Florida Law Firm Corporations: Guide for Attorneys (2026)

A Florida law firm corporation is a Professional Association (P.A.), a professional service corporation owned only by Florida Bar members. It costs $70 to file, shields you from the firm’s business debts and your colleagues’ malpractice, and lets you elect S-Corp taxation. It won’t protect you from your own malpractice, and it doesn’t loosen a single Florida Bar rule.

Your other main choice is a professional limited liability company (PLLC). Here’s how the two compare, and what the Bar expects of you either way.

Why do attorneys incorporate?

Liability comes first. You stay personally liable for your own malpractice, but a P.A. protects your home, savings and investments from the firm’s general debts, from contract and employment claims against the firm, and from the malpractice of other attorneys in the firm.

Taxes come second. A P.A. can elect S-Corp status and split your income between salary and distributions, which can cut self-employment tax compared with a sole proprietorship or partnership. More on that below.

There are softer reasons too. “Smith Law, P.A.” tells clients and colleagues the practice is formally structured. Stock transfers and buy-sell agreements also make it simpler to bring in partners, set up profit-sharing, retire or sell. Ownership is still limited to licensed attorneys, though.

What does the Florida Bar allow?

Under Rule 4-8.6(a) of the Rules Regulating The Florida Bar, you can practice law through five types of entity:

Sole proprietorship
General partnership
Limited liability partnership (LLP)
Professional service corporation, known as a Professional Association (P.A.)
Professional limited liability company (PLLC)

Whichever you choose, the Bar’s rules on client protection and professional independence apply in full.

Rule 4-5.4 bars lawyers from sharing legal fees with non-lawyers and from forming partnerships with non-lawyers when the partnership includes practicing law. Florida considered loosening this. In November 2021, the Florida Bar Board of Governors unanimously voted against allowing non-lawyer minority ownership, and the Florida Supreme Court affirmed that position in March 2022. So outside investors are still out.

Rule 4-7.21(f) also bars you from stating or implying that you practice in a partnership or other organization unless one actually exists. Don’t call yourself “Smith and Jones” unless there’s a real partnership or professional association behind the name.

Should a law firm be a P.A. or a PLLC?

Both protect your personal assets from firm debts and other attorneys’ malpractice to the same degree. The differences are in administration and taxes.

Feature	P.A.	PLLC
Governing law	Chapter 621, Florida Statutes	Chapters 605 and 621, Florida Statutes
Management	Board of directors, officers (president, secretary, treasurer), shareholder meetings	Member-managed or manager-managed
Formalities	Annual meetings, written resolutions, detailed records	Operating agreement and records of major decisions; no required annual meetings for routine matters
Default tax	C-Corporation	Pass-through
Florida reputation	The traditional designation in Florida’s legal community	Less traditional, increasingly accepted

A P.A. is taxed as a C-Corporation by default. The firm pays Florida’s 5.5% corporate income tax on profits and shareholders pay personal income tax on dividends. That’s why most law firm P.A.s elect S-Corp status to get pass-through treatment. A P.A. also has to keep up its corporate formalities, because letting them lapse can put the liability protection at risk.

Most Florida law firms choose the P.A. for its recognition and familiar structure, and solo practitioners and small firms often prefer the PLLC because it’s simpler to run. We’d go with the P.A. if you’ll have several owners or plan to elect S-Corp status anyway, since you’ll be running payroll and keeping records either way. If you’re solo and want the lightest administrative load, the PLLC is the easier entity to live with.

Who can own a Florida law firm?

Only licensed attorneys. Every shareholder in a P.A., or member in a PLLC, needs an active Florida Bar license. Chapter 621 requires owners to be licensed to provide the services the firm offers. Non-attorney investors, family members and business managers can’t own any part of the firm, not even a minority stake.

If an owner’s license goes inactive, is suspended or ends in disbarment, they have to divest. Put mandatory buyout terms in your articles or operating agreement so that’s handled automatically.

Attorneys licensed in other states can own an interest only if they’re also admitted to The Florida Bar or otherwise authorized to practice in Florida courts. Multi-state firms have to structure ownership around each state’s rules.

When an attorney-owner dies, the estate or beneficiaries can be paid for the ownership interest even if they aren’t lawyers. They can’t become active shareholders or take part in management. Most shareholder agreements require the firm or the remaining owners to buy the shares within a set period.

What do you have to call it?

A P.A.’s official name must include “Professional Association,” “P.A.” or “Chartered.” It can’t use “Incorporated,” “Inc.,” “Corporation,” “Corp.” or “Company,” which belong to ordinary business corporations and would mislead clients about what kind of entity you are.

A PLLC must include “Professional Limited Liability Company” or “PLLC.” A plain “LLC” is for non-professional companies.

You can register a fictitious name (DBA) with the Florida Division of Corporations if you want to practice under a different name, but your client communications and official documents still have to show the entity type. “Smith Law” still needs “P.A.” Check that your name is distinguishable from existing entities on the Sunbiz database before you file.

Which ethics rules need extra attention once you incorporate?

Incorporating doesn’t change your duties under the Florida Rules of Professional Conduct. A few become more work:

Confidentiality. Every employee, including non-attorney staff, has to protect client information. You’re responsible for training them and putting safeguards in place.
Conflicts. Conflicts attach to the firm. When one attorney has a conflict, the others usually inherit it, so run conflict checks across every attorney and keep complete engagement records.
Supervision. Rule 4-5.3 requires you to supervise non-lawyer employees so their conduct meets your professional obligations. That responsibility grows as the firm does.
Engagement letters. Name the P.A. or PLLC as the service provider, have the entity sign, and identify the responsible attorneys so the client knows who’s handling the matter.
Independence. Each attorney remains professionally responsible for their own legal judgment. Shareholders and managers can’t pressure anyone to violate ethics rules for business reasons.

What liability protection do attorney-shareholders actually get?

Protected	Not protected
Business debts and contracts (rent, vendors, loans)	Your own malpractice and ethics violations
Employment claims by staff	Malpractice by an attorney you supervised
General tort claims, such as a slip-and-fall at the office	Personal guarantees you signed for loans or leases
Other attorneys’ malpractice when you had no supervisory role	Intentional torts, fraud and criminal conduct

Supervision is the line to watch. If you supervised the attorney who committed the malpractice, you may be personally liable even inside the corporation. Senior partners and managing attorneys carry more exposure.

So keep malpractice coverage for every attorney and for the firm itself. And protect the corporate shield by holding the required meetings, keeping firm and personal money separate, capitalizing the firm properly, and documenting major decisions. Courts typically pierce the corporate veil when attorneys commingle funds, undercapitalize the firm or ignore formalities.

What are the fee-sharing and referral rules?

Rule 4-5.4 bans sharing legal fees with non-lawyers, with narrow exceptions:

Payments to a deceased lawyer’s estate or beneficiaries for work done before death
Including non-lawyer employees in a compensation plan, as long as bonuses aren’t calculated as a percentage of legal fees
Court-awarded fees that include paralegal costs

Splitting fees with lawyers at other firms has its own limits. In contingency cases involving personal injury, wrongful death and products liability, the lawyer who takes primary responsibility must receive at least 75% of the total fee, and the referring lawyer can receive no more than 25%. A bigger share for the referring lawyer is presumed clearly excessive unless they had “substantially equal active participation” in the case, which requires court approval.

Any fee split must be confirmed in writing, and the client must give written consent after full disclosure. The fee agreement should explain how the fee is divided and which attorney has primary responsibility.

How do trust accounts work for an incorporated firm?

Chapter 5 of the Rules Regulating The Florida Bar governs trust accounts, and it applies the same way to a P.A. or PLLC.

Client funds that are nominal in amount or held short-term go into an Interest on Trust Accounts (IOTA) account for The Florida Bar Foundation, which funds civil legal services for low-income Floridians. You decide in good faith whether funds are nominal or short-term based on the amount, how long you expect to hold them, the likelihood of delays, and the cost of setting up an interest-bearing account. Larger or longer-term funds that can earn more than the administrative cost belong in a separate interest-bearing trust account for that client.

Title the account with your name or the firm’s name followed by “trust account,” for example “Smith Law, P.A. Trust Account.” Don’t put The Florida Bar or the Foundation in the title.

When you open an IOTA account, send The Florida Bar Foundation:

The account number from the financial institution
The attorney or firm name on the account
The financial institution’s name and address
The attorney’s name and Florida Bar number

Rules 5-1.1 and 5-1.2 require detailed records of every deposit and disbursement and monthly reconciliations. Violations can bring severe discipline. You also have to certify in writing each year that you comply with, or are exempt from, the IOTA rules. The account may be in the firm’s name, but compliance is the individual attorneys’ responsibility, not the corporation’s.

Is an S-Corp election worth it for a Florida law firm?

For most profitable firms, yes. That’s why most Florida law firm P.A.s make it.

An S-Corp passes profits through to the shareholders’ personal returns with no entity-level tax, so you avoid the C-Corp’s double taxation. Florida has no individual income tax and automatically recognizes the federal election, so you only file IRS Form 2553. There’s no separate state election.

Where the savings come from

Sole proprietors and partners pay 15.3% self-employment tax (12.4% Social Security, which applies only up to the annual Social Security wage base, plus 2.9% Medicare). An extra 0.9% Medicare tax applies on income over $200,000.

As an S-Corp shareholder working in the firm, you split your pay. Part is salary, subject to payroll taxes. The rest is distributions, which aren’t subject to self-employment tax. How much you save depends on your income and the salary you set, so have a CPA run your actual numbers before you elect.

How much salary do you have to take?

The IRS requires “reasonable compensation” before distributions. It looks at:

Pay for similar legal work in your area
Your role and responsibilities
Hours worked
Firm profitability
Your experience and qualifications

Law firms get extra scrutiny because nearly all their value comes from the attorneys’ own services. For a solo practitioner, reasonable compensation is often most of the firm’s profit. Multi-attorney firms have more room to allocate income among shareholders.

Many tax advisors recommend paying attorney-shareholders at least 60-70% of their profit share as salary. We’d stay in that range. Cutting salary aggressively is how firms end up in an audit with their distributions reclassified as wages.

How to elect

Form your P.A. with the Florida Division of Corporations.
Get an EIN from the IRS.
File Form 2553 (Election by a Small Business Corporation) within 2 months and 15 days of the start of your tax year, or at any time during the preceding tax year.
Stay eligible: all shareholders must be U.S. citizens or residents, there can be no more than 100 shareholders, and there can only be one class of stock.

A PLLC can also elect S-Corp taxation by filing Form 2553. Many don’t, and simply keep the default pass-through treatment, which is simpler and still avoids double taxation.

How should you plan for succession?

Every multi-attorney firm needs a buy-sell agreement. It should cover:

How ownership interests are valued
Triggering events: retirement, death, disability, voluntary departure and termination
Payment terms and financing
Non-compete and client solicitation restrictions
How disputes get resolved

For retirement, a corporation lets senior attorneys transfer stock to junior attorneys gradually, keeping income while cutting back on work. Fix the valuation formula and payment schedule in advance.

For death and disability, require the firm or remaining shareholders to buy the shares. Life insurance can fund a death buyout without straining the firm, and disability insurance with buyout provisions covers long-term disability.

The harder part is that a law firm’s value is mostly client relationships, not assets. Your plan needs a way to move clients to successor attorneys. When an attorney leaves or retires, client files must be transferred under the professional responsibility rules, and clients should be told and allowed to stay or follow the departing lawyer (subject to any non-solicitation agreement).

Think about taxes too. Installment sales, redemptions and cross-purchase arrangements are taxed differently, so get tax advice before any large transfer. And remember the hard limit: you can’t sell the practice to a non-lawyer or leave it to a non-lawyer relative. That leaves fewer exit options than most businesses have.

What do you report to the Florida Bar?

The Bar doesn’t require a separate registration for an incorporated firm beyond each attorney’s own license. You still have ongoing obligations:

Annual Bar fees for each attorney, whatever the firm’s structure.
Trust account certification each year for attorneys who handle client funds.
Name changes reflected in your Florida Bar membership records.
Malpractice insurance. Florida doesn’t require it for private practitioners, but if you don’t carry it you must disclose that to clients in writing. Many firms buy it anyway as basic risk management.

Separately, the P.A. or PLLC must stay active with the Florida Division of Corporations by filing annual reports, paying the fees and keeping a registered agent in Florida to receive legal papers.

How do you set up a Florida law firm corporation?

Pick the entity. P.A. or PLLC, based on how you want to manage the firm and how much administration you’ll take on.
Choose the name. Include “P.A.” or “PLLC,” confirm availability on Sunbiz, and check domain names and trademarks.
Appoint a registered agent with a physical Florida street address (no P.O. box). You can serve yourself, name an attorney in the firm, or hire a commercial registered agent service.
Draft the formation document. For a P.A., Articles of Incorporation with the name, a single purpose statement (practicing law), principal office address, registered agent name and address, incorporator name and address, and authorized stock. For a PLLC, Articles of Organization with the name, principal office address, registered agent, management structure and a description of the professional service.
File with the Division of Corporations online at Sunbiz.org or by mail. The fee is $70 for a corporation and $125 for an LLC. Mail filings typically take 5-10 business days, and online filings with expedited service can be immediate.
Get an EIN online at IRS.gov.
Write bylaws or an operating agreement covering owner rights, management, meetings, profit distribution, admitting new owners, transfer restrictions and dissolution.
Hold the organizational meeting to adopt the governing document, elect directors and officers (or designate managers), authorize stock or membership interests, adopt banking resolutions and approve major contracts.
Issue stock or membership certificates to the attorney-owners and keep a stock ledger or membership register.
Get local licenses, including a local business tax receipt and any municipal or practice-area registrations.
Open bank accounts, both an operating account and an IOTA trust account, and notify The Florida Bar Foundation about the trust account.
File Form 2553 if you’re electing S-Corp status, within the deadline above.
Buy insurance: professional liability, general liability, workers’ compensation if you have employees, and cyber liability, given how much sensitive client data law firms hold.

From then on, file the annual report, pay Bar fees, keep up trust account compliance and certification, hold board meetings with minutes (for a P.A.), keep firm finances separate, and keep your registered agent information current.

Our take

If you already practice solo and file a Schedule C, the decision that matters isn’t really P.A. versus PLLC. It’s whether your profit is high enough for an S-Corp election to pay for the payroll and bookkeeping it adds. Ask your CPA that question first. Once you know the answer, the entity choice usually follows.

This article is general information about Florida law firm corporations, not legal or tax advice. Talk to a business lawyer and a tax professional before choosing and structuring your entity.

Florida Law Firm Corporations: Complete Guide for Attorneys