A common question that is asked by professionals, especially medical professionals, and dentists, is whether they should be involved or continue to work as individual doctors.
While in many cases inclusion can save health care professionals and dentists thousands of dollars each year, there are times when it can do little to gain. You can also consult with professionals before undergoing dental incorporation in Framingham via https://ashdentalcpa.com/practice-incorporation/.
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The following is a list of some general points to consider when starting a professional medical or dental business:
1) Tax deferral
There is a possibility of deferred tax if the income generated by the company is compared with the income from a sole proprietorship.
Companies can assist shareholders (i.e., doctors) with income in the form of salaries and/or dividends, and excess profits can be deposited with the company for investment in other assets. Taxes are collected on this income which is withheld at the company until it is paid to the shareholders.
2) Choice of year-end for tax reporting purposes
The company may, at its sole discretion, choose the end of taxation versus the end of the calendar year required for individual tax reporting purposes. With the right advice, this flexibility can offer shareholders tax planning options.
3) Reduce personal risk (bankruptcy protection and limited liability)
Medical or dental professionals are considered separate legal entities from medical or dental professionals for legal reasons, which can help protect creditors.
Dental CPAs do more than just perform annual reviews and prepare your taxes. They have the capabilities to give business advice, analyze the financial health of your business, perform long-term financial planning, give input on investments of dental equipment, and guide you in best business practices.