What is the primary benefit of a professional corporation for its members?

The primary benefit of a professional corporation for its members is limited liability protection. This structure allows professionals, such as doctors, lawyers, and engineers, to limit their personal liability for the debts and obligations of the corporation. If the corporation faces a lawsuit or incurs debt, the personal assets of the members are generally protected from being seized to satisfy those claims, except in cases of malpractice or personal wrongdoing.

This protection encourages professionals to collaborate and practice together while safeguarding their personal finances. Even though professional corporations have specific regulatory requirements and may be subject to different tax considerations, the fundamental advantage of limiting personal liability remains a significant factor in the decision to establish a professional corporation.

While lower tax rates, increased funding opportunities, and control over all decisions can be appealing aspects of various business structures, none provide the same level of personal asset protection offered by a professional corporation, which is critical for members who may face high liability risks in their professional practices.