Last Minute Income Tax Tips for Dentists, Part 2: Credits and Deductions

You probably heard about the tax and spending bill that Congress passed in December 2019. One of the biggest components of it is set to dramatically change retirement planning, and dentists should be paying attention. The deadline to fund an IRA with retroactive contributions is April 15, and with the SECURE Act in mind, there are a few strategies you may want to employ.

One is to start transferring tax-deferred assets into a Roth IRA. Roth IRAs don’t have required minimum distributions (RMDs), and even considering the extended age of 72 for RMDs with traditional IRAs, if you gift the Roth IRA, your heirs can cash out the assets tax-free after ten years.

You can read more about the SECURE Act on Naden/Lean’s blog here.

If you’re still paying on your student loans from dental school, the spending bill contained another tax extender you should be aware of, the above-the-line deduction for qualified tuition and related expenses.

Other tax credits and deductions not to miss are:

QBI: The Qualified Business Income Deduction won’t be available for all dentists, but for those who will get a partial or full deduction, it’s worth checking into. Income limits in 2019 began to phase out at $315,000 for married filing jointly and $157,500 for everyone else, and after $415,000 and $207,500 for married filing jointly and all other filers, respectively, there was no benefit.

There is a real estate component to QBI – you can read about it here – and it’s worth checking into before you file your taxes.


Lifetime Learning Credit: if you, your spouse, or a dependent took any college classes last year, whether toward a degree or not, you can claim a 20 percent credit on tuition expenses with a $2,000 maximum on the first $10,000.


Home Office Deduction: do you manage your practice’s financial records or strategic planning at home? If you have a dedicated space for it, you can probably claim the home office deduction. There are two methods to use, simplified and actual cost. Talk to you CPA to find out which one is the best for you.


Job-Related Expenses: You can deduct your association dues to the ADA as well as uniforms, continuing education, and travel for work (except for commuting to and from your practice).


Finally, if your dental practice is an S-Corp, there are a few things you can do to lower your tax liability. These are:

  • Lower your wages
  • Employ your children
  • Have the S-Corp cover your healthcare premiums


Are you prepared for tax season? Contact your Dental CPA for questions or guidance.