Dentists spend years studying to care for their patients’ dental needs. But during all that clinical training, precious little time is spent teaching dentists like you the skills you need to run a successful dental practice, like people management, operational, and financial management.
That final one is critical because, without skillful financial management, your practice will struggle to make money. That’s why finding the right dental accountant for your practice is one of the first things you should do as a new practice owner.
Your clinical skills are why your practice exists and can’t be replaced. But the goal should be to get you focused on delivering superior care rather than sweating over payroll or worrying about pricing strategies. In an ideal world, your accountant works as your partner to take the stress out of finances so you can focus on being the best dentist you can be.
In this article, you’ll discover why dental accountants are vital to your success. You’ll learn how the right financial professional can help you navigate the complexities of dental accounting, tax deductions, and financial growth strategies to create a highly profitable dental practice.
Why Do You Need A Dental Accountant?
Dental practices have unique financial needs specific to the industry that other businesses don’t necessarily face. An accountant specializing in dental practices will understand your needs better than a general-purpose Certified Professional Accountant (CPA), so they’re better positioned to ensure your practice’s finances are strong while maximizing available tax benefits.
Imagine trying to perform a complex dental procedure with generic tools not designed for the job. The results would be messy at best and disastrous at worst — you’d take the profession back a few decades, at least!
Well, using a general accountant for a dental practice is kind of like using unspecialized tools. The nuances of dental finances require a specialist’s touch, someone who deeply understands where to look to save you money or avoid a costly tax penalty.
If you find the right dental account, they can help you with everything from financial management to tax prep to strategic operational guidance. These are tricky elements for even an experienced dentist to navigate alone. And they’re vital to your practice’s short-term and long-term success.
A dental CPA is an incredible resource for recent dental school graduates without business experience running a practice. At the same time, most experienced dentists continue to rely on the guidance of professional accountants because they know that choosing dental CPAs has been critical to the success of their business.
With a dental accountant handling your practice’s financial aspects, you can confidently focus on delivering excellent patient care.
Key Services Offered By Dental Accountants
Your dental accountant can help you manage the challenges of business ownership, including tax management, employee payroll setup, financial planning, and practice growth support. They’ll help you assemble and read your financial reports to make smarter business decisions that help you make more money. Overall, their expertise will help you navigate the business world of dental practices to ensure robust financial health.
Dental CPAs have your back, whether it’s organizing your financial transactions, tracking expenses and revenue, providing accounting and audit services, or offering expert advice. Finding the right one will help you leverage their experience to ensure your business builds a solid and sustainable financial foundation.
An accountant can also serve as a liaison between your practice and various stakeholders, like banks, governmental agencies, and even insurance companies. That extra level of insulation keeps you from getting lost in the weeds and taking on unnecessary stress that could impact your ability to focus on your patients.
Tax Management & Compliance
Your practice must manage complex tax and compliance issues based on tax laws and regulations that vary depending on your locality. Plus, regulations can change from year to year. Without an experienced dental financial professional at your side, you’d have no idea.
Your dental accountant will help you with tax planning, tax filing, and fulfilling reporting requirements set by federal, state, and local tax authorities. It’s a complex process that could leave you feeling helpless on your own. But your accountant will ensure you take advantage of available deductions and credits while minimizing tax liabilities and avoiding legal issues, so it’s an investment well worth the cost!
Strategic tax planning comes up big when making tough business decisions, especially those involving overhead expenses, payroll, or equipment purchases. Your dental CPA can help you determine the best times to make major purchases to wisely use depreciation deductions and save money while still meeting your tax obligations. In almost every case, the cost of hiring a dental CPA will pay for itself in tax savings year after year.
Financial Planning & Budgeting
Your CPA will help you make smart financial decisions related to operations, marketing, and personnel, which starts with an annual budgeting process. Decisions on leasing or purchasing equipment, raising dental fees, or adjusting staff compensation should never be made in a vacuum.
With your CPA’s financial planning and budgeting assistance, you can ensure that every decision regarding your practice’s revenue, payroll, operational expenses, or investments fits into your larger financial business strategy.
Working with a dental accountant will help you optimize your practice’s financial health to remain profitable and well-positioned for profitable growth.
Practice Growth & Transition Support
Any time your practice is experiencing change, whether annual practice growth or a significant transition, having a dental accountant can help you navigate those changes smoothly to reach your goals.
For example, a dental CPA can help you with:
- Short-term and long-term strategic planning
- Detailed financial analysis
- Evolving marketing strategies
- Operational improvements and optimizations
- Practice acquisitions or mergers
Suppose you’re considering buying another practice, selling your own, or transitioning out of your practice. In that case, a dental accountant with industry experience will provide invaluable guidance and support. They’ll help you confidently navigate an often stressful process to make better decisions and set yourself up for success.
Factors To Consider When Choosing A Dental CPA
When choosing a dental CPA, you should look at a few different factors:
- Industry knowledge
It’s also important that their values and personalities are compatible with you and your practice. Ultimately, if you don’t feel confident in their abilities or the service you’re receiving after three to six months, it might be time to look for a new partner. A productive working relationship with your CPA is essential to your success.
Dental Industry Expertise
We can’t stress this enough — a dental accountant who understands the nuances of the dental industry will understand the specific financial requirements and difficulties you face as a dental practice owner. Therefore, we strongly suggest only working with an accountant with extensive industry experience.
Credentials And Certifications
Ideally, your dental CPA should have earned their CPA (Certified Public Accountant) license, demonstrating their accounting and finance competence. A CPA will help ensure you comply with Generally Accepted Accounting Principles (GAAP), a set of rules governing how accountants should record and report financial activity.
Location & Accessibility
You should consider the location of your dental accountant for a couple of reasons. First, an accountant in your area is more likely to stay up-to-date on local tax laws. Any accountant can (and will) do the necessary research. Still, a dental accountant located close to home gives you an advantage.
Secondly, having convenient access to your accountant can be a difference-maker. If you can meet up with them face-to-face to discuss your finances or critical decisions, it can be a big help. It’s not 100% necessary; you can do virtual meetings and send documentation online. However, many dentists prefer to work with a local accountant for accessibility.
Steps To Finding Your Ideal Dental Accountant
You should plan to invest some time researching potential dental accountants to assess their compatibility with your practice. The right dental accountant by your side can be the difference between struggling to make payroll and feeling free from worries about cash flow, so it’s worth taking your time to choose the perfect candidate.
Ask your colleagues or professional associations for recommendations of dental accountants in the area. It’s possible that a friend, banker, or insurance agent might have suggestions as well.
If you can gather some recommendations from people you trust, it’ll save you a lot of time narrowing down your choices. But you can also search online, of course, if you’re coming up empty through your network. Assemble a list of possible candidates and get to work sorting through them.
Research Potential Candidates
Once you have a target list of dental accountants, research them by checking their websites, reviews, and client base. You should be able to assemble an initial picture of their experience and reputation to gauge whether you’d trust them with your practice’s finances.
Create a shortlist of potential dental accountants who align with your practice’s financial goals and requirements.
Scheduling consultations with potential CPAs lets you discuss your needs, ask questions, and see if they’re a good fit for your practice. When attending a consultation, bring a list of questions and concerns.
If you need help with what to ask, search for some online resources for questions to ask accountants so that you don’t come in empty-handed. Even some generic questions will get them talking and give you a better idea of their communication and problem-solving skills.
It will be hard for you to assess their financial mastery with any authority, so this is more of an opportunity to get to know the accountants and gauge their communication style, responsiveness, and company values.
Evaluate And Decide
After you’ve done your research and had some meetings, it’s time to choose the best dental accountant for your practice. You’ll want to consider factors such as:
- Services offered
- Communication and responsiveness
- Technology and software used in their practice
Weigh each candidate’s strengths and weaknesses against your practice’s needs. Then, pick the dental accountant that you feel can best support your growth and financial success.
The hope is that this will be a long-term partnership, and switching accountants isn’t necessarily fun. So give the working relationship some time to develop. But if you’re ultimately not getting the support you need, you can always move on to another of the CPA options on your shortlist.
Boost Your Dental Practice’s Growth With A Dental Accountant
Engaging a dental accountant helps your practice grow through intelligent financial management, tax savings, and strategic guidance during transitions. By effectively managing your finances, creating a growth plan, providing critical insights, and analyzing your progress, your CPA becomes your partner in revenue and profit growth.
If you don’t have a dental accountant already, their expertise could be a game-changer for your practice. And if you have a dental accountant who doesn’t feel like a true partner, then it’s time to relook at the options available to you.
With the proper dental practice accounting partner, you can focus 100% of your energy on what you do best — delivering exceptional dental care to patients. And that’s what gives your practice the best possibility for success!