Formation and Dissolution (KY Professional Service Corporation)

Summary

This practice note discusses Kentucky state law concerning the operation and dissolution of professional corporations (PCs) also referred to as professional service corporations. A PC allows specified professionals to practice their profession through a corporation. It operates like a corporation and is generally subject to the general business corporation law of its state of incorporation, as well as the state’s specific professional service corporation statutes and the regulations of the state licensing board for the relevant profession. Unlike a business corporation, a PC cannot engage in any business other than rendering the professional service for which it was formed. If properly formed and operated, the PC shields its shareholders from liability for most of the debts, liabilities, and obligations of the PC. However, each individual who renders professional services is liable for their own negligence or wrongful acts as a service provider.