Tax Planning for Dentists

A dental practice is taxed on three things at once: chairside production, the equipment behind it, and the entity that holds it. A preparer who treats it like a personal return manages only the production. We plan the equipment timing, the S-corp salary, and the retirement plan a practice can run — the three levers that actually move the tax owed.

Request a dentist tax review

Practice-owner CPA advisory

Equipment, entity, retirement — modeled together

The Short Version

Tax planning for dentists works on three things a practice owner controls: how equipment is written off, how the practice is taxed, and how much income gets sheltered in retirement plans.
Equipment placed in service after January 19, 2025 can be deducted in full the first year, so a new chair, scanner, or cone-beam unit can offset a large share of practice income.
The biggest recurring overpayment comes from structure — an owner taxed the wrong way overpays year after year, and the fix has to be set before the year starts.

Depreciation on the chairs and scanner, the salary an S-corp allows, and the retirement plan a practice can run each reduce the tax you owe — but only if someone sets them up before year-end. Equipment gives the fastest deduction: a chair, scanner, or cone-beam unit placed in service this year can be written off in full instead of spread across seven, thanks to 100% bonus depreciation being made permanent by the One Big Beautiful Bill Act.

The salary an S-corp lets you draw and the retirement plan a practice can run each carry their own deadlines. Miss them and the year closes with the deduction gone.

What Dentist Tax Planning Covers

Four parts of a practice that affect the tax you owe — every one has a deadline:

Equipment and Buildout Depreciation

Timed and expensed for the year they help most. Chair, scanner, cone-beam, imaging, ops buildout — 100% bonus depreciation makes them deductible the year they go into service, not over seven.

Entity Structure

Sole proprietorship, S-corp, or PLLC taxed as an S-corp, and the salary the S-corp requires. An owner taxed as a sole prop pays 15.3% self-employment tax on all net profit. An S-corp splits that into salary + distributions.

Retirement Plans for the Practice

Solo 401(k), profit sharing, and cash balance plans that move large sums out of taxable income. The 2026 defined contribution ceiling is $72,000 per owner — most single-plan setups never come close.

Owner Pay and Distributions

Set so the reasonable-compensation rule holds. See S-corp reasonable compensation for the framework. Salary too low = IRS challenge. Too high = SE tax overpaid.

How Tax Planning for Dentists Works

Read the practice

We look at the P&L, your equipment, your entity, and your retirement setup, and find where you are overpaying. A general preparer sees the year after it happened — by then the timing is fixed.

Build the plan

We model the entity, the depreciation timing, and the retirement contributions together, since one changes the others. See convert LLC to S corp if the election is the lever, or LLC taxed as S corp for the framework.

Run it through the year

We set the salary, quarterly estimates, and retirement contributions, then adjust as profit comes in. See safe harbor estimated taxes to avoid underpayment penalties.

Why Practice Owners Trust Dimov Tax

We hold your practice books and your personal return together, so the plan covers both at once. A general preparer files what you hand in — a planner sets the equipment timing, the S-corp salary, and the retirement plan before year-end, when they can still move the number.

$1.5B+

in tax savings identified for clients

63%

of clients return year after year

70+

tax and financial services under one roof

15+ yrs

of senior experience per engagement

What Dentist Tax Planning Costs

We price by the work involved. A single-location practice cleaning up its entity and depreciation for one year costs less than a multi-site group that wants the salary, estimates, and retirement plan run and adjusted every quarter.

We size the job after reading the books and the current return, then quote a number before any work starts. Send last year's return and a rough P&L — the review shows what you can still change this tax year, with a number on each. If the math doesn't justify the work, we'll tell you.

Get a quote for practice planning. The quote comes after we read the numbers, not from a menu.

Signs Your Practice Is Overpaying

Six signs a dental practice is leaving money on the table year after year — each with a deadline that closes as the calendar year does:

Sole prop or SMLLC

Practice nets six figures on a Schedule C. The S-corp election that fixes it is due within 2 months 15 days of the tax year

Equipment depreciated

Chair or scanner spread over 7 years instead of expensed year one — 100% bonus depreciation was left on the table

IRA only

You fund an IRA but have no practice plan. The 2026 defined contribution ceiling is $72,000 — an IRA caps at ~$7k

Estimates stale

Your quarterly estimates are last year's number, so you overpay all year or owe a penalty

Structure unreviewed

No one has reviewed your structure since you bought in or opened the practice

Preparer, not planner

Your CPA files in April. Planning has to happen before December

Sources: IRS Publication 946; Instructions for Form 2553; IRC §401(a); OBBB Act (2025)

When Dentist Tax Planning Fits

A good fit if:

You own the practice (or a piece of it) and net into six figures
You bought or plan to buy equipment this year — chair, scanner, imaging, buildout
You are on a Schedule C or SMLLC and have never modeled the S-corp
You want to shelter more than an IRA allows in retirement contributions
You are the primary earner in your household and want the plan to cover both returns

Employed doctor rather than practice owner? See tax planning for doctors. Different entity question? Start with LLC taxed as S corp.

Request a Dentist Tax Review

Send the practice's rough numbers and entity type, and the reply lists which deductions and elections are still available before year-end. Confidential, reviewed by a CPA.

"For business owners, make sure you're maxing out any type of retirement plan. There are ones now that will allow you to deduct from your taxes over $70,000. And there are others that can even be in the hundreds of thousands. Many people don't even take a look at that."
— George Dimov, CPA, Founder of Dimov Tax

You don't need to decide anything before the first call. Send last year's return and a rough P&L — that's enough for the review.

Reviewed by George Dimov, CPA

Founder of Dimov Tax

15+ years advising dental practices and professional service owners on tax planning, entity structure, and retirement strategy.