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  2. According to the IRS, “ personal service ” includes any of the following fields: Accounting, actuarial science, architecture, consulting, engineering, health (including veterinary services), law, and the performing arts For a company to be a qualified personal service corporation, it must meet the requirements established by the IRS.
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    What is a qualified Personal Service Corporation?Definition & Examples A personal service corporation (PSC) is a type of C corporation (C-corp) where the owners provide service personally to people or groups. A qualified PSC is where employees providing substantially all the professional services own at least 95% of the stock.
    How do I know if a personal service corporation is qualified?The IRS uses 2 tests to determine if a personal service corporation is a qualified personal service corporation: Substantially all — more than 95% — of the activities of the corporation is to provide the services of the employee-owners in the qualified fields.
    What is a personal service corporation?Personal service corporations are not to be confused with professional corporations, which are business entities made up of certain types of professionals under state law. It's crucial to weigh the tax benefits against the administrative and compliance requirements of a personal service corporation.
    Who is considered an employee-owner of a personal service corporation?According to the IRS, a person may be considered an employee-owner of a personal service corporation if the following conditions are met: They are an employee of the corporation or perform personal services for, or on behalf of, the corporation (even if they are an independent contractor for other purposes) on any day of the testing period.
     
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