For many dentists, year-end is one of the most overlooked opportunities to influence their tax outcome. As practices expand, bring on new partners, add locations, invest in equipment, or adjust compensation models, their tax strategy must evolve alongside them. Each decision carries meaningful implications, affecting entity structure, depreciation schedules, retirement contributions, and family-employment planning.
Yet traditional firms handle tax strategy once per year, long after action can be taken, leaving major opportunities untapped: accelerating expenses, timing income efficiently, optimizing vehicle and home-office deductions, leveraging equipment depreciation, and planning retirement contributions before December 31. These strategies materially strengthen margins and long-term financial health, but only with proactive, year-round oversight.
Gelt, a tax firm built for healthcare professionals, replaces that reactive model. Combining top-tier tax professionals with proprietary AI, Gelt helps dentists uncover opportunities traditional firms miss. Instead of reacting to last year’s numbers, dentists gain a strategic partner—high-touch CPA advisors powered by advanced technology—so they can understand their tax position, identify opportunities, and keep more of what they earn.
The Critical Year-End Tax Decisions Dental Practices Can’t Afford to Miss
Year-end is the most important tax window for dental practices. It’s when dentists can still shape their tax position before deadlines—especially around entity structure, compensation, income timing, equipment placement, retirement contributions, and deductible expenses. Traditional firms often identify these opportunities too late. Key strategies include:
1. Evaluating Entity Structure Before It’s Too Late
Year-end is the ideal time to assess whether your current entity structure still fits the practice. Growing production, additional locations, real-estate ownership, or new partners may justify restructuring. From straightforward moves like an S-Corp election to more advanced configurations—such as a partnership with S-Corp overlay or MSO–PC structures—these decisions can reduce taxes moving forward.
2. Postponing or Accelerating Expenses and Income
Cash-basis dental practices can legally shift their tax position by timing revenue and expenses. Accelerating expenses—such as prepaying up to 12 months of rent, insurance, software, or clinical supplies—and delaying deposits or insurance reimbursements until January can significantly reduce taxable income. In other cases, accelerating income and delaying expenses may make sense, depending on projections for the upcoming year. These timing decisions are simple but highly impactful.
3. Optimizing S-Corp Salary Before December 31
S-Corp owners must finalize their salary before year-end. This is the last opportunity to adjust wages to ensure they are reasonable while optimizing QBI (Section 199A), retirement plan eligibility, and payroll taxes. A well-calibrated salary can create tens of thousands of dollars in savings.
4. Placing Equipment Into Service Before the Deadline
Dental practices often make significant technology investments. If new chairs, scanners, CBCT units, milling machines, or operatory upgrades are placed into service before December 31, dentists may qualify for Section 179 or bonus depreciation, allowing them to deduct most or all of the cost. Waiting until January could mean delaying those tax benefits for an entire year.
5. Maximizing Retirement Contributions
Dentists have access to some of the most powerful retirement structures available. Depending on practice setup, this may include 401(k) plans, Solo 401(k), SEP IRAs, employer profit-sharing, or cash-balance plans. Many of these require decisions and plan design work in Q4 to be implemented correctly. Done well, they can reduce taxable income by anywhere from $10,000 to several hundred thousand dollars.
6. Purchasing a New Business Vehicle
Year-end is the last chance to secure deductions for a new business vehicle. If you travel between locations, a vehicle over 6,000 lbs GVWR may qualify for a 100% first-year deduction if placed in service before year-end. Many dentists use strategies such as:
- Putting 10% down,
- Financing the remaining 90% at a competitive rate,
- Taking an immediate deduction (if eligible) on up to 100% of the vehicle’s value
- Deducting business-related interest
This can create a significant first-year tax benefit while preserving cash flow.
7. Hiring Family Members to Support Year-End Workloads
Year-end can be hectic. Hiring a spouse or children for legitimate work—administrative tasks, social media, inventory support—can reduce practice profits while shifting income into a lower bracket. With proper payroll and documentation, this is compliant and tax-efficient. Family members may also contribute income to a Roth IRA.
Choose a Tax Partner That Won’t Let You Procrastinate
Traditional accounting firms rarely surface these opportunities in time. They lack the visibility and technology to monitor financial patterns and alert dentists before deadlines.
Gelt closes this gap with a proactive strategy, continuous data review, and AI-driven insights that flag year-end opportunities in timing, depreciation, entity structure, and compensation. A dedicated tax lead helps dentists determine which strategies apply and implement them while the window is still open.
By pairing intelligent technology with experienced advisors, Gelt ensures dentists don’t miss meaningful year-end opportunities or leave money on the table.
