Forming a Professional Limited Liability Company (PLLC) in New Hampshire: Statutory Rules and Licensing
To form a Professional Limited Liability Company (PLLC) in New Hampshire, all members must hold an active, state-issued professional license for the specific service provided. A PLLC protects your personal assets from general business debts and the malpractice of your partners.
When licensed professionals decide to start a business in New Hampshire, they face unique legal liabilities that standard retail or service businesses do not. Whether you are opening a dental practice in Manchester or an architectural firm in Nashua, your state-issued license requires you to adhere to strict ethical and legal standards. To operate as a formal business entity while maintaining these standards, the state requires certain professions to form a Professional Limited Liability Company (PLLC) rather than a standard LLC.
Forming a PLLC offers significant benefits, but it also comes with stringent regulatory hurdles. Unlike standard businesses, you cannot simply file formation documents online and start operating the next day. You must first prove to the state that you and your partners are legally authorized to practice your profession. Navigating this intersection between corporate law and professional licensing is complex. Consulting a business lawyer from our directory can help you structure your PLLC correctly from day one.
Understanding RSA 304-D and Eligible Professions
In New Hampshire, PLLCs are governed specifically by N.H. Rev. Stat. Ann. § 304-D:1 et seq. This statute dictates that a PLLC may only be formed to render a specific professional service, and all members (owners) and managers must be licensed to perform that exact service. You cannot have a 'silent partner' who acts only as an investor if they do not hold the required professional license.
Doctors, Lawyers, CPAs, and Architects
Not every business qualifies as a professional service. Under New Hampshire law, a professional service is one that requires obtaining a license, registration, or certification before it can be legally performed. This typically includes accountants, architects, attorneys, chiropractors, dentists, engineers, pharmacists, physicians, and veterinarians. For example, if you are setting up a law firm in Concord, you must operate as a PLLC or a Professional Corporation (PC); a standard LLC is generally not permitted for the practice of law.
State Licensing Board Pre-Approval Steps
A critical consideration when forming a PLLC is coordinating with your professional regulatory board. For most professions, general registration of a PLLC does not universally require attaching prior board approval directly to your initial formation filing with the New Hampshire Secretary of State, Concord. However, all members must hold active licenses in good standing, typically regulated by licensing boards overseen by the Office of Professional Licensure and Certification, Concord. Certain professions may require pre-clearance for regulated entity names, or mandate post-formation entity authorization and practice permits before providing services to the public.
To formally create the entity, you submit Form PLLC-1, New Hampshire, Secretary of State, Certificate of Formation - Professional Limited Liability Company directly to the Corporation Division. The filing must specifically describe the professional service being offered under RSA 304-D, verifying that all owners and managers possess the legal qualifications required by state law.
Personal Malpractice Liability Protections vs. General Business Debts
The primary reason professionals choose to form a PLLC is liability protection. However, it is vital to understand exactly what the corporate veil protects against, and what it does not. In New Hampshire corporate jurisprudence, as demonstrated in Norwood Group, Inc. v. Phillips, 149 N.H. 722 (NH Supreme Court 2003) regarding actions on judgments, courts respect the separate identity of an entity unless the business form is used to promote fraud or other injustice.
In a PLLC, the liability shield protects your personal assets (like your home or personal bank accounts) from general business debts. If the PLLC breaks a commercial lease in Portsmouth or fails to pay a medical equipment vendor, the creditors generally cannot sue you personally. Furthermore, the PLLC protects you from the malpractice of your partners. If your co-owner commits professional negligence, their personal assets and the business assets are at risk, but your personal assets remain shielded.
Crucially, a PLLC does not protect you from your own malpractice. If you personally commit professional negligence, the patient or client can sue you individually. Therefore, carrying robust professional liability insurance (malpractice insurance) remains absolutely necessary for all PLLC members.
How Much Does it Cost in New Hampshire?
Forming a PLLC involves several fees, both to the state and potentially to your licensing board.
| State Filing Fee | $100 to the NH Secretary of State |
| Licensing Board Review Fee | $25 to $100 (varies by specific profession) |
| Business Lawyer Fees | $800 to $2,500 for custom operating agreements |
| Annual Report Fee | $100 due annually to maintain good standing |
How Long Does the Process Take?
Filing Form PLLC-1, New Hampshire, Secretary of State, Certificate of Formation - Professional Limited Liability Company with the Secretary of State typically takes 3 to 5 business days online or 1 to 2 weeks by mail. If your specific profession requires entity-level credentialing, practice permits, or board review through the Office of Professional Licensure and Certification, Concord, allow an additional 2 to 3 weeks to complete all professional compliance before opening to clients.
Frequently Asked Questions (FAQ)
Can an unlicensed person own a percentage of my PLLC?
Generally, no. Under New Hampshire law, all members of a PLLC must be licensed to perform the specific professional service for which the company was formed. You cannot have passive, unlicensed investors as owners.
Do we still need an Operating Agreement?
Yes. While not required to be filed publicly, an internal Operating Agreement is legally essential. It outlines how profits are split, how management decisions are made, and what happens if a member loses their professional license or passes away.
What happens if my professional license is suspended?
If a member's license is suspended or revoked, they legally must sever their ownership ties with the PLLC. The PLLC's Operating Agreement should include a mandatory buyout clause specifically for this scenario to prevent the dissolution of the entire business.
Can a PLLC provide more than one type of professional service?
Typically, a PLLC is restricted to a single profession. However, related professions (like doctors and registered nurses) may sometimes form a joint PLLC depending on the specific regulations of their respective licensing boards. A business attorney can clarify dual-service structures.
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