Should My Dental Practice Be Incorporated?
Many factors go into determining whether or not you should operate your dental practice as a corporation. If the right factors are present, it could be a very wise decision for you to incorporate. Most dentists tell me “it’s no longer advantageous to be incorporated.” They feel this way mainly because of three changes that occurred back in the 1980’s:
These changes make incorporating no longer as beneficial as it used to be. However, it still may be very beneficial for you to be a corporation and many factors need to be considered.
These last two factors cannot be quantified in terms of dollar amounts. However, the potential benefits from either one of these could easily greatly outweigh the costs of incorporating your practice. As always, I recommend you seek competent professional assistance to help you make the proper decision given your particular set of circumstances.
Reduced IRS Audit Risk
IRS audits can be extremely expensive and stressful, even if the final end result is no increase in taxes. Several years ago I represented (and successfully defended) about 30 dentists across the nation that were being audited by the IRS for claiming a tax credit (better than a deduction) for their intra-oral camera purchases. Guess what - none of the dentists being audited were incorporated!
Other Corporate Fringe Benefits
Payroll Tax Savings
In analyzing whether to be a dental corporation today, many factors must be addressed - and as always be sure to seek competent professional help.
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