Form Your Chiropractic Professional Corporation
Complete guide to incorporating your chiropractic practice in California. Understand BCE requirements, ownership restrictions, scope of practice, and the formation process.
Why Form a Chiropractic Professional Corporation?
California chiropractors who want corporate liability protection must form a Professional Corporation (PC) under the Moscone-Knox Act. Standard LLCs and corporations cannot provide chiropractic services.
Liability Protection
Separate personal assets from practice liabilities. Shareholders aren't personally liable for corporate debts, though malpractice liability remains personal.
Tax Advantages
Choose C-Corp or S-Corp taxation. S-Corp status can significantly reduce self-employment taxes for profitable practices.
Professional Credibility
Corporate structure signals established practice. Many payers and referral sources prefer incorporated practices.
Multiple DC Practices
Group multiple chiropractors under one entity with defined ownership, governance, and profit-sharing arrangements.
Practice Limitations
A chiropractic PC can ONLY provide chiropractic services. Offering massage therapy, acupuncture, or PT may require separate entities or licensed professionals under appropriate supervision.
BCE Registration
No BCE pre-approval required to form, but you must maintain an active DC license and comply with all BCE practice regulations.
Who Can Own a Chiropractic Professional Corporation?
California law strictly limits ownership of chiropractic professional corporations to licensed chiropractors.
- ✓ Licensed California Doctors of Chiropractic (DC)
- ✓ Trusts where beneficiary is a licensed DC
- ✓ Other chiropractic professional corporations
- ✓ Estates of deceased DCs (temporary, for transfer)
- ✗ Physicians (MDs/DOs) or other healthcare professionals
- ✗ Non-licensed individuals (spouses, investors)
- ✗ Standard LLCs or corporations
- ✗ Private equity firms or management companies
- ✗ Physical therapists, massage therapists, or acupuncturists
Director & Officer Requirements
All directors must be licensed DCs. The president (or chair) must be a licensed chiropractor. Officers performing non-professional duties may be unlicensed.
License Loss = Share Forfeiture
If a shareholder's DC license is revoked, suspended, or lapses, they must transfer shares to a qualified licensee within 90 days. Bylaws must address this requirement.
How to Form Your Chiropractic Professional Corporation
Follow these steps to properly incorporate your chiropractic practice in California.
Choose Your Corporate Name
Name must comply with BCE advertising rules. Typically includes the licensee's name and "Chiropractic" designation.
- "[Name] Chiropractic, A Professional Corporation"
- "[Name] Chiropractic, Inc."
- "[Practice Name] Chiropractic Professional Corporation"
Draft Articles of Incorporation
Articles must identify the entity as a professional corporation and specify chiropractic as the purpose.
- Professional corporation statement
- Purpose: "To engage in the profession of chiropractic"
- Reference to Business and Professions Code
- Incorporator must be licensed DC
File with Secretary of State
Submit Articles of Incorporation with the required filing fee.
Processing: 3-5 business days standard
Expedite: 24-hour available
Organizational Meeting & Bylaws
Adopt bylaws, elect directors, appoint officers, and issue shares.
- DC licensure requirements for shareholders
- Automatic disqualification provisions
- Share transfer restrictions
Obtain EIN & Tax Registration
Apply for federal EIN and register with California FTB.
S-Corp election: Form 2553 within 75 days
File Statement of Information
File within 90 days of formation, then annually thereafter.
Required info: Officers, directors, registered agent
Formation and Ongoing Costs
Budget for both initial formation and ongoing compliance expenses.
| Item | Cost | Frequency |
|---|---|---|
| Articles of Incorporation Filing | $100 | One-time |
| Statement of Information | $25 | Annual |
| California Franchise Tax | $800 | Annual |
| Registered Agent Service | $50-$300 | Annual |
| Legal Fees (Formation) | $1,500-$3,500 | One-time |
| DC License Renewal | $505 | Biennial |
| Accounting & Tax Prep | $1,000-$3,000 | Annual |
Board of Chiropractic Examiners Requirements
The BCE regulates chiropractic practice in California. Maintain compliance with all practice regulations.
License Verification
All shareholders, directors, and practicing chiropractors must maintain active, unrestricted California DC licenses. Verify at the BCE website.
Continuing Education
DCs must complete 24 hours of BCE-approved CE every 2 years, including 4 hours of adjustive technique. Maintain records for at least 4 years.
Advertising Standards
All advertising must be truthful, include the DC's name and license number. Avoid misleading claims about results or qualifications.
Patient Records
Maintain records for 5 years after the last treatment (or until minor reaches 21). Document examination findings, diagnosis, and treatment provided.
X-Ray Requirements
X-ray equipment must be registered with California DPH Radiologic Health Branch. Chiropractors must maintain radiation safety training certificates.
Prohibited Practices
Cannot prescribe medications, perform surgery, or practice medicine. Scope is limited to chiropractic analysis and adjustment. Auxiliary procedures require proper training documentation.
Chiropractic Scope of Practice in California
Understanding what DCs can and cannot do is essential for proper corporate structure and risk management.
| Service/Procedure | Status | Notes |
|---|---|---|
| Spinal Adjustment/Manipulation | Permitted | Core scope of practice |
| Extremity Adjustment | Permitted | Part of chiropractic scope |
| Physical Therapy Modalities | Limited | Permitted as auxiliary procedures with training |
| Diagnostic Imaging (X-ray) | Permitted | With DPH registration and safety training |
| Nutritional Counseling | Permitted | Non-prescriptive recommendations only |
| Prescription Medications | Prohibited | Outside scope; refer to MD/DO |
| Injection Therapies | Prohibited | Not in California DC scope |
| Acupuncture | Prohibited | Requires separate L.Ac license |
| DOT/CDL Examinations | Permitted | With FMCSA medical examiner certification |
Multi-Disciplinary Practice
To offer services outside chiropractic scope (massage, acupuncture, PT), you need appropriately licensed professionals. Consider an MSO structure if you want to integrate multiple disciplines under one brand.
Collaborative Care
Chiropractors can work alongside MDs, PTs, and other providers. Ensure proper referral protocols and avoid fee-splitting arrangements that violate healthcare regulations.
Frequently Asked Questions
No. California restricts chiropractic PC ownership to licensed chiropractors only. MDs cannot be shareholders. However, you can have referral relationships and collaborate on patient care through proper inter-professional arrangements.
Yes, but carefully. Licensed massage therapists can be employees, but massage services should be billed appropriately and not represented as chiropractic services. Consider separate billing/coding and ensure proper supervision structures.
Typically yes, if your practice nets more than $40,000-$50,000 annually. S-Corp status allows you to take some income as distributions (no self-employment tax) rather than all as salary. Consult a CPA to model your specific situation.
Issue new shares to the incoming DC (who must have an active CA license). You'll need a shareholder agreement covering buy-sell provisions, valuation methods, and governance. Consider vesting schedules for new partners.
Yes. One PC can operate multiple clinic locations. Each location needs proper permits/licenses. Ensure adequate DC coverage at each location, as supervision requirements apply.
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