How to Form a Legal Entity for your DPC Practice

Determine what business structure is best for your needs

First, check out your state's guidelines on professional entities. Some states require you to operate as a professional entity (PLLC or PC) instead of a generic equivalent (LLC or Corporation). Here's a state-by-state rundown.

After figuring that out, decide whether an LLC or Corporation is right for you. Basic rule of thumb: if you want to add an additional physician/partner at some point a PC will be easier. If you know you'll stay a one-doc shop forever, a PLLC could make your life easier since it allows pass-through taxation. Basically all business revenue "passes through" the LLC to you and is treated by the IRS as personal income. This eliminates the need to do an independent corporate income tax return.

You may likely want to confer with an accountant to make this decision, or look at other nearby practices.

Draft Articles of Organization/Incorporation

This document serves to create a legal entity and provide basic information about it.

Here is a sample Articles of Organization for an LLC.

Here is a sample Articles of Incorporation for an generic corporation.

Draft an operating agreement/bylaws for the company

This document details the members' business interests and ownership shares, their rights and responsbilities as members, the allocation of profits and losses, and other protocols for managing and operating the business.

Here is a sample Operating Agreement for an LLC.

Here are some sample bylaws for an generic corporation.

When actually drafting this agreement, you and all partners of the practice should meet with a small business lawyer.

Find a registered agent

The role of a registered agent is explained in this video. It's almost always a good idea.

Incorporate the business through your state

This can usually be done online through your states business center - just Google "[state] business entity formation". You'll need your Articles of Incorporation/Organization.

File a DBA with your state

Unless you want to have "Awesome Direct Primary Care, PLLC" as your patient-facing brand, you should file a DBA (Doing Business As) form with your state. This allows you to legally operate under a different name ("Awesome DPC"). This form may also be called a Fictitious Business Name (FBN) form in some states. Google "how to file dba [your state]" for instructions.

Apply for your Employer Identification Number (EIN)

The EIN is like the Social Security number for your business. It's the number the IRS uses to identify you. You can apply for one online here - it's painless.