New York PLLC Formation — Licensed Professionals
If you are a licensed professional in New York — physician, attorney, dentist, architect, engineer, accountant, veterinarian, psychologist, optometrist, physical therapist, or any other profession requiring state licensure — you cannot form a standard LLC. New York law requires you to form a Professional Limited Liability Company (PLLC). The formation process is different from a regular LLC and requires approval from the New York State Education Department before you can file with the Department of State.
We handle the full PLLC formation process. Attorney Cook holds an LL.M. in Taxation and an MBA, which means the entity is structured with both regulatory compliance and tax efficiency in mind from the start.
Call toll-free: (888) 275-2620. Available 24/7.
Why a PLLC Instead of an LLC
New York Business Corporation Law § 1503 and Limited Liability Company Law § 1207 restrict the use of standard business entities by licensed professionals. If your profession is regulated by the New York State Education Department — which covers over 50 licensed professions — you must form either a Professional Corporation (PC) or a Professional Limited Liability Company (PLLC). You cannot form a standard LLC, a standard corporation, or a general partnership for the practice of your profession.
The PLLC structure provides limited liability protection for business debts and obligations of the entity. However, it does not shield individual members from liability for their own professional malpractice. Each professional remains personally liable for their own acts, errors, and omissions in the practice of their profession. The PLLC protects you from liability for the malpractice of your partners — not your own.
The PLLC Formation Process
Forming a PLLC in New York requires several steps that do not apply to standard LLC formation. We handle each one.
Step 1: Education Department approval. Before you can file anything with the Department of State, you must obtain consent from the New York State Education Department (NYSED), Office of the Professions. NYSED verifies that every proposed member of the PLLC holds a valid, current professional license in New York. If a member is licensed in another state but not New York, they must provide a certificate of good standing from their licensing jurisdiction. NYSED reviews the proposed entity name, the profession to be practiced, and the license status of each member. This approval process can take several weeks. We prepare and submit the application to NYSED and follow up until approval is received.
Step 2: Articles of Organization. Once NYSED approval is in hand, we prepare and file the Articles of Organization with the New York Department of State. The articles must include the NYSED consent letter. The entity name must include the words “Professional Limited Liability Company” or the abbreviation “PLLC.” The name must be distinguishable from other registered entities and must not be misleading to the public regarding the profession practiced.
Step 3: Publication requirement. Like standard LLCs, a newly formed PLLC must publish a notice of formation in two newspapers (one daily, one weekly) designated by the County Clerk in the county where the PLLC’s principal office is located, for six consecutive weeks. After publication, the affidavits of publication and a Certificate of Publication must be filed with the Department of State within 120 days of formation. Publication costs vary significantly by county — from approximately $200 in upstate counties to $1,900+ in Manhattan. Learn more about the LLC publication requirement.
Step 4: Operating Agreement. New York requires the PLLC to adopt a written Operating Agreement. The PLLC operating agreement must address all the standard provisions of an LLC operating agreement — ownership, management, distributions, transfer restrictions, withdrawal, death and disability, dispute resolution, and dissolution — plus additional provisions specific to professional practice. Only licensed professionals may be members. The agreement must address what happens if a member’s professional license is suspended, revoked, or not renewed. The agreement should address regulatory compliance obligations specific to the profession practiced. If the PLLC practices in a field where the licensing authority imposes additional restrictions on entity structure (some do), the operating agreement must conform to those requirements. Learn more about operating agreements.
Step 5: EIN registration. We obtain the federal Employer Identification Number (EIN) from the IRS. The PLLC needs this before it can open a business bank account, hire employees, or file tax returns.
Step 6: Tax election. Like a standard LLC, a PLLC is a pass-through entity by default. A single-member PLLC is a disregarded entity. A multi-member PLLC is taxed as a partnership. The PLLC can also elect S-Corp taxation if it produces a better tax result — and for many professional practices generating significant income, the S-Corp election produces meaningful self-employment tax savings. We analyze your income projections and recommend the appropriate tax classification. Learn more about S-Corp elections. Learn more about disregarded entity status.
Professions That Require a PLLC
The New York State Education Department regulates over 50 licensed professions. The most common professions forming PLLCs include physicians and surgeons, dentists and oral surgeons, attorneys, certified public accountants, architects, professional engineers, veterinarians, psychologists, licensed clinical social workers, physical therapists, occupational therapists, optometrists, pharmacists, registered nurses and nurse practitioners, podiatrists, and chiropractors. If your profession requires licensure through NYSED, you must use the PLLC structure. If you are unsure whether your profession qualifies, contact us and we will confirm.
PLLC vs. Professional Corporation (PC)
Licensed professionals in New York can choose between a PLLC and a Professional Corporation (PC). Both require NYSED approval and restrict membership to licensed professionals. The key differences are structural and tax-related.
PLLCs offer more flexibility in management structure and profit allocation. The operating agreement can be customized to allocate income and losses in any way the members agree to. PLLCs have fewer corporate formalities — no board of directors, no annual meetings, no bylaws requirement. Default taxation is pass-through (disregarded entity or partnership), with the option to elect S-Corp or C-Corp treatment.
PCs follow corporate formalities — board of directors, officers, bylaws, annual meetings, minutes. Profit distribution must generally follow share ownership. Default taxation is C-Corp (double taxation) unless an S-Corp election is made. PCs are sometimes preferred by larger multi-professional groups or by professionals whose contracts or hospital credentialing requirements specify a corporate entity.
For most solo practitioners and small professional groups, the PLLC is the more flexible and tax-efficient structure. We evaluate your specific situation and recommend the right entity.
Professional Liability Insurance
While a PLLC provides limited liability protection for business obligations, it does not protect individual members from their own professional malpractice claims. For this reason, professional liability insurance (malpractice insurance) is essential for every PLLC member. Some professions require malpractice coverage by law or as a condition of licensure. Even where not legally required, carrying adequate coverage is a baseline risk management measure. We can refer you to insurance professionals who specialize in your field if needed.
Multi-Professional PLLCs
New York permits certain related professions to practice together in a single PLLC. For example, physicians and physician assistants can form a PLLC together, as can attorneys and paralegals (with the attorneys as members and paralegals as employees). However, unrelated professions generally cannot form a joint PLLC — a dentist and an accountant cannot be members of the same PLLC. The rules vary by profession, and NYSED evaluates each application. We advise on whether your proposed PLLC membership structure is permissible.
Ongoing Compliance
After formation, a PLLC has ongoing compliance obligations. Every member must maintain a current, valid New York professional license. If a member’s license is suspended, revoked, or lapses, their membership in the PLLC must be addressed — typically through a buyout or withdrawal as specified in the operating agreement. The PLLC must file biennial statements with the Department of State. The PLLC must pay the New York annual filing fee (Form IT-204-LL for multi-member PLLCs). The PLLC must comply with any profession-specific regulatory requirements imposed by the licensing authority. If the PLLC elected S-Corp taxation, ongoing payroll and corporate return filing obligations apply.
How We Help
We handle the full PLLC formation process from start to finish — NYSED application and approval, Articles of Organization, publication requirement, operating agreement, EIN, and tax election. For existing PLLCs, we review and update operating agreements, advise on tax classification changes, handle membership transitions when professionals join or leave, and ensure ongoing regulatory compliance.
Learn more about LLC formation. Learn more about our healthcare law practice.
Contact Us
Call toll-free: (888) 275-2620. Available 24/7.
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Last reviewed by Attorney Ronald S. Cook — April 2026
This page is for informational purposes only and does not constitute legal advice.
