Jay Malik, EA talks taxes and deductions for dental practices. He shares a wealth of knowledge and a free Nifty Thrifty Deal.
What is an EA? An enrolled agent, a licensed tax person who can represent people before the IRS.
Why did you work with dentists? They don’t have the God complex like the surgeons they had worked with initially.
What are common mistakes you see in dentistry? Most all dentists overpaid.
Make sure you are practicing in the right entity. You can practice as a different entity for different parts of your practice. Learning to stack them appropriately can be advantageous.
How can you pay fewer taxes? It depends on the types of practices and needs.
What can you write off legitimately? There needs to be a business reason. Writing off travel requires a minimum of 4 hours of business-related time to write off the trip.
Most dentists can and should set up as an S-corp
Vehicles that are used for business can provide a good write off. Keep a simple mileage log with mileage and purpose.
Can you pay your kids for work done in your practice such as photos for marketing?
To write off meals, write on the receipt who you were with and what was discussed. All receipts need to be kept at least 3 years.
Can you take more in distributions than your W-2 salary? It all comes down to reasonableness.
A home office is a reasonable deduction if you do work such as management or accounting from home. You can also write off the mileage from your business location to your home office.
Owning or leasing a car through the business is about personal preference.
His approach is to try to make things deductible when possible.
Can we rent our home out as write it off? Yes, up to 14 days for a comparable rate to a similar house in your area.
You can pay student loans through the business, but you cannot personally deduct the interest.
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