How to set up a contractor company as a self-employed therapist
Going 1099 gives you control over your schedule, your caseload, and your income — but it also makes you a small business. Here's the practical setup most PTs and OTs in Florida follow to do it cleanly and protect themselves.
8 min read
When you contract with a staffing pool like PBPT, you're paid as an independent contractor rather than an employee. That means the income is yours to manage — and so are the taxes, insurance, and legal structure. The good news: setting up properly takes a weekend, not a law degree. Here's the path most therapists take.
1. Choose a business structure
Most independent therapists operate as either a sole proprietor or a single-member LLC. You can take visits as a sole proprietor under your own name, but an LLC is the more common choice for a reason.
Sole proprietor
The default if you do nothing. Simple and free, but your personal assets and your business are legally the same thing — there's no liability separation.
Single-member LLC
A Limited Liability Company creates a legal wall between your business and your personal assets. In Florida you register with the Division of Corporations (Sunbiz) and pay a one-time formation fee plus an annual report fee. For most contracting therapists, this is the sweet spot: real liability protection without corporate complexity.
What about an S-Corp?
2. Register and get your EIN
- Form the LLCwith your state (in Florida, via Sunbiz). Pick a name that isn't already taken and list a registered agent.
- Get an EIN (Employer Identification Number) free from the IRS website in about ten minutes. Use it instead of your Social Security number on W-9s and contracts.
- Open a business bank accountin the company's name. Never mix personal and business money — commingling is the fastest way to undermine your liability protection.
3. Cover yourself with insurance
Treating patients in the home carries real risk, and most agencies and pools require proof of coverage before you take a single visit.
- Professional liability (malpractice) — the core policy for any practicing therapist. Verify the limits your pool requires.
- General liability— covers non-clinical incidents (think a slip-and-fall in a patient's home).
- Auto— confirm your personal policy covers business use, since you'll be driving between visits all day.
4. Get your contracts and paperwork in order
- A signed independent contractor agreement with each pool or agency, spelling out rates, scope, and expectations.
- A current W-9 on file so you receive a 1099-NEC at year end.
- Your active Florida license, current CPR, and any required competencies — keep digital copies handy for credentialing.
5. Plan for taxes from day one
As a contractor, no one withholds taxes for you. You're responsible for both income tax and self-employment tax (Social Security and Medicare), and the IRS expects you to pay as you go.
- Set aside roughly 25–30% of every payment in a separate account for taxes. Adjust with your CPA based on your bracket.
- Pay quarterly estimated taxes (April, June, September, January) to avoid underpayment penalties.
- Track deductible expenses — mileage, license and CEU costs, malpractice premiums, phone, supplies, and a home office can all lower your taxable income.
6. Keep clean books
You don't need enterprise software. A simple accounting app (QuickBooks Self-Employed, Wave, or even a disciplined spreadsheet) plus a dedicated business account and card covers most independent therapists. Reconcile monthly so tax season is a non-event, and save digital copies of every receipt and 1099.
You don't have to figure this out alone