Forming a Professional Licensed Clinical Social Worker Corporation in San Diego

California law allows healing arts professionals, like licensed clinical social workers, to form professional corporations through which to operate their practices. In particular, in 1968, the State Assembly enacted the Moscone-Knox Professional Corporation Act (the “Moscone-Knox Act” or the “Act”). See Cal. Corp. Code, §13400 et seq. The Moscone-Knox Act provides that various listed professions may form California professional corporations. This is good for professionals practicing in California because the corporate form protects the personal and family financial assets of the professional. In general, if a professional is in practice as a sole proprietor and there is a judgment from a slip and fall accident, for example, the judgment could be collected against personal assets. However, if the judgment is won against a corporation, then the creditors can only seize business assets. There are other advantages to using a California professional corporation to operate your practice. An experienced San Diego corporate attorney can provide advice and counsel on setting up your professional licensed clinical social worker corporation.

The Moscone-Knox Act provides a specific list of medical and health care professionals that are allowed to form professional corporations. Among the list are licensed medical doctors, optometrists, registered nurses, midwives, and more, including licensed clinical social workers. As a general rule, to operate any sort of professional practice through the corporate form, you must form a professional corporation in California if your profession is included in the Moscone-Knox Act. The California courts have held that professionals in California cannot use any other form like a standard corporation or a limited liability company. Contact an experienced San Diego corporate attorney to ensure your professional licensed clinical social worker corporation is properly formed.

A California professional licensed clinical social worker corporation is created in the same manner as a regular corporation. Articles of Incorporation are filed with the California Secretary of State, bylaws are adopted that include special provisions unique to professional licensed clinical social worker corporations, directors and officers are appointed, and securities are issued. There are rules with respect to naming, so the name you choose must be unique and must include the words “licensed clinical social worker”, as well as a corporate designator in order to be compliant.

The Moscone-Knox Act also restricts who may own California professional licensed clinical social worker corporation. At least 51% of the shares must be owned by licensed clinical social workers. The remaining shares can be owned by a variety of licensed professionals which are licensed physicians and surgeons, licensed psychologists, licensed marriage and family therapists, registered nurses, licensed chiropractors, licensed acupuncturists, naturopathic doctors, and licensed professional clinical counselors. There are similar restrictions with respect to who may serve on the board of directors and who may be hired as senior management. Here again, an experienced San Diego corporate attorney can provide advice and counsel on these issues.

Contact San Diego Corporate Law

For more information, call Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard focuses his practice on business law, transactional, and corporate matters, and he proudly provides legal services to business owners in San Diego and the surrounding communities. Mr. Leonard can be reached at (858) 483-9200 or via email. Like us on Facebook.

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