Maximizing profits and savings is always the goal for any business owner, including dental practitioners. Doing so can be a challenge though which is why it is important to explore effective tax strategies that may be used to reduce tax liabilities. Dental practitioners have to wear many hats and put in a lot of hard work to ensure their practice runs smoothly and their patients are happy. Dentist earn their money and keeping as much of it as possible is critical.
If you have questions about tax planning for dental practices or you are getting ready to open a dental practice with other shareholders then having legal counsel and representation on your side can ensure that everything is done properly and that you are best set up for success. The Los Angeles associate buy-in attorney at Leiva Law Firm can discuss your options and help you plan for your future growth and development.
Creating a Tax Plan for Your Dental Practice
Optimizing your financial situation by using key tax planning strategies that also ensure you comply with the laws and regulations is essential. With the right plan in place, you will be well informed and in the best position when it comes to making financial decisions. The following tips can provide insights on how to go about tax planning for dentists.
The business structure that you chose will affect your tax liabilities. For example, a sole proprietorship makes for a more straightforward and easy tax return as your income is put on your personal tax return. The downside is that your self-employment taxes could be on the higher side. By contrast, an S-Corporation uses shareholders for tax reporting which can save on taxes as a dentist’s self-employment tax liabilities will be lowered. Choosing the right business structure is critical for many reasons, including your taxes.
Once your business structure has been set up, and your practice starts taking patients, you must maintain accurate and organized financial records. This helps you more easily report your taxes as well as identify any opportunities for tax savings. You can do this by using accounting software or by working with a CPA who understands dental practice taxes. It is beneficial to schedule into your calendar regular and dedicated time to financial records management and updating.
Research where tax deductions can be found and leverage them where possible. As a dental practice, you will have business expenses like rent or payroll, for instance, that can be used for deductions. The equipment you purchase and maintain are also opportunities for tax savings and credits.
Dental professionals have to consider tax planning strategies that will support their practice and limit their liabilities. By doing so, it is possible to have your dental practice thrive and your future to be prosperous.
Speak to an Attorney at Leiva Law Firm Today
Understanding tax laws and regulations and implementing a plan that is designed to work for your dental practice can be tricky. An attorney can help. Call the Leiva Law Firm at (818) 519-4465 to schedule an initial consultation with an experienced attorney.
