How To Start A Mental Health Practice In Florida

1. Local Zoning Laws and Regulations in Florida

• It is crucial to check the local zoning regulations before choosing a location for your therapy practice, even if it’s your own home, as Florida comprises 67 counties and 411 municipalities.
• If your desired business location is not typically allowed in a specific area, such as a home business in a residential zone, you may apply for a zoning variance, which is essentially an exception to zoning laws.
• To determine whether you need to apply for a variance, the types of zoning recognized in your town or city, and the kind of business activities allowed, you can contact your local municipality for further guidance.
• Here is Florida state government post the regulation explanation and case examples about state property and zoning ordinances: https://www.myfloridalegal.com/ag-opinions/state-property-and-zoning-ordinances

2. Business Name Search in Florida

• If you run a therapy practice as a sole proprietorship or general partnership and plan to conduct business beyond your own or your partners’, you are mandated by law to register a fictitious business name in Florida.Here will be the detail steps

1. Check Florida’s fictitious name records to ensure that the name you want to register is available. You can also check Fictious Name Registration Instructions looking for naming guidelines and other information.
2. Advertise your fictitious name at least once in a newspaper published in the county where your practice operates. You don’t need to provide proof that you’ve published the name, but when you register it, you will personally certify that the name has been advertised.
3. Sign in to FL Fictitious Name Registration and follow the prompts on screen.
4. Pay the $50 fee.

3. Business Structure in Florida

• The type of business structure you choose for your practice affects how your income is taxed and who may own shares in the practice. Each state has different business structures available for registration.
• *Only individuals working in regulated professions, which includes mental healthcare workers, are allowed to become members or shareholders.
• Sole Proprietorship
  • By default, when starting a business on your own, you are classified as a sole proprietor. This type of business structure is the most basic, as there is no legal or financial protection offered. Your business is not considered separate from yourself, meaning that any revenue or losses are directly tied to you personally.
• General Partnership
  • In a general partnership, all partners are considered general partners, meaning that they share legal and financial liability equally.
• Business Corporation
  • A profit corporation is a kind of corporation that is separate from its owners, who own shares in it. It can be one of two types: C corporation or S corporation. C corporations have their income taxed separately from the income of the shareholders, while S corporations pass on the tax liability to each shareholder. If a C corporation wants to become an S corporation, it can do so by filing IRS Form 2553. we recommends its clients form S corporations at the federal level for various reasons.
  • In Florida, individuals practicing certain professions are required to establish professional service corporations. A professional service corporation operates similarly to a business corporation but offers greater protections for shareholders in the event of a malpractice suit. To form a professional service corporation, all shareholders must be licensed and practicing the same profession.
• Limited Liability Company (LLC)
  • The LLC business structure provides limited liability protection like a corporation, but allows for flexibility in how it is taxed. Your accountant may suggest electing to be taxed as an S corporation or partnership depending on your circumstances.
• Professional Limited Liability Company (PLLC)
  • The PLLC business structure is similar to the LLC, but every member must be licensed by the state and provide certification when filing articles of formation with the Department of State. Therapists meet the requirements for licensed professionals. This structure offers additional legal protection for all members in the event of litigation brought against the organization, such as a malpractice suit from a patient.
• Limited Partnership (LP)
  • A limited partnership provides liability protection only for some of its members. To function as a limited partnership, there must be at least one general partner who is responsible for managing the partnership and making significant decisions, as well as at least one limited partner who is not involved in management and has limited liability. General partners have unlimited liability and are personally responsible for partnership debts, legal actions, and other obligations. Limited partners, on the other hand, are only responsible for their respective share of the partnership.
• Limited Liability Partnership (LLP)
  • An LLP, or Limited Liability Partnership, is a type of partnership that provides additional protection to its partners. It is frequently used by professionals such as lawyers, accountants, and therapists. The LLP structure safeguards each partner against the consequences of other partners’ professional misconduct. If one partner is sued by a client, the other partners are not held liable. In essence, it is the professional equivalent of a general partnership.
• Limited Liability Limited Partnership (LLLP)
  • The LLLP business structure is almost identical to the LLP business structure. The key difference is that a general partnership can opt to register as an LLP, while a limited partnership can choose to register as LLLPs.

4. Register Your Business in Florida

• People should do two things
  1) File the business registration with the Florida State
  2) Paying the filing fee
• Sole Proprietorship
  • Filing Fees: No cost to form, fee apply to register an assumed name
  • There are no extra steps you need.
• General Partnership
  • Filing Fees: No cost to form, optional registration payment is $50.
  • You only need to register an assumed name. Consider creating a partnership agreement to easily settle any future disputes. If you plan to form an LLP later, you can choose to register your general partnership with the Department of State.
• Incorporate (Profit Corporation or Professional Corporation)
  • Filing Fees: Articles of Incorporation: $35 + design a registered agent: $35.
  • First, choose a business name.
  • Second, appoint a registered agent, who is over 18 years old and has an address within the state. The registered agent is responsible for receiving all official communications from the state.
  • Last, file your Article of Incorporation and pay the fee using the profit corporation page.
  • After you have incorporated, you can elect S corporation status by filing the IRS Form 2553.
• Limited Liability Company (LLC)
  • Filing Fees: Articles of Organization: $100 + registered agent designation: $25.
  • First, choose a business name.
  • Second, appoint a registered agent, who is over 18 years old and has an address within the state. The registered agent is responsible for receiving all official communications from the state.
  • Last, file your Article of Organization and pay the fee using the LLC page.
• Professional Limited Liability Company (PLLC)
  • Filing Fees: Articles of Organization: $100 + registered agent designation: $25.
  • First, choose a business name
  • Second, appoint a registered agent, who is over 18 years old and has an address within the state. The registered agent is responsible for receiving all official communications from the state
  • Last, file your Article of Organization and pay the fee using the LLC page.
• Limited Partnership (LP)
  • Filing Fees: file a Certification of Limited Partnership: $965 + designate a registered agent: $35.
  • First, choose a business name.
  • Second, appoint a registered agent, who is over 18 years old and has an address within the state. The registered agent is responsible for receiving all official communications from the state.
  • Last, file a Certificate of Partnership and pay the fee using the limited partnerships page.
  • To stay organized and resolve any disputes between partners, it is recommended that you draft a partnership agreement, although this is not mandatory by law in the State of Florida.
• Limited Liability Partnership (LLP)
  • Filing Fees: File a Statement of Qualification: $25.
  • To register a Limited Liability Partnership (LLP) in Florida, you need to follow the same process as registering a Limited Partnership (LP). You can find more information about this on the Department of State’s partnership page. However, unlike registering an LP, you need to have an already existing and registered general partnership to register an LLP.
  • First, choose a business name.
  • Second, file a Statement of Qualification for Florida LLP and pay the fee on the limited partnerships page.
• Limited Liability Limited Partnership (LLLP)
  • Filing Fees: File a Certificate of Limited Liability Limited Partnership: $965 + designate a registered agent: $35.
  • First, choose a business name
  • Second, appoint a registered agent, who is over 18 years old and has an address within the state. The registered agent is responsible for receiving all official communications from the state.
  • Last, file a Certificate of Partnership and pay the fee using the limited partnerships page.
  • To stay organized and resolve any disputes between partners, it is recommended that you draft a partnership agreement, although this is not mandatory by law in the State of Florida.

5. Business Licenses & Permits in Florida

• To operate a therapy practice in Florida, you might need to obtain licenses or permits at the federal, state, and local levels.
• However, there are no special federal permits or licenses required to operate in Florida, and there are no permits or licenses required at the state level, except for the standard licensure for mental health practitioners.
• At the local level, such as your town or city, you might need to purchase a business license in order to operate. Please contact your local permitting office for more information.

6. Business Insurance in Florida

If you run a therapy practice in Florida, it is strongly advised that you obtain certain types of business insurance.

• • General Liability Insurance
    • Liability insurance provides protection in case you cause damage to someone else’s property or person. In Florida, there is no limit on the amount of money that can be awarded in a liability lawsuit, so it’s important to ensure that you have sufficient coverage. It’s recommended to have at least $1 million in coverage.
  • Commercial Property Insurance
    • This type of insurance covers items such as computers, business phones, and office furniture that your practice owns, as well as the building itself whether it is owned or rented.
  • Business Income Insurance
    • This type of insurance provides coverage for loss of income that may occur in specific situations, including natural disasters such as fire or storm damage, as well as man-made disasters such as theft.
  • Professional Liability Insurance
    • This type of insurance provides protection in case you face a lawsuit due to claims of libel or slander, improper handling of patient records, provision of inaccurate advice, or any other form of harm caused while performing your professional duties
  • Florida Worker’s Compensation Insurance
    • If you have employees working for you, it is legally mandatory in Florida to provide them with worker’s compensation insurance. This type of insurance can cover medical expenses, lost wages, and ongoing care if one of your employees is injured on the job
• Consider purchasing a business owner’s policy (BOP) while shopping for insurance. BOPs commonly offer three essential types of insurance coverage: general liability, commercial property, and business income.

7.  Business Taxes in Florida

• In Florida, C corporations are the only ones required to pay income tax, which is set at a rate of 5.5%. To avoid paying income tax in the state, many business owners choose to file IRS Form 2553 to elect S corporation status. S corporations provide many of the protections of a C corporation, without the added tax burden. It is recommended that you consult with an accountant or qualified tax professional if you are considering incorporating in Florida.
• How to Pay Taxes in Multiple States
  • If you are moving to Florida from another state where you had previously started your therapy practice, or if you’re moving to a different state from Florida where you currently operate, you may need to determine the process for paying taxes in multiple states.
  • The tax rules that apply to therapists can change depending on which states they work in and how much time they spend in each state. For more information, check how moving to a different state can affect your taxes.