Do I Have to Incorporate my Architecture Firm?
Like most business people, architects start practicing their trade without giving much thought to how they might best take advantage of the many forms of business available to them. They generally hang out a shingle (if they are not working for an established firm) and give little, if any thought, about how they should be engaged in their business.
One of the many forms of business through which professionals engage in is the corporation because it provides the following benefits over other forms of business:
- It allows the owners to separate their business and personal assets
- It can add legitimacy to the business
- It exists perpetually, meaning it can be passed to others who are licensed in the same profession
- It may enjoy certain tax attributes
- Its owners are generally immune from the debts and obligations of the corporation (subject to certain exceptions)
California Corporations Code Section 13401 provides: “(a) Professional services” means any type of professional services that may be lawfully rendered only pursuant to a license, certification, or registration authorized by the Business and Professions Code, the Chiropractic Act, or the Osteopathic Act. ¶ (b) Professional corporation” means a corporation organized under the General Corporation Law or pursuant to subdivision (b) of Section 13406 that is engaged in rendering professional services in a single profession, …” California Business and Professions Code Section 5610 further provides: “
Each business and business entity is unique. To understand the different options and which direction will be best for your situation, you need to consult with an experienced corporate attorney. Michael Leonard, Esq. of San Diego Corporate Law, named “Best of the Bar” by the San Diego Business Journal in 2016, has the expertise to guide you through everything from forming your business, to creating buy-sell agreements, to executing contracts, and anything in between. To schedule a consultation to discuss any business-related matter, please contact Mr. Leonard by visiting San Diego Corporate Law or by telephone at (858) 483‑9200.