Common embezzlement myths.

With published statistics suggesting that embezzlement strikes three in five doctors at some point in their careers, this topic is of interest to every professional owning a medical or dental office, and tackles some of the biggest areas of misunderstanding concerning embezzlement in professional offices. Many readers will be surprised to learn that many of the steps that are frequently advocated to control embezzlement are, in fact, ineffective. This article suggests an approach that is quite different from what is normally recommended, and yet is far easier to implement than conventional embezzlement-control strategies.

Considering the health care entity C corporation conversion to tax pass-through entity status.

The double taxation of C corporation income from operations and from the ultimate sale of its assets makes the C corporation an inefficient tax status for many health care entities. At the time of this writing, the changes in the federal tax law that are scheduled to take effect in 2013 will increase this level of double-taxation inefficiency. The owners of a C corporation practice can avoid the C corporation status tax inefficiency by converting the practice to either (1) S corporation status or (2) LLC status. The conversion of the health care C corporation to an S corporation may be accomplished without a current tax cost. However, the conversion of a health care C corporation to an LLC status can result in a current tax at both the corporation level and the shareholder level. Nonetheless, the current conversion tax cost may be less than the future tax cost (1) of operating the practice as a C corporation and incurring double taxation at what may be higher tax rates or (2) of incurring the higher tax cost (or reduced price) on the ultimate disposition of the practice assets and the attendant double taxation of the appreciation in the value of the practice assets. Since individual income tax rates on qualifying dividends from C corporations and on capital gains are currently at very low rates, this may be a good time for C corporation practice owners to consider the costs and benefits of a conversion to either S corporation status or LLC status. The practice owners should consult with their accounting, legal, and valuation advisors in order to consider all of the costs and benefits of a possible corporate tax status conversion. An estimation of both the costs and benefits of the corporate tax status conversion depends on the concluded fair market values of the medical practice, dental practice, or other health care entity assets. And, that practice asset appraisal should encompass all of the practice assets, both tangible assets and intangible assets.

Reface, remodel, or rebuild your dental office.

Upgrades to a dental practice can range from a minor facelift to all new construction. Consulting a certified public accountant is important to properly account for all the various assets that go into a new office so the tax benefits from each can be optimized. After all the dust has settled, practitioners will be able to take pride in their new dental facility and enjoy their surroundings for many years to come.

Implementation strategies for incorporating new technologies into the dental practice.

Staying ahead of the technology curve is an ongoing challenge for all dentists. Ignoring advancements in technology and the related improvements in diagnostics and delivery of care, as well as the impact technology may have on productivity in practice, is simply not an option for the modern clinician who aims to maintain a successful contemporary practice. This article delivers some insight into the challenges that arise when upgrades in technology and the related acquisition investment are considered.

Basic bookkeeping and avoiding theft.

Bookkeeping practices in dental offices may be relatively simple, but care must be taken to prevent employee theft. Well-chosen accounting software and routine office practices may facilitate smooth operations. Systems of internal control should be established to safeguard the practice's finances. The dental practitioner should be very involved in their practice's accounting to maintain order, prevent theft, and keep costs under control.

Financial due diligence in purchasing a dental practice.

Purchasing a dental practice can be a minefield. The office you are looking at could be the most beautiful office with all of the newest technology. But if it is not profitable, it will be a nightmare. This article will help navigate what the dentist and his or her CPA should be looking at when reviewing the books and records, based on the author's experience of reviewing more than 400 dental practices on behalf of buyers.

Opening a new office: the dentist's personal frontier.

BACKGROUND: The purpose of this article is to assist the dental practitioner by providing insight into commercial real estate and a framework for identifying and securing new office space, as well as by addressing concerns about the physical space of a dental practice. CONCLUSIONS: In the process of identifying and securing new office space, the dental practitioner can maximize efficiency and minimize risk by assembling a team of professionals to assist him or her. This team should be composed of an accountant and an attorney, as well as a dental equipment/design specialist and a commercial real estate professional. PRACTICE IMPLICATIONS: The professional team will provide invaluable assistance to the dentist, enabling him or her to avoid major financial, legal, logistic and real estate-related pitfalls inherent in establishing or moving a dental practice.