Q&A: Deciding whether to incorporate

Q: I am a solo physician in private practice. Should I incorporate?

A: The primary reason to incorporate is to reduce the potential for lawsuits or other claims against your personal assets. If you choose to incorporate, you can only use a professional corporation and not a regular corporation. The difference between the two is that, unlike a regular corporation, a professional corporation won't insulate you from your own-or your employees'-malpractice or other negligent acts. Still, a professional corporation may offer some protection to you or your assets from other types of liability-e.g., an accident in the office, sexual harassment, wrongful termination, etc. The biggest advantage to not incorporating is that you'll save time and money on paperwork; if you don't incorporate, you'll only need to file a personal income tax return, as opposed to personal and business returns.