move my business from an office suite to a brick and mortar location, San Diego Corporate Law was instrumental in ensuring that the lease provisions were in my best interests. The specialized skills that Michael and his team possess, the fair and transparent fee structure, and their professional yet low pressure consultation process are the reasons why I will retain their services in the future.
Scott Weathers, Alpha Graphics La Jolla
Michael J. Leonard at San Diego Corporate Law not only helped us establish our small business in San Diego, but he helped us to solidify our partnership to avoid any gray areas as we are a family-run business. Michael was easy to work with, knowledgeable, responsive, and professional, and we will continue to use him as our company lawyer moving forward.
Karen Posner, Camp Run-A-Mutt Sorrento Valley
I have nothing but compliments to say about San Diego Corporate Law. Michael and his team have always delivered not only an extremely high level of service, but also have been so patient through the whole process of setting up our LLC. Whenever I have questions or need their service, they are very easy to communicate with and very reasonably priced. I will not only use them for any legal advice that I may need in the future, but also refer all the people that may also need their services.
Andrey Kamogari, Kamo Housing
Michael assisted us with the process of incorporating our non-profit organization. Michael was responsive to all of our questions, and sensitive to the expedited timelines that we encountered. Among the best aspects we experienced in working with Michael was his appreciation for our specific goals and his candid and honest guidance to accomplish those objectives. I would highly recommend Michael Leonard and San Diego Corporate Law.
Esther Hemmen, Mending Matters
San Diego Corporate Law has been a crucial partner for Little Black Diamond. Whether it’s routine incorporation paperwork or complex employment law, Michael is always very responsive and available to help handle our legal issues. He takes the time to understand your business and the unique issues that surround it in order to provide accurate and timely advice that considers the best interest of your business. San Diego Corporate Law is a true partner for any business.
Adam Rosenberg, Little Black Diamond, LLC
California Professional Medical Corporation San Diego Details
A California professional medical corporation is a corporation formed under the Moscone-Knox Professional Corporation Act whose articles of incorporation, bylaws, and other corporate documents contain language in compliance with both the Moscone-Knox Professional Corporation Act and the general provisions of the California Corporations Code.
Only a professional licensed to practice medicine may be a shareholder of a California professional medical corporation. However, the following other licensed professionals may also hold shares, or be officers, directors, or professional employees as long as shares owned by these other licensed professionals do not total more than 49% of all shares in the corporation, pursuant to California Corporations Code §§ 13401(b), (d), 13401.5:
- Licensed doctors of podiatric medicine;
- Licensed psychologists;
- Registered nurses;
- Licensed optometrists;
- Licensed marriage and family therapists;
- Licensed clinical social workers;
- Licensed physician assistants;
- Licensed chiropractors;
- Licensed acupuncturists;
- Naturopathic doctors;
- Licensed professional clinical counselors; and
- Licensed physical therapists.
These other licensed persons may also be employed to render professional services by a California professional medical corporation.
Other restrictions on who may be a shareholder are contained in the California Business and Professions Code, the California Corporations Code, and other applicable law.
A California professional medical corporation with only one shareholder need have only one director, who also must be the sole shareholder, and the sole shareholder must also serve as president and treasurer of the California professional medical corporation, in general, other officers need not be licensed professionals. California Corporations Code § 13403. A California professional medical corporation with only two shareholders need have only two directors, who also must be the two shareholders, and those two sole shareholders must also serve as president, vice-president, secretary, and treasurer of the California professional medical corporation. California Corporations Code § 13403.
A California professional medical corporation is formed by filing articles of incorporation with the Secretary of State. California Corporations Code § 200(c). In addition to the formation procedure of a regular corporation, additional language is added to the articles of incorporation to create a California professional medical corporation. The filing fee for articles of incorporation is currently $100.00. California Government Code § 12186(c). Bylaws, which dictate how the corporation operates, must be adopted.
Shareholders may enter into an optional, separate agreement restricting the sale or transfer of shares of the stock of the California professional medical corporation, a formula for determining the value of shares upon transfer, voting provisions, and other clauses.
A shareholder of a California professional medical corporation is not liable for the debts and obligations of the California professional medical corporation unless: (1) the shareholder personally guarantees a debt or obligation; (2) the shareholder engages in tortious conduct; (3) the shareholder receives improper distributions of the professional corporation’s assets; (4) the shareholder intermingles personal and corporate matters (alter ego; piercing the corporate veil); or (5) the shareholder breaches a duty owed to other shareholders.
A shareholder in a California professional medical corporation who acts as a corporate director and/or officer may have increased liability stemming from his or her actions as a director and/or officer of the professional corporation.
Shareholders in a California professional medical corporation have the right to inspect the books and records of the professional corporation, thereby learning the names of fellow shareholders. The names of shareholders of California professional medical corporations also may be subject to public record and disclosure by the state governing body. The names of officers and directors of a California professional medical corporation are a matter of public record.
Unless otherwise named in the articles of incorporation, the incorporators appoint the initial directors of a California professional medical corporation. California Corporations Code § 210. After shares of stock in a California professional medical corporation have been issued, the shareholders vote annually to elect a board of directors, and the elected directors then elect officers to handle the day-to-day operational management of the California professional medical corporation. A California professional medical corporation must have a president, a corporate secretary, and a treasurer/chief financial officer. Other officers may also be elected in addition to the three required.
Shareholders in a California professional medical corporation exercise no management in a California professional medical corporation based upon shareholder status alone. When shareholders do exercise control of management, the California professional medical corporation risks losing its limited liability protection.
Shareholders contribute assets to the California professional medical corporation in exchange for shares of stock. If the assets contributed are non-cash, the fair market value of the assets establishes the price of the stock.
Shares of stock in a California professional medical corporation are securities.
Federal Securities Issues
Federal securities laws should be considered when issuing stock in a California professional medical corporation. Regulatory filings may be required either to qualify an offering and sale or to receive an exemption.
California Securities Issues
All offers and sales of securities in California require qualification with the Department of Business Oversight unless either the transaction or the security itself is exempted from qualification. The securities laws of other states may also apply to offers or sales of stock made outside California. California Corporation Code §§ 25000-25707; 10 California Code of Regulations §§ 250.9-260.617.
The net income of a California professional medical “C” corporation is taxable by both the federal and state governments at personal service corporation tax rates. The federal personal service corporation tax at the time of this writing is a 35% flat federal tax and an 8.84% California franchise tax.
If a California professional medical corporation distributes dividends to shareholders, the shareholders must report the dividends received as income. This income will be subject to both federal and state income taxes. Taxation of dividends is commonly referred to as “double taxation” because the net income of the California professional medical corporation is taxed twice: first at the corporate level and again if distributed as dividends to the shareholders. Dividend payments made to shareholders are not treated as an expense of the California professional medical corporation.
Double taxation may be minimized by the payment of wages to shareholder-employees, by payment of fair market rent or royalties of assets owned by shareholders, or by payment of fair market interest on a debt owed to shareholders.
California professional medical corporations must pay a minimum annual franchise tax of $800 to the State of California’s Franchise Tax Board for the privilege of doing business as a limited liability entity. Employment taxes and workers’ compensation insurance must be paid on employees’ wages.
Net income, loss, and tax credits of a California professional medical “S” corporation are not taxed at the corporate level and are instead “passed through” to the shareholders.
If not restricted by shareholder agreements or securities law requirements, a shareholder in a California professional medical corporation may readily transfer stock to a new owner, provided the transfer is made only to another licensed professional permitted to own such shares of stock.
Change of ownership does not dissolve or terminate a California professional medical corporation.
A California professional medical corporation can be dissolved by a vote of 50% or more of the voting power of the professional corporation’s shareholders and the subsequent filing of a certificate of election with the Secretary of State. California Corporations Code §§ 204(a)(4), 1900(a), 1901.
The organization of a California professional medical corporation for $1,180.00 assumes a single class of stock. More complex organizations available by quotation. Filings required by applicable federal and blue sky securities laws available for additional fees and with additional costs.
Professional Medical Corporation Questions?
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