Who we work with
We work with owners of medical and dental practices bringing in $1 million or more in annual revenue: family and specialty medicine, general and specialty dentistry, orthodontics, and other independent practices, from solo owners to groups with several partners or locations.
Practice owners at this level are usually in the highest tax brackets. Many of the usual deductions phase out, and the decisions that matter most, like how you pay yourself, when you buy equipment, whether you own your building, and how you save for retirement, need to be planned before the year ends.
The tax and financial challenges practice owners face
Independent medical and dental practices carry the costs of a business and the income of a high earner. Both need a plan.
High income, fewer deductions
Health care is a specified service field for the 20% QBI deduction, so it can shrink or disappear at higher incomes. Other breaks phase out too, which makes planning ahead more valuable.
Owner compensation
How you split income between salary and distributions, and how partners are paid in a group practice, affects payroll tax, retirement contributions, and your personal tax bill.
Equipment and technology
Dental chairs, imaging and CBCT systems, lab equipment, and practice software are major purchases. Timing and depreciation choices can change your tax bill in the year you buy.
Large teams and benefits
Hygienists, assistants, nurses, medical assistants, and front office staff make payroll one of your biggest costs. Benefits and retirement plans for your team need to fit your own planning too.
The building and multiple locations
Many owners buy the building their practice uses or open more offices. A separate real estate entity and the right structure for each location can protect assets and open up planning options.
Buy-ins, buyouts, and transitions
Bringing on a partner, buying an existing practice, or selling to a group raises questions about price allocation, goodwill, and timing that affect taxes on both sides.
Strategies that often fit medical and dental practices
Every practice is different, and we only recommend what fits your numbers and your goals. These are strategies that often come up for practice owners.
- A cash balance plan on top of your 401(k)High-earning owners 45 and up may be able to deduct far more for retirement than a 401(k) alone allows, though staff contributions are part of the cost to plan for.
- S corp reasonable compensationPhysicians and dentists who own an S corp need a salary that reflects their work and holds up to IRS scrutiny, with the rest of the profit coming out as distributions.
- Own the building, rent it to yourselfHolding your office in its own LLC can protect it from practice liability and give you a separate asset when you sell or transition the practice.
- Section 179 and 100% bonus depreciationChairs, imaging systems, and other equipment can often be deducted in the year they’re placed in service.
- The Oklahoma PTE electionOklahoma owners with S corps or partnerships may be able to turn state income tax into a federal business deduction.
- The 20% QBI deductionBecause health care is a specified service field, keeping taxable income under the phase-out can help you keep some or all of this deduction.
- The backdoor Roth IRAHigh earners who are over the Roth income limits can often still build tax-free retirement savings through the back door.
Advanced strategies for higher-income owners
Practice owners with higher incomes, larger estates, or a sale on the horizon often need more than the basics.
- The mega backdoor RothIf your practice 401(k) allows after-tax contributions and in-plan conversions, you can move much more into Roth savings each year.
- Selling to a DSO, hospital, or groupHow the price is split between goodwill, equipment, and a non-compete can change the tax on the same sale a great deal.
- Avoiding the 3.8% net investment income taxRent your practice pays to your own building LLC can stay out of the 3.8% tax when the rules are met.
- Lifetime gifts and SLATsWith the federal estate tax exemption at $15 million per person, owners with growing estates can move future growth out of their estate.
- 529 superfundingPut five years of gifts into a 529 at once to fund college for children or grandchildren.
- Donor-advised fund bunchingGroup several years of giving into one year so your charitable gifts still lower your taxes under the 2026 rules.
Everything under one roof
One monthly Tax Plan covers your practice and your personal taxes. Plans start at $475 per month and are priced by complexity, and you’ll know your price before you commit.
- Year-round tax planningWe project your tax bill all year and plan equipment, hiring, partner changes, and retirement contributions before deadlines pass.
- Business and personal returnsYour practice return and your personal return, included in your plan.
- BookkeepingMonthly books that track collections, expenses, and each location, so your plan runs on real numbers.
- Payroll for your whole teamProviders, clinical staff, and front office staff, with payroll tax filings handled.
- Sales taxTracking and filing for any taxable products you sell, such as retail dental or skin care items.
- 1099sPrepared and filed for contract providers and vendors who need them.
- Quarterly estimated paymentsFederal and state amounts calculated for you, with personal and business taxes shown separately.
- IRS audit protection and representationIf a notice or audit comes, we represent you before the IRS and handle it with you.
- CFO-style reportingClear reports on profit, cash, overhead, and how each provider and location is performing.
- Direct access to your advisorCall before you decide, not after.
An illustrative example: a cash balance plan for a dental practice
Picture a dentist, age 52, who owns a dental practice taxed as an S corp, with $2.4 million in revenue and about $700,000 of profit. The owner already makes the maximum 401(k) contribution and adds a cash balance plan on top.
For illustration purposes. Tax law may change, which may change these calculations slightly.
| Without the plan | With the plan | |
|---|---|---|
| Owner’s cash balance plan contribution | $0 | $150,000 |
| Required contributions for eligible staff (assumed) | $0 | $18,000 |
| Total deductible contributions | $0 | $168,000 |
| Federal income tax saved by the owner (37% bracket) | $0 | about $62,160 |
The owner’s federal income tax drops by about $62,160 ($168,000 × 37%), while $150,000 goes into the owner’s own retirement account. Oklahoma tax is figured separately: if the practice makes the Oklahoma PTE election, the deduction lowers the practice’s PTE tax (a business tax) by about $7,980 (4.75%). Without the election, it lowers the owner’s Oklahoma personal income tax by about $7,560 (4.5%).
The $18,000 for staff is a real cost, and a cash balance plan is a commitment to contribute for several years, not a one-time deduction. An actuary sets the actual contribution amounts each year, and the money is taxed when you take it out in retirement.
Illustrative example. The dentist, practice, and figures above are hypothetical, used to explain how the strategy works. They are not a client and not a promise of results. The $150,000 and $18,000 contributions are assumed, not an actuarial calculation. The example assumes the owner is above the QBI phase-out range, so the QBI deduction doesn’t change, and that the full deduction is used in the 37% bracket. This page is educational and is not tax advice for your situation.
Questions practice owners ask us
Why don’t I get the full 20% QBI deduction?
Health care is a specified service trade or business under the QBI rules. Above certain income levels, the deduction phases out for those businesses. Planning around retirement contributions and other deductions can sometimes keep more of it, and we look at that in your free tax analysis.
Is a cash balance plan right for my practice?
It can be a strong fit for profitable owners who want to save more for retirement than a 401(k) allows, especially owners 45 and up. Because these plans also require contributions for eligible staff, we look at the full cost against your tax savings before recommending one.
Should I own the building my practice is in?
Owning your building can build wealth and give you planning options, but it’s a big decision. Holding it in a separate LLC and leasing it to the practice is a common structure. We’ll walk through the numbers and the tax impact with you.
Do you work with practices outside Oklahoma?
Yes. We’re based in Norman and fully virtual, and we work with practice owners in Oklahoma and beyond.
Should my practice be a C corporation now that the corporate rate is 21%?
Sometimes, but not usually. A C corporation pays a flat 21% federal rate, but profits paid out as dividends are taxed a second time, and health care businesses don’t qualify for the Section 1202 exclusion when the stock is sold. For most practices that pay out their profit each year, an S corp or partnership still works better. We run both sides with your numbers before recommending a change.
How is the sale of my practice to a DSO or group taxed?
It depends on whether you sell assets or stock and how the price is allocated. Goodwill is usually taxed at capital gain rates, while payments for a non-compete or consulting are ordinary income, and equipment can bring depreciation recapture. Equity you roll into the buyer can sometimes be deferred. We plan the allocation with you before you sign a letter of intent.
Can I deduct the cost of buying another practice?
Yes, but mostly over time. Goodwill and other intangibles from a purchase are generally deducted over 15 years, while equipment you buy can often be written off much faster. How the purchase price is allocated decides how quickly you get the deductions, so we look at it before you close.
Watch the story
A one-minute story about this strategy. Illustrative story; the people are fictional and are not clients. See all story videos.
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