I recently listened to a Dentaltown podcast that featured Bill Rossi of Advanced Practice Management in the Twin Cities. Mr. Rossi is a well-known practice consultant with a great reputation and the podcast highlighted the common traits he saw in successful practices. He provided his professional opinion, but also employed a statistician to review his clients’ numbers and back-up his assertions.
I agreed with many of his points, but also found a few other similarities between our highly successful dental clients - that is, practices that collect at least $1,000,000 per full-time doctor and have overhead of no more than 60%. Of course, there are many ways to define success, and I won't claim that revenue and take-home pay are the only measures. However, if you want to create a high-volume, high-profit practice here is what I believe needs to be done.
Over the past years, it seems the IRS is placing more emphasis on ensuring businesses are complying with the 1099 reporting requirements. The belief is that by encouraging compliance at the business level, that the problem of unreported income will gradually diminish.
The biggest change that we have seen is the IRS now asks 2 questions on business tax returns and Schedule C’s for the self-employed:
We believe that the answer, for most companies, should be "yes" on both counts.
Donald Trump is the President-Elect of the United States and with the House and Senate controlled by the Republican party there’s a good chance we may see some reform in the tax code. Based on some of the policy proposals that have been floated here is what we think will happen:
Quite a few of our clients are dentists and many have started to use technology that allows them to manufacture their own crowns - as oppose to sending the impressions out to a lab. For the dentists who use this in-house "manufacturing," it begs the question of whether or not they should receive the Section 199 Deduction ("Manufacturers Deduction") when determining their tax liability.
In what has been a unique presidential campaign, we have received the first surprise of October. The New York Times received copies of Donald Trump’s tax returns from 1995, which showed he had a loss of $916,000,000 due to the failures of two casinos and one hotel. While the loss was huge (or "yuge") and possibly would call in to question his competence as a business person, some are wrongly angered by Trump's legitimate use of tax law.
Due to the large loss, Trump was able to carry forward the losses to reduces his taxable income in future years. Many have suggested this indicates that the system is rigged for wealthy people or that Trump has not paid income taxes in a long-time due to this loss.