Leveling up your dental practice with a dental-specific CPA
Maximize more than practice revenue with your trusted practice advisor.
There’s a reason CPAs are considered one of the most trusted advisors in the business world. As a strategic and unbiased partner, they are committed to learning all aspects of your practice, including financial, operations, personnel, and marketing. From strategic tax planning and cash flow monitoring, to valuing a practice for acquisition, or determining whether to lease or buy equipment, a dental CPA can help provide you a roadmap for success. For both aspiring and established dental practice owners, having a CPA with dental-specific expertise on your team is a must.
Benefits of working with a dental-specific CPA (and how to make the most of your partnership)
Dental CPAs are highly attuned to the needs of a dental practice. Leveraging specialized experience, they can provide insights and expertise a traditional CPA may not be able to offer. With the right practice management and bookkeeping software, a dental CPA can organize and present your financial data in a useful format, empowering you to enhance your dental practice operations (and make actionable, data-driven decisions). Ask your CPA if they’re able to help you with the checklist items below:
- Identify the most lucrative services your dental practice offers so you can maximize on those services. For example, your CPA may uncover an opportunity to perform more sealants rather than focusing on routine exams.
- Recommend areas for improvement within your operations to maximize revenue. Is your office using best practices based on your CPA’s knowledge of other successful dental practices? Is your dental practice’s production appropriate for the number of team members?
- Tap into new opportunities for team members in the dental practice to enhance the patient experience, optimize processes, and increase revenue. Optimize coding at the front desk. Teach hygienists to refer necessary services to the dentist. Ensure receptionists respond to all patients within 24 hours … these opportunities for improvement (along with others) can be small changes that make a significant impact.
- Review your annual fee reimbursements to ensure your dental practice is in the top 80–90% of practices within your geography and demographic (and capitalize on your CPA’s database of other successful dental practices). Your CPA can calculate the increase in service fees each year to effectively keep up with the rising costs of supplies, equipment, and payroll.
- Support tax planning and strategies. (The exciting side of owning a business, right?) Taxes shouldn’t be considered only annually — it’s important to plan throughout the year. What tax deductions are available to you? A dental CPA will ensure all your equipment is properly coded for things like measuring depreciation for accurate tax write-offs. In addition to deducting student loan interest, new dental practice owners may be eligible for a qualified business income (QBI) deduction — that’s up to a 20% reduction in reported practice income, under recent tax law revisions.
- Help plan for retirement so you can maintain your lifestyle at the height of your career upon retiring. Having an expert on your side as you plan for retirement can give you peace-of-mind and ensure you’re setting your future self up for success. Most retirement savings plans are tax deductible (like deferred retirement accounts), giving you a 25–30% return on your investment automatically just from tax savings alone.
Reaching the next level (ways to help your dental practice thrive)
Practice operations and accounting go hand-in-hand. Dental CPAs are unique in their ability to connect areas of the business that may seem unrelated but actually have direct impact on revenue. With a proactive approach, a CPA specific to dentistry can help you develop the qualities of a thriving dental practice and identify areas for improvement. To measure the health of your dental practice, ask yourself the following:
- Do you have a clear vision? Is your team aligned and committed to carrying it out with you?
- Do you have genuine relationships with each member of your team? (Knowing the interests and lives of your people outside of the office can go a long way. When employees feel seen and known, they are more likely to take ownership of their roles and the greater vision.)
- Is every team member tracking metrics relevant to their roles? Gamification of tracking metrics can be a fun way (no, really!) for your people to remain engaged and connected to their roles. A few ways to put this idea into play: How many services (filling, crown, etc.) did the dental hygienist refer to the dentist and successfully book? How many new prospective patients did the receptionist convert and schedule?
A dental CPA’s advice and wisdom will extend beyond just the numbers. Consider adding a CPA as one of the first members of your practice advisory team. If you’re looking for a dental-specific CPA, browse an organization like The Academy of Dental CPAs (ADCPA) with 28 CPA firms around the country who all work with dentists in the same way.
For more information on this topic, check out episode 13 on our podcast, The Path to Owning It. If you’re looking to finance a dental practice or view practice listings in your area, head to getprovide.com to get started.
This content is for informational purposes and does not constitute the rendering of legal, accounting, tax, or investment advice, or other professional services by Provide or any of its subsidiaries or affiliates, and it is being provided without any warranty whatsoever. Please consult with appropriate professionals related to your individual circumstances.
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