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Ensuring Your Marriage and Family Counseling Clinic is Operating Correctly

As a business, however, you want to ensure that your marriage and family therapy practice is operating correctly under California laws. For example, you cannot run your practice as a general stock corporation, a limited liability company, or as several other corporate types. The only corporate entity available — allowable — for your practice is a California professional marriage and family therapy corporation under the rules of the Moscone-Knox Professional Corporation Act (the “Moscone-Knox Act”). See Cal. Corp. Code, §13400 et seq. You should consult an experienced San Diego corporate attorney for advice and counsel before setting up your new practice.

As a profession, a California marriage and family therapy professionals are governed by the California Board of Behavioral Sciences (the “Board”). The Board is responsible for granting licensure for marriage and family therapists as well as other therapists such as social workers. See Bus. & Prof. Code, 4980 et seq.

As noted, the only available corporate structure that can be used is a California professional marriage and family therapy corporation. Once formed, your professional marriage and family therapy corporation becomes a separate legal entity that provides many business and financial advantages. Among the most important is the shield provided by the corporate structure that will help protect your personal and family assets from seizure by your business creditors. To incorporate your marriage and family therapy practice, you must file the appropriate forms with the California Secretary of State, adopt bylaws, issue stock, and other items. There are also annual forms that must be filed to ensure that your corporation stays in good standing. Hiring an experienced corporate attorney can help ensure that your corporation is formed properly and meets the needs of your practice.

In addition to filing the proper forms, to be in compliance with the Moscone-Knox Act, your marriage and family counseling professional corporation has certain restrictions in terms of ownership and operation. First, only licensed professionals can be shareholders of your professional corporation. Second, at least 51% of those shareholders must be licensed marriage and family therapists. The remaining 49% of the shares can be owned by the following licensed professionals in any combination, at the time of this writing:

  • Physicians and surgeons
  • Licensed Psychologists
  • Licensed professional Clinical counselors
  • Registered nurses
  • Licensed clinical social workers
  • Licensed Chiropractors
  • Licensed Acupuncturists
  • Naturopathic doctors and
  • Licensed Midwives

The restrictions on ownership is another reason it is essential to consult an experienced San Diego corporate attorney to make sure your corporation is set up and operating correctly. If one of your owners retires or loses his or her licensure, then your Bylaws and Owners Agreement should have provisions for automatically removing that person as an owner. There are similar types of restrictions for who may serve on the Board of Directors and for who may be hired as senior-level management. There are also ethical and legal restrictions on how fees and profits may be shared and distributed.

Contact San Diego Corporate Law

For more information, contact Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard can ensure your marriage and family counselling clinic is set up correctly. Mr. Leonard provides a full panoply of legal services for businesses including formation of corporate entities of all types. Mr. Leonard can be reached at (858) 483-9200 or via email. Mr. Leonard proudly serves business owners and residents in San Diego and in the surrounding communities. Like us on Facebook.

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Need Help with your Marriage and Family Counseling Corporation?

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Schedule a Consultation: 858.483.9200