I have owned my own dental practice going on 4 years now
I have owned my dental practice for 4 years. Before that, I worked as an associate/employee, so I know how both worlds work. All these figures must be dealing with gross revenue, because from my experience the expenses bring the figure down a whole lot. For example, lets say my practice produced $800,000 dollars last year according to my fee schedule---which equates to about $500,000 collections after insurance is considered. I have 5 employees so annual payroll expenses (including applicable payroll taxes) totaled about $160,000. Annual dental supply expenses totaled about $30,000, lab expenses $40,000 (fixed and removable), small business loan about $60,000, rent about $36000, phone and internet about $6000, insurance about $3000, property tax about $8000, business license renewal about $3000. and about $90,000 depreciation deduction.
Quarterly tax payments are about $15,000 per quarter.
In the beginning (first 3 years), you have a lot of deductions, and the biggy is accumulated equipment depreciation and payroll. With all the deductions aforementioned you can see how a practice making good money may not be well represented if they have a good accountant. On the other hand, when depreciation runs out you can see how the overhead in dentistry is so high that it is very hard to stay ahead. Please take everything you read with a grain of salt because the data may be from net or gross data, and may not take into account everything I mentioned. Are they talking about business owners, independent contractors, or associate employees. A dental practice is VERY expensive to run, and the dentist will always be stuck living off the leftovers.
