§22.2 - What Constitutes a "Profession"?

• Jurisdiction: Washington

§22.2 WHAT CONSTITUTES A "PROFESSION"?

Before we can determine whether the statutes applicable to professional entities apply, we must first determine what constitutes a "profession" under the applicable law. Unfortunately, in the state of Washington it is not always clear whether individuals involved in a particular endeavor qualify as "professionals." Neither the legislature nor the courts have produced an all-inclusive list of those endeavors that qualify as professions and those that do not. Accordingly, our discussion of professional partnerships (whether general or limited liability) and PLLCs must necessarily be limited by the inherent impreciseness of the definition of profession.

Tax Comment: For purposes of federal income tax law there is no difference between the taxation of the partners of a partnership of professionals and the partners of a partnership composed of nonprofessionals (whether the partnership be a general partnership, an LLP, or an LLC classified as a partnership). The same is true of PLLCs, as long as the PLLC elects tax classification (either directly or through the default provisions of Treas. Reg. §301.7701-3) as a partnership. A PLLC may elect tax classification as a corporation or as an "S corporation." If a PLLC elects corporate classification, then the corporate tax rate of 21 percent applies.

(1) Statutory definitions of "profession"

Unfortunately, nowhere in the statutes pertaining to PLLCs (or elsewhere) does the RCW provide an exhaustive list of professions that qualify an individual or group of individuals as "professionals" for purposes of the Washington Limited Liability Company Act (LLC Act), Chapter 25.15 RCW.

Nowhere in Chapter 25.15 RCW does it provide a clear definition of the "professions" covered by this Act. RCW 25.15.006(15) merely defines "professional service" as meaning "the same as defined under RCW 18.100.030."

RCW 18.100.030(1) pertaining to businesses and professions defines "professional service" as including:

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any type of personal service to the public which requires as a condition precedent to the rendering of such service the obtaining of a license or other legal authorization and which prior to the passage of this chapter and by reason of law could not be performed by a corporation, including, but not by way of limitation, certified public accountants, chiropractors, dentists, osteopaths, physicians, podiatric physicians and surgeons, chiropodists, architects, veterinarians and attorneys-at-law.

Obviously, the phrase in the statute "and which prior to the passage of this chapter and by reason of law could not be performed by a corporation" is the key to an understanding of what professions are included in the statutory definition of "professional service." Title 18 RCW (which pertains to businesses and professions) simply lists the regulated occupations as "businesses and professions." Nowhere in Title 18 RCW or elsewhere do the statutes designate which regulated occupations qualify as "professions" for purposes of applying the LLC Act.

Without attempting to resolve the issue, the following is a list of occupations that are contained in Title 18 RCW and at least arguably might now or in the future qualify as professions in the state of Washington, together with the chapter of the RCW that regulates each occupation:

Accountants	Ch. 18.04 RCW
Acupuncturists	Ch. 18.06 RCW
Architects	Ch. 18.08 RCW
Attorneys-at-Law	Ch. 2.48 RCW
Certified Real Estate Appraisers	Ch. 18.140 RCW
Chemical Dependency Professionals	Ch. 18.205 RCW
Chiropractors	Ch. 18.25 RCW
Counselors	Ch. 18.19 RCW
Court Reporters	Ch. 18.145 RCW
Dental Hygienists	Ch. 18.29 RCW
Dental Professionals	Ch. 18.260 RCW
Dentists	Ch. 18.32 RCW
Denturists	Ch. 18.30 RCW
Dietitians and Nutritionists	Ch. 18.138 RCW
Dispensing Opticians	Ch. 18.34 RCW
Drugless Healers	Ch. 18.36 RCW
Embalmers	Ch. 18.39 RCW
Engineers	Ch. 18.43 RCW
Escrow Agents	Ch. 18.44 RCW
Funeral Directors	Ch. 18.39 RCW

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Genetic Counselors	Ch. 18.290 RCW
Hearing and Speech Services	Ch. 18.35 RCW
Land Surveyors	Ch. 18.43 RCW
Landscape Architects	Ch. 18.96 RCW
Marriage and Family Therapists	Ch. 18.225 RCW
Massage Therapists	Ch. 18.108 RCW

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