Year End Tax Strategies for Dentists

As we move into the last Quarter of the year, this is a great time to review your tax strategy with your dental CPA. You should make sure your Dental Independent Contractor Business or your Dental Practice is taking advantage of the tax deductions available. Below are some year end tax strategies for dentists to consider.

Dentists working as Independent Contractors

• If you haven’t done so already be sure to consider if a S Corp strategy can save you thousands in taxes.
• If you already have a S Corporation, consider adopting an Accountable Plan that can help deduct business use of Cell Phone, Mileage driven to and from the practice and Home Office
• If you pay for Health or Disability Insurance, check with your adviser on how this can be reported on the company payroll tax returns to achieve a much higher tax deduction.
• Be sure to keep track of business related expenses such as CE Courses, Mal Practice Insurance, License Fees and Supplies or Equipment you may have purchased.
• Consider setting up a 401k or SEP for your S Corp and the optimal amount. This should be discussed with your advisor to ensure the that in trying to save taxes you don’t end up over paying in SS or Medicare
• Calculate and see if you are able to take advantage of the new TCJA business deduction.

Dental Practice Owners

• Consider timing of equipment purchases and whether Section 179 or full Depreciation.
• Consider Reasonable Salary consideration
• Is a Turbo Charged Retirement Plan the best option for you?
• Does an Income Splitting strategy work for your situation?
• How can you tie in an Accountable Plan to your strategy?
• Can you prepay Vendor invoices
• Calculate and see if you are able to take advantage of the new TCJA business deduction.
• Optimize Vehicle Deduction using the Accountable Plan

This year proves to be the most interesting with the current tax changes. If you are a Virjee Consulting client we will already be reviewing the strategies listed above in addition to other moves. If you not a Virjee Consulting client, feel free to reach out to us to see if we can help provide you the tax and business consulting needed to maximize your tax savings and cash flow for your Dental business.

Here’s to your best financial future ever!

Written by Omar Virjee, CPA. For more information on our services, please feel free to contact one of our Dental CPA team members by calling 713-396-3172 or emailing omar@virjeeconsulting.com

Disclaimer- Advise in this blog should not be taken as tax advise. Each person’s tax circumstance is different and unique. Using these strategies without full knowledge of the current IRS rules and regulations regarding the specific items discussed can result in heavy fines, penalties and interest. Please discuss the guidance in this document with a tax expert before making any decisions.