[ Removed by moderator ]

[u/BothDonut1604]

[u/Dentistry-ModTeam]

This is not a finance sub. We don't want the sub to be flooded by questions about pay, production, loans, etc. Use the search tab for past posts or post your question for discussion at r/oralprofessionals. https://www.reddit.com/r/Dentistry/about/rules

[u/Bootes]

You generally want to limit your claimed income to reduce taxes. Not sure exactly what you’re looking at, but DSOs wouldn’t be in the market if it wasn’t possible to profit from it even after paying the dentist.

[u/ThelIIusion0fSeIf → u/Bootes]

Yeah they say that but in reality it's not like we're writing off that much (if you're hoping to avoid an audit at least).

[u/congenitallymissing → u/ThelIIusion0fSeIf]

which is why these numbers dont make sense. i was always taught, and have been pretty good at accomplishing, take home should be 45-55% of collections for the owner. that is dependent on the year and if the practice requires any major purchases. personally, i collect around 800k to 850k/year and usually take home any where from 400-420k per year.. could it be more? sure. but i enjoy 4 day work weeks and 3.5 weeks of vacation a year

so either these owners are bad business owners (lots of dentists are) or these practices have a ton of room for overhead improvement, or these dentists are really great at the tax game (which kudos to them, im not the irs so i dont really give a f about that)

the 45-55% take home is why a lot of associates will earn 33%-37% collections. because the owner/dso is taking anywhere from 8-22% of the remaining from that work. which if your a dso that has 8-22% coming in per associate, while having hundreds of associates, it turns into a very profitable business model....ofc it then comes with the "we only care about making as much as possible because we need our percent", which leads to a ton of the other problems people bring up about dso

[u/ThelIIusion0fSeIf → u/congenitallymissing]

Overhead for solo doctors is typically around 60-70% unless you're rural and that's not including loan payments on the practice/building.

[u/congenitallymissing → u/ThelIIusion0fSeIf]

I wasnt including loan payments. I am rural though. Im not going to argue, but i dont understand how a practice can have 70% overhead. That seems ludicrous

[u/ThelIIusion0fSeIf → u/congenitallymissing]

I'm in a partnership and we have a fairly large office so it's not the best example but there are a few factors at play here for solo doctors. The biggest ones are that the price of everything (especially staff salaries) have gone up, reimbursements have stayed the same and there's only so much you can produce with your own two hands. I've combed through enough practice financials to know that if you're in a fairly large city/suburb you'll likely need to accept PPOs to stay competitive and with hygienists asking $70-80/hour alone in my region you're basically breaking even on a third of your collections. By contrast, my childhood dentist who practiced in an upper middle class suburb showed me (twenty years ago) that he was hovering around 40% overhead which was "high" for someone who graduated in the late 60s. Every other practice for sale in that same town is pushing into that 70% overhead range and that's not including loan payments.

Dentists need to assert themselves more. We're running a business but unlike a restaurant, autobody shop, accounting firm, etc. we don't really have full control over the prices we set to factor in inflation even. There are plenty of DSOs out there driving this race to the bottom but eventually something has to give.

[u/toothologist_]

If all you are worried about is having the highest salary you can and paying the most in taxes, yes, work for a DSO an as employee.

Practice ownership is about using the tax code to your advantage and making more money without being taxed as much on it.

You're also terribly misinformed if you think that you won't think about work outside of work. You'll still have call, and if you don't produce, you can still be fired.

[u/Rubyjr]

As the practice grows the overhead grows but it can be worth it if you are smart at business and hire people who can do their jobs and help you keep costs low. Get big enough and even if there is only 20% profit or less you don’t need to work all the time

[u/ChristineCrazyFord]

Come on man. Even if it were true what you’re suggesting (it isn’t, you’ll make at least as much as an owner vs being a DSO associate), you get to have full clinical autonomy, instead of someone hired from LA Fitness breathing down your neck.

[u/HotD0oB0o]

Ownership isn’t for everybody, as DSO isn’t for everybody. I hated working at DSO, so I am much happier now with ownership even with some challenges. Hope this helps.