Professional corporations in some states do not provide limited liability with respect to the professional malpractice of other shareholders.

Question

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In some states, professional corporations (PCs) do not provide limited liability protection for malpractice committed by other shareholders. This means that if one shareholder commits malpractice, the other shareholders may be held personally liable for damages. It is important for professionals to understand the laws in their state regarding the liability protections afforded by forming a PC.

Professional Corporations in Some States Do Not Provide Limited Liability