Nevada, like many other states, generally prohibits what is called the “corporate practice of medicine.” This means that a general business corporation or company cannot practice medicine or employ a physician to provide medical services.In other words, if you want to start a medical practice, you cannot form a regular corporation or LLC as another business would.
What are your options for starting a medical practice?
You have several options. First, you can be a Sole Proprietor. This means you will be practicing medicine under your own name. You and your practice have no legal separation.
You can also form a Partnership if you are working with other licensed physicians. A partnership is formed when two or more persons carry on as co-owners of a business for profit. No express, written agreement is required to form a partnership.
Nevada law also allows physicians to create entities called “Professional Corporations” or “Professional Limited Liability Companies.”
What does it matter?
As sole proprietorship or as a partner in a partnership you are personally liable for the debts and liabilities of the practice. Additionally, a partnership can leave you personally liable for the acts of any of your partners.
In contrast, a Professional Corporation or a Professional LLC protects your personal assets from the general debts and liabilities of your practice. This is one of the main benefits of creating a professional corporation or LLC. Please note, however, that these entities will not protect your personal assets from liability for torts such as professional negligence. So you must be sure to maintain appropriate insurance coverage.
In addition to limiting your personal liability, a profession corporation or LLC can provide you with structure and tax advantages that can help you keep your hard earned money in your pocket – although I would generally advise against keeping large amounts of money in your pocket.
