How Dentists Can Reduce Tax Burden with Equipment Purchases

May 21
2 min read

Running a dental practice means balancing excellent patient care with complex financial responsibilities. Among these, minimizing your tax liability is one of the most strategic moves you can make to maintain healthy margins.

One of the most effective (and often underutilized) tax-saving strategies for dentists is leveraging the tax code to deduct equipment purchases.

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Understanding Section 179 and Bonus Depreciation

The IRS offers two key provisions that dentists can use to their advantage:

Section 179 Deduction
This allows you to deduct the full purchase price of qualifying equipment and software purchased or financed during the tax year, up to a certain limit. For 2025, this limit is expected to exceed $1 million, making it ideal for practices investing in high-cost items such as digital X-rays, dental chairs, or CAD/CAM machines.

Bonus Depreciation
After reaching the Section 179 limit, bonus depreciation allows you to deduct a percentage of the remaining cost of eligible property in the first year it is placed in service. This percentage changes annually, so consulting a tax advisor is essential for up-to-date planning.

What Qualifies as Deductible Equipment?

Common examples include:

Intraoral scanners and imaging devices
Dental chairs and lights
Sterilization equipment
Office computers and dental software
HVAC systems (if considered part of building improvement)

Even used equipment may qualify—if it's new to your practice.

Timing is Everything

To take advantage of these deductions, equipment must be purchased and placed in service before the end of the tax year. Planning purchases strategically—especially in Q3 and Q4—can lead to significant write-offs that lower your taxable income.

Financing Can Still Qualify

One of the biggest misconceptions is that you must pay in full to receive deductions. Not true. Financed or leased equipment can still qualify for Section 179, allowing you to enjoy tax benefits before full payment is due.

Let the Numbers Work in Your Favor

For example, purchasing a $100,000 dental laser system could potentially yield $21,000 to $35,000 in tax savings, depending on your tax bracket and timing. Multiply that effect across multiple pieces of equipment, and the savings become game-changing.

🧾 Let ISTAXPRO Guide Your Tax Strategy

At ISTAXPRO ACCOUNTING FIRM, we specialize in working with dental professionals in Burbank, CA and surrounding areas. From optimizing equipment deductions to structuring your practice for tax efficiency, our team ensures your finances are as precise as your work.

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