Illinois Medical Corporation Act Guide for Physicians
Learn who may own an Illinois medical corporation, how IDFPR registration works and what it costs, with slides and tables for physicians and practice owners.
Last reviewed October 29, 2026 · General information, not legal advice
General information only, not legal advice. CPA Tax Payroll and Accounting Corp is a CPA firm, not a law firm. Laws change: confirm with the official source or a licensed attorney before you act. Read the full notice.
The Illinois Medical Corporation Act, 805 ILCS 15, lets people licensed under the Medical Practice Act form a corporation to run a medical practice. The corporation is organized under the Business Corporation Act, and the Medical Corporation Act takes precedence where the two conflict. The Illinois Department of Financial and Professional Regulation (IDFPR) issues the certificate of registration; the Secretary of State only files the articles. This page is for physicians and practice managers weighing a medical corporation.
Slide show: The Medical Corporation Act in seven slides
What the law does
It lets licensed physicians practice through a corporation. The Business Corporation Act applies, and this Act wins if they conflict.
Who it covers
People licensed under the Medical Practice Act, which defines a physician as a person licensed to practice medicine in all its branches or a chiropractic physician.
The rule
Every shareholder, director and officer must be a licensee at all times. Stock goes only to licensed individuals, with no voting trusts or outside proxies.
The number
Articles cost $150 at the Secretary of State. IDFPR registration costs $50 per location, and renewal costs $40 (2026).
The deadline
Certificates expire on January 1 of every third year. The Act's cycle makes January 1, 2028 the next date.
The penalty
Operating without registration can bring late fees of $100 per year, up to $500, then a civil penalty up to $1,000 after a hearing.
A practical tip
Register every location and post the certificate at the premises.
Who is covered
Question
Answer
Section
Who may form one
One or more persons licensed under the Medical Practice Act; an Illinois attorney may sign as initial incorporator
2
Officers, directors, shareholders
All must be licensees at all times; no unlicensed person may have any part in ownership, management or control
13(a)
Stock
Only to licensed individuals; no voting trust or agreement giving another person the vote
13(b)
During dissolution
Unlicensed persons may hold roles only if no medical services are rendered or advertised
13(c)
Registration screen
Before it issues the certificate, IDFPR checks that every incorporator, officer, director and shareholder is licensed, none has discipline pending and the practice will follow the law
5
How it touches your taxes and payroll
A medical corporation is a Business Corporation Act corporation, so it is a C corporation by default: Form 1120, a flat 21% federal rate and, in Illinois, 7% income tax plus 2.5% replacement tax (2026). An S election is possible within IRS limits (individual shareholders, up to 100, one class of stock), with a 1.5% Illinois replacement tax; a licensee who is a nonresident alien would still block it. IDFPR may refuse to renew or may suspend the certificate if the corporation does not file Illinois tax returns or pay tax shown on a return or a final assessment. See S corporation taxes, C corporation taxes and our page for physicians and healthcare professionals.
