Business formation folders and a closed laptop on a lamp-lit desk, Florida PLLC vs Professional Association (P.A.)

Florida PLLC vs Professional Association (P.A.): Which Licensed Professionals Need One

Florida PLLC vs Professional Association (P.A.): Which Licensed Professionals Need One

Informational only. This guide explains Florida professional entity rules in general terms. It is not legal or tax advice. Your licensing board, your attorney and your CPA can tell you how these rules apply to your practice, so confirm details with them before you file.

If you are a licensed doctor, lawyer, CPA, engineer or architect planning to practice with one or more partners, you will likely compare two entity types: the Florida PA (professional association) and the Florida PLLC (professional limited liability company). Both are built for licensed practices, both are formed under the same Florida law, and both are often called a “professional entity.” They are still different entity types. They have different name rules, different annual report mechanics and different default tax treatment. This guide explains which one fits, what Florida requires and where to confirm each figure.

The short answer

A PLLC is a limited liability company formed to render a licensed professional service. A P.A. is a professional corporation formed for the same purpose. Both fall under Florida’s Professional Service Corporation and LLC Act, chapter 621 of the Florida Statutes. The general LLC and corporation statutes, chapters 605 and 607, apply where chapter 621 is silent.

Choose a PLLC if you want LLC-style management and the tax flexibility that comes with a partnership or disregarded entity classification. Choose a P.A. if you specifically want a corporation, or if your accountant recommends corporate tax treatment for your practice.

What chapter 621 requires

Chapter 621 controls who can own these entities and what they must call themselves. Three rules matter most:

  • Owners must be licensed. Every owner must be licensed, or otherwise legally authorized, to render the same professional service the entity provides. A licensed dentist cannot own a law firm PLLC, for example.
  • Names are specific. Under section 621.12, a P.A. name must include “chartered,” “professional association” or “P.A.” A PLLC name must include “professional limited liability company,” “P.L.L.C.” or “PLLC.”
  • No approval under ch. 621 itself. Chapter 621 does not require board approval to form the entity. Some boards, however, require a separate firm license or certificate of authorization. Check with the board that licenses your profession before you sign formation documents.

Who can form one

The statute covers licensed professions broadly, and doctors, lawyers, CPAs, engineers and architects are the common examples. The test is not the profession’s name. The test is whether every owner holds a license, or other legal authorization, for the same professional service. Mixing owners who hold different licenses raises board and ownership questions that a form filing cannot answer. Do not assume a mixed-license structure works until your board and an attorney confirm it.

Do you have to use one?

Florida does not require every licensed professional to use a PLLC or P.A. Whether you must depends on your profession, your board’s rules and how you plan to practice. Some licensees practice as sole proprietors. Before you assume a standard LLC or corporation can render your profession, ask your board. The professional entity route under chapter 621 is designed for licensed practices, which is why it is the usual starting point for group practices.

PLLC vs P.A. side by side

FeaturePLLCP.A.
Entity typeLimited liability companyProfessional corporation
Required name wording“Professional limited liability company,” “P.L.L.C.” or “PLLC”“Chartered,” “professional association” or “P.A.”
Statutes that fill gapsChapter 605Chapter 607
Standard formation filing fee$125 (Articles of Organization)$70 (Articles of Incorporation)
Annual report fee$138.75 ($538.75 if filed after May 1)$150 ($550 if filed after May 1)
Registered agent designation$25 (included in the $125)$35 (included in the $70)
Florida tax treatmentPartnership or disregarded entity generally files no Florida corporate return, unless it is classified as a corporationSubject to the 5.5% Florida corporate income tax

These are the published figures for a standard LLC and profit corporation. Confirm the amount that applies to your professional filing on Sunbiz before you pay, because the filing type and any added documents can change the total.

Step-by-step formation

  1. Confirm eligibility with your board. Ask whether your profession needs a firm license or certificate of authorization in addition to the Sunbiz filing. Get the answer in writing if you can. Board information is available through the Florida Department of Business and Professional Regulation at myfloridalicense.com.
  2. Search the name. Check availability in the Sunbiz records at search.sunbiz.org. The name must include the required suffix and be distinguishable on Division of Corporations records. Do not treat a name as approved until you receive a filing acknowledgment.
  3. Reserve the name if needed. A name reservation lasts 120 days and costs $25.
  4. Appoint a registered agent. Every Florida LLC and corporation must designate a registered agent with a physical Florida street address. A P.O. box does not qualify. The agent must sign to accept the appointment. Your entity cannot serve as its own agent, but an individual owner or officer may. The designation fee is $25 for an LLC and $35 for a corporation.
  5. File with the Division of Corporations. PLLCs file Articles of Organization. Online filing goes through Sunbiz eFile at dos.fl.gov/sunbiz/start-business/efile/fl-llc. P.A.s file Articles of Incorporation for a Florida profit corporation through the Division’s main Sunbiz site at dos.fl.gov/sunbiz.
  6. Get your federal EIN from the IRS, then open any bank account in the entity’s name.
  7. Obtain any board license or firm certificate your profession requires before you accept clients.
  8. Check local and tax registrations. Florida issues no general statewide business license. Many cities and counties require a local Business Tax Receipt for the place you operate, issued under chapter 205. It is a tax, not a competency license, and not every county or city levies it. Confirm with your local tax collector. If you sell taxable goods or services, register as a sales and use tax dealer with the Florida Department of Revenue before you begin business. The state sales tax rate is 6%.

Processing time and walk-in options

The Division publishes no guaranteed turnaround time. It says online filings are processed in the order received, and images of electronically filed documents post within 3 business days of processing. Non-electronic filings take up to 5 business days to post. The Division does not offer expedited service. If you need speed, walk-in service is available at 2415 N. Monroe Street, Suite 810, Tallahassee, Monday to Friday, 8am to 5pm, where most requests are completed while you wait.

Annual reports and deadlines

Both entity types file an annual report each year between January 1 and May 1. The annual report fee is $138.75 for an LLC and $150 for a profit corporation. A $400 late fee applies to reports received after May 1. A PLLC that fails to file by the third Friday in September faces administrative dissolution, so treat May 1 as the hard deadline and calendar it every year. If your practice operates under a name different from the entity name, you also need a fictitious name registration, which costs $50 to register and $50 to renew. Registration is valid for 5 years.

Tax treatment in plain terms

Florida has no personal income tax and no state franchise tax for LLCs. How the entity is taxed depends mostly on its federal classification:

  • A PLLC classified as a partnership or disregarded entity generally does not file a Florida corporate income tax return. A Florida Partnership Information Return is required if one or more owners is a corporation, and any corporate owner must file its own Florida corporate income or franchise tax return.
  • A PLLC classified as a corporation for federal tax purposes pays the 5.5% Florida corporate income and franchise tax.
  • A P.A. is a corporation, so plan for the 5.5% Florida corporate income tax on its Florida net income for tax years beginning on or after January 1, 2022.

Which federal classification fits your practice is a CPA decision. Get that answer before you choose the entity type, because the Florida result follows from it.

Common mistakes

  • Using a name without the required chapter 621 suffix.
  • Assuming a name is approved before you receive a filing acknowledgment.
  • Skipping the board firm license or certificate of authorization.
  • Giving ownership to someone who does not hold the same license or legal authorization.
  • Missing the May 1 annual report deadline and paying the $400 late fee.
  • Listing a P.O. box as the registered agent address.
  • Treating the local Business Tax Receipt as a professional license.

When to bring in professionals

Talk with a Florida attorney before you finalize ownership terms, buy-sell provisions, or any arrangement with owners who hold different licenses. Ask a CPA which federal classification and Florida tax treatment fit your numbers. Ask your board whether a firm license applies. As a general matter, a professional entity does not shield a licensee from personal liability for his or her own professional negligence, so review your liability exposure and insurance with an attorney and your insurer.

Official resources

Keep exploring: related Florida guides