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Most dentists want financial freedom. They picture running a thriving practice, retiring comfortably, and having the flexibility to support their families without worry. Many believe this requires one big break or a single powerful tax loophole.
The reality is different. Lasting wealth is rarely the result of one major move. It is built by consistently applying smaller tax strategies that save money year after year. When these are stacked together, the results are dramatic.
In Episode 129 of The Dental Boardroom Podcast, Wes Read, CPA, explained how dentists can use payroll for their children, Roth IRAs, and 529 education savings accounts as part of a broader system. Alone, each tactic may not feel life-changing. Together, they can reduce taxes by 30 to 60 percent, and sometimes even more.
Dentists are high-income earners, which places them in some of the highest tax brackets. Without planning, too much of that income ends up with the IRS. Smaller tax strategies help reverse that.
Examples include:
Individually, none of these strategies will change your financial life overnight. Together, they can add up to tens of thousands of dollars every year.
Many dentists avoid smaller tax moves because they are concerned about raising red flags with the IRS. In reality, the IRS does not prohibit you from hiring your own children or using legitimate deductions. What matters is documentation.
Clear records turn a potential issue into a proven, defensible strategy.
Small tax savings build like compound interest. Over years, they grow into significant amounts.
Consider this example:
That is over $40,000 kept in the family instead of going to the IRS. Repeated for 15 years, that amounts to more than $600,000, not including investment growth.
For dentists in their later years, adding a defined benefit plan can push the savings even further. In some cases, taxes can be reduced by as much as 80 percent.
Financial independence is about more than hitting a target number in your accounts. It is about creating options and control. Every dollar kept from the IRS and redirected into your own accounts speeds up that process.
Together, these strategies allow you to keep more of what you earn and give your family a stronger future.
Wealth in dentistry is not about one large deduction or a perfect investment. It comes from consistently applying every available strategy and redirecting money from the IRS back into your personal balance sheet.
As Wes Read said in the podcast, “Tax planning and wealth accumulation is like stacking quarters. It may not feel huge in the moment, but add them up over years, and it’s a fortune.”
Dentists who achieve financial success are not just high earners. They are planners who use every opportunity to reduce taxes and grow wealth. By layering payroll for kids, Roth IRAs, 529 plans, home office deductions, automobile use, and retirement plans, you can keep tens of thousands of dollars every year.
No single strategy may feel like a breakthrough. But together, they can cut your tax bill in half, accelerate your path to financial independence, and provide lasting security for your family.
Want to learn more about how small tax strategies can create big long-term wealth?
Listen to Episode 129 of The Dental Boardroom Podcast: Money Well Spent (Part 2)
Wes knows what's best for dental practices. He's been doing this for a long time and he sees lots of practices. He can tell me how our practice is doing, and what we can do to increase our productivity. With past CPA's, there were no ideas. It was all coming from me, saying "I think I can do better, but I don't know how." I come in to meet with Wes and he says "You CAN do better, and I know how."
PracticeCFO is in hundreds of dental offices around the country. They know what numbers should look like. They know what percentages of payroll, rent and supplies should be, and they will hold you accountable to those numbers, which will really help you stick to your plan and your path of growth and savings. That is invaluable
Whenever something comes up, whether it's building or practice related and we weren't sure where the numbers would go, PracticeCFO has been instrumental in helping us figure that out. I can't say enough of how important that is - that it goes beyond that initial partnership. They make sure this business marriage works.
When I go home from work, I don't spend a whole lot of time stressing about what my books look like, or how much I owe in taxes. By using PracticeCFO, the burden of keeping track of a lot of the big financial numbers and metrics are taken off my plate.
PracticeCFO helped me develop a plan for the future. I have colleagues that work with other accountants that don't have a plan - they just look at the numbers of the practice and that's it. There's no plan for 10, 20 years from now. But with PracticeCFO, you get that. PracticeCFO makes you feel like you're they're only client.
(In reference to his practice sale) What could've been super stressful, wasn't! When picking John and Wes, it was from word of mouth recommendations and other people's experiences from the past that really did it for me. And it turns out that those recommendations were right on the line.
Wes knows the business side of dentistry. His comprehensive plan will organize your personal and professional finances so you can focus on taking care of patients. Massive ROI.
I can’t say enough good things about everyone at PracticeCFO. Everyone on the team is professional, organized, knowledgeable, helpful and kind. They also respond to emails and phone calls immediately and are always happy to help. They have helped me navigate year-to-year as a business owner. PracticeCFO gives me peace of mind that my business is in good hands.
I love Practice CFO! They have helped me obtain a practice and maintain a practice. They are incredible people who are on top of everything and make owning and running the business portion of a practice easy. They couldn’t be better for my business and my sanity. They have every detail of the business and taxes taken care of where all I have to do is show up and follow their easy steps to success!
Practice CFO has the best tools I’ve seen for personal tax and financial planning in addition to top-tier corporate tax and accounting services. I have been very pleased with the level of quality service. They manage my monthly bookkeeping and accounts payable. It is a great system and saves me a ton of time, and it allows us to have monthly financial statements within a week of month end.
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