AUTHOR: The Dental CFO
May 08, 2023
Owning a dental practice may be something you’ve dreamed of before you were even admitted to dental school. But once you start your practice, the responsibilities of running the business — like filing taxes — can take up much of your time and create stress in your life. And dealing with taxes probably never appeared in your dental school dreams.
That’s okay. You’re a dentist, not a tax expert. That’s why you hire a certified public accountant (CPA). Finding the right accountant to help your business with tax season and beyond is crucial. It impacts how you manage your business (and personal) finances and what you’ll owe when taxes are due.
On the surface, all accountants may seem the same. But as a dental professional and practice owner, you’ll want to think carefully about who you hire to help with your taxes.
The process of hiring a dental CPA begins with asking the right questions. Whether you’re looking for a CPA for the first time or considering changing accountants, use these questions to guide you in your search process.
Why Do You Need a Dental CPA?
Before making calls to prospective accountants, take a moment to ask yourself why you need one. Write down the reasons your business needs assistance from a financial professional.
Are you looking for payroll support? Tax filing and advising? Financial management guidance? Or just someone to get the practice’s bookkeeping off your plate? You’ll likely need a combination of dental practice management services.
When you know what you’re looking for, you can narrow your search for a dental CPA to those with expertise in the areas that matter most to you.
Top Questions to Ask a CPA as a Dental Practice Owner
1. Do you have experience working with dental practices?
When you review a prospective accountant’s background, one critical question you should always ask is if the CPA has experience working with dental practices. Like so many professions, dentistry has unique rules and regulations. A dental CPA who understands the industry can help you maximize any deductions or tax breaks available.
Tax planning for dentists looks different in each practice. For example, you may have a mix of contract and W-2 employees, which require different filing forms. Or maybe you invested in equipment upgrades or a new office, creating the opportunity for deductions. A seasoned dental CPA will know how to use those to your advantage.
If you’re trying to prepare your taxes on your own, or your current accountant doesn’t have dental industry experience, it could cost your business thousands of dollars each year.
2. Will you be a proactive business partner?
An important test for a CPA is how they engage with you and your business throughout the year. A dental CPA who sees you as a partner will be in touch beyond tax season, available when you have questions, and eager to help you make wise decisions.
If your CPA is only available during tax season and you find yourself following up with them to get information, they may not be the best partner for your business.
Hiring a dental CPA is more than having someone who can get you prepared for April 15th. Tax planning conversations should happen year-round, as decisions you make at any point in the year can affect your filing. Finding a proactive accountant can help you plan effectively and mitigate losses.
3. Do you have experience managing multiple practices?
Maybe your practice has many offices or you’re planning to expand in the future. You need to know if the dental CPA you’re considering has experience handling this scope of work.
A dental accountant who has a background in managing multiple offices can guide you through the process of opening a new practice or acquiring an office. They can serve as your dental financial consultant and help you make the right decisions as your business grows.
4. What is your audit process?
Everyone dreads an audit letter from the IRS. If you are audited, you’ll want to have an accountant work with you through the process.
When you’re looking at hiring a CPA, ask about their audit process, how the payment structure works, and what they would do to support you through the audit.
5. What kind of software do you use for managing taxes?
Your CPA will handle filing taxes, but it’s also important to see whether they can work with the existing software you currently use or have their own systems.
Working with a dental CPA with user-friendly accounting software can be a time saver and help you learn more about your practice’s financial trends while giving you insight into your practice’s finances.
6. How will you support my personal financial goals?
As a dental practice owner, you want to reap the rewards of running a financially sound practice. Doing so requires the knowledge of a seasoned professional who can advise you on tax-advantageous retirement plans and how to manage your wealth wisely so it grows over time.
Tax planning for dentists is not just about the business. It also includes your personal taxes and ensuring you can retire comfortably or sell your business for the best price when you’re ready to move on.
Finding the Right Dental CPA for Your Practice
We hope these questions will guide you as you work to find an accountant. The more questions you ask, the better you’ll understand who you’re potentially working with and how they can help your business.
A good accountant is like a business partner who won’t shy away from your questions. Whatever your decision, know you aren’t just hiring someone to prepare financial reports or do your taxes. You’re adding another member to your team to help you with a complicated process that extends well beyond tax season.
The Dental CFO Can Help You Manage Your Practice’s Finances
The Dental CFO team can create meaningful financial reports and prepare tax returns. But our value goes far beyond just financial reporting and preparing taxes.
We deliver CFO-level services to help you build a business with good financial discipline that you’ll enjoy running. We also have proprietary financial management software that makes it easy for you to see your practice’s financial performance numbers and know exactly where your practice stands financially.
We do our best work when we sit down with you, discuss your dental practice, and build a relationship. Then, we offer our expertise throughout the year, regarding practice finances and overall dental practice management.
You can get support for your practice today. The first step is a free consultation to understand your specific challenges and growth opportunities. Let’s get started!