Dentists: Is Your New Equipment Deductible This Year?

If you purchased new dental chairs, imaging devices, scanners, or IT systems this year, you may be eligible for significant immediate tax deductions under current IRS rules. Many dentists miss these opportunities, leaving thousands in unnecessary tax payments.

Here’s what you need to know.

Section 179 Expensing

Under Section 179, dentists can immediately deduct the full cost of qualified equipment purchased and placed in service during the tax year, rather than depreciating it over several years. For 2025, the Section 179 limit is $1.22 million (subject to phase-outs for purchases exceeding $3.05 million).

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Bonus Depreciation

Bonus depreciation allows for 100% immediate expensing of new and used qualified equipment purchased and placed in service within the year. This can be used alongside Section 179 but may phase down in coming years under current law.

Key Considerations:

• Placed in Service: Equipment must be operational before December 31, 2025, to qualify for this year’s deduction.

• Taxable Income: Section 179 is limited to taxable income, while bonus depreciation can create or increase a loss.

• State Conformity: Some states (including California) do not fully conform to federal Section 179 or bonus depreciation rules, requiring careful planning.

Action Steps Before Year-End:

• Review your 2025 income projections to determine if you should accelerate equipment purchases before year-end.

• Ensure equipment is installed and operational before December 31.

• Coordinate with your advisor to align deductions with your overall tax strategy.

At ISTAXPro, we help dentists align practice investments with tax efficiency, ensuring your growth plans also reduce your tax liability where possible.

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