The 179 Tax Deduction for dentists and Compassionate Finance

As more patients can afford dental treatment with Compassionate Finance, how will you use that income? And how can that investment better your practice?

THE PROBLEM WITH MORE MONEY…

The math is easy: Offer affordable dental financing and your revenue will go up. The only downside is the tax you need to pay on that revenue. For small and medium-sized businesses, a million dollars in tax savings helps take away the sting.

In 2017, the A.D.A. lobbied successfully to insure that dental practitioners could receive the maximum benefits that Section 179 of the tax code allowed. This means that if you own a dental practice and file a U.S. Business Income Tax Return for the year 2018, you are eligible to take advantage of this million-dollar deduction. And you should.

THE BASICS

Simply put, you can buy or lease equipment for your practice up to a combined value of 2.5 million dollars and you will be able to deduct up to one million dollars from your tax bill. The deduction covers both new and used purchases, including software. It can even be used to deduct your car. Remember, for this deduction apply, the items had to have been bought and in service before Dec. 31, 2018.

Of course, you need to sit down with an accountant. For example, this Section 179 deduction works along with Bonus Depreciation. Combining the two can bring your net income down to zero, but Bonus Depreciation can also help create a tax loss. 179 can only bring it to zero. Be sure you have your accountant show you the result of combining these two tax options. In any case, save and be prepared to show receipts, bills of lading and other documentations to support your tax claims.

NEW YEAR, NEW DEDUCTIONS

As 2018 dwindles in the rearview mirror, dental practitioners should start thinking ahead. Any business purchase you make before midnight on December 31, 2019 can be used to get the Section 179 deduction. So what should you invest in?

As a professional that delivers compassionate care to dental patients, you are probably aware that one of the main trends in dentistry is to provide services with as little pain or discomfort as possible. To that end, you should look at providing your patients wi-fi in the waiting room, offering audiobooks and headphones to distract them in the chair and keeping iPads on hand to let your patients apply for or check the status of their COMPASSIONATE FINANCE account when discussing treatment options.

Anything you can do to make dental treatment comfortable and convenient will up your practice’s rating. Of course, with up to $1,000,000 in deductions available, you should think big. The more services you provide, the more likely patients will choose and stay with you and the more affordable dental care you can deliver. Need some ideas?

• A top-quality 3D dental printer can cost a dental practice $100,000. That can also allow you to use that machine to drive revenue, as well as reduce your taxes when you do yours for 2019.
• Look at digital impression technology. Spending from $21,000 to $24,000 for the equipment and training lets you create more accurate restorations more quickly. As many insurance companies do not provide coverage for technology that is becoming more and more common, your Compassionate Financing affiliation will allow you to offer this service to all of your patients. Remember, even patients with dental insurance should be made aware of the benefits of using COMPASSIONATE FINANCE’s flexible payment options to supplement their coverage.
• Upgrade your laser technology. Lasers are used in most aspects in dental service, from aiding in surgery to helping whiten teeth. As the available and approved treatments increase, so should your laser technology. As laser hardware can be a six-digit purchase, you have Section 179 to make this an investment in your future.

SMILING AT TAX SEASON

Be proactive in preparing for your 2019 tax season. Use easy, affordable dental payment plans from Compassionate Finance to increase your revenue. The added treatments and interest revenue will also increase your gross income. Luckily, you can afford to invest in your practice when you keep Section 179 in mind. Talk to your accountant and start thinking about next year’s tax season. You might find yourself smiling.

Talk to us today about what Compassionate Finance can do for you and your patients. CALL 866.964.4727

SOURCES:

https://www.ada.org/en/publications/ada-news/2019-archive/january/taxes-and-179-expensing

https://www.section179.org/section_179_deduction/

https://www.dmdtoday.com/news/how-the-section-179-tax-deduction-will-benefit-your-practice

https://www.yourdentistryguide.com/digital-impressions/

https://www.webmd.com/oral-health/guide/laser-use-dentistry