The Dentist's Network #83

Bruce Bryen, CPA.
Managing Partner
The Snyder Group, LLC
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A Significant Year End Tax Planning Tip

As we approach the end of the year, many dentists look for ideas to reduce their tax burdens. One significant idea is for the dental practice to implement an employer sponsored qualified retirement plan. It is not too late for some creative design features to be used to secure a large contribution for the dentist and key employees that he or she wish to participate in the plan. The planning can feature concepts to keep employee contributions not critical to the vitality of the dental practice at lower levels than key people. So how much can be deducted?

The deductions for 2009, based on variables in a specific practice, can approach $150,000. When considerations are given to minimal deductions and the amount of time and effort needed to achieve those, the amount of $150,000 should seem staggering. Time should be taken to absorb this. In a state with a high income tax rate, the top federal tax rate, the Medicare rate and the amount attributed to social security, when combined, will near or exceed 50% of your income. That means that a deduction for $150,000 will create a tax savings of $75,000 for 2009.

Where will the funds come from to pay this? Remember that the deduction will reduce your taxes. Part of the funds will come from your tax savings. The need for $150,000 is immediately reduced by half because of your tax rate. After that calculation, the balance needed is about $75,000. Did you know that the payment is not due until your tax return filing date, including extensions? If you have an “s” corporation or an llp or llc, with an extension until September 15, 2010 for your 2009 return, you can take the deduction on your tax return for 2009 for the entire $150,000 and not have to fund that amount until September 15, 2010. Half of the contribution can come from estimated tax payments, and the other half from income in the succeeding year. This does not even take into account borrowing strategies and other ideas that your personal advisors are probably already discussing with you.

Hopefully, you are already working with a CPA who has a lot of experience working with dentists. He or she will know a lot about the formation of this type of retirement plan, or multiple plans if needed to secure the amount of contribution level to fit your goals. The CPA will know your ability on a personal level to be comfortable with the planning and costs and documentation needed to begin.It is important for your advisor, or a new advisor if yours is not proficient in this area of expertise, to have your personal financial information and that of your dental practice available. This will allow the study necessary to complete the analysis to be done with full knowledge of all the financial data that will assist in the ability to design the most appropriate employer qualified retirement plan for you.

How much will this cost? The initial plan design, including meetings with the CPA and the review of all of the relevant financial data and the coordination with actuaries who understand the goal, will probably cost about $7500 to $10,000. This will probably include the submission of the plan for approval to the IRS. The experience and expertise of those retained to implement the goal of the large deduction and the ability to pay for the deduction is crucial to the successful outcome of the exercise to accomplish this. After the first year, the annual charges for the administration of the plan, or plans if need be, will cost about $3000. Be careful not to have someone who agrees to administer and design a plan for a low or no cost, based on the investments that will come to them or based on the insurance policy that you will buy, be the one who is in charge of its implementation. Those who work with these theories are not really interested in the proper design or the annual administration of the plan. They want to manage your investments and are “selling” the design and administrative services cheaply to get in your door. The plan must be customized to fit your needs. Only someone with the expertise to do so will be able to support the deductions in the event of a tax audit.

It’s not too late to get a significant tax deduction for 2009. You should speak to an advisor very soon to start the process.

Bruce Bryen, CPA has successfully assisted dentists with their personal and financial matters for more than thirty years. As a partner in The Snyder Group, he delivers creative and prudent financial strategies to help dentists build and protect wealth at every stage of their careers. His extensive expertise includes financing, debt restructuring, retirement planning and tax advising to help dentists keep more of what they earn. Bruce is also experienced in providing litigation support services and has testified on numerous occasions as an expert witness.

If you would like additional help or are interested in having Bruce Bryen speak to your dental society or study club, he can be reached at bruce@thedentistsnetwork.net or at 1-800-988-5674.

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Louis Malcmacher
DDS MAGD
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Power to the People

I have been privileged over the years to speak many times for the Academy of General Dentistry, both at their annual session and for many of the Academy of General Dentistry’s constituent groups. We are very lucky to be represented by two crucial organizations, the American Dental Association (ADA) and the Academy of General Dentistry (AGD). The American Dental Association broadly represents all dentistry in the United States, which includes both general dentists and specialists as well as forging relationships with others involved in the dental industry. The ADA is very politically involved and represents dentistry’s interests on a local, state and national level.

The Academy of General Dentistry’s mission is to represent general dentists and our ability to treat patients on a broad scale. Here is their mission as posted on the AGD website – “the AGD’s mission is to serve the needs and represent the interests of general dentists, to promote the oral health of the public, and to foster continued proficiency of general dentists through quality continuing dental education in order to better serve the public.”

The core values of the AGD are:

Excellence in oral health care.
Diversity
Universal acceptance of the general dentist as a gatekeeper of oral health care
Continuous, life-long learning
Advocacy and representation
Teamwork, camaraderie, and mentorship
Ethical, honest, and credible behavior

The Academy of General Dentistry has an unbelievably strong educational component and indeed, many dentists join the AGD to attain fellowship and mastership status through literally hundreds of continuing education hours of both lecture and participation courses. There is no question to me, as I lecture to thousands of dental professionals every single year, that the most successful dentists are also those who believe in continuing education and come out to learn about new products, techniques, technology and ways to improve their patients’ health and make their practice of dentistry faster, easier and better.

With that introduction, I was privileged and honored to speak at both the annual sessions of the Texas Academy of General Dentistry and the Alabama Academy of General Dentistry. One of the wonderful things about the Academy of General Dentistry is how its national leadership continues to reach out to every single member. At the Alabama Academy of General Dentistry Annual Meeting, which is a four-day event, Dr. Paula Jones, immediate past president of the AGD, was there talking to constituent members. Dr. Tim Brooks, President of the Alabama AGD, and his great team including my host, Dr. Hunter Pope, put on an exceptional meeting with an exhibit room full of manufacturers that looked like some state dental meetings that I have spoken at. You know that these dentists are dedicated to continuing education when they are sitting in a lecture hall on a beautiful September day in Destin, Florida, with the hotel right on the beach.

At the Texas AGD Meeting, Dr. Chris Perry, who chaired this year’s Lone Star Dental Conference with Executive Director Connie Sonnier, also did an exceptional job putting together a terrific meeting. There were dentists there from all over Texas, who come down to this meeting every single year for continuing education, exhibits, and an incredible banquet to celebrate the past year and to look forward to and plan for the new year. At this Texas meeting, I met up with Dr. David Halperin, the current National President of the Academy of General Dentistry. David gave an impassioned talk to those assembled about what the AGD means to the rights of the general dentists to perform all of the procedures they are trained in and told us some of his interesting experiences representing AGD members in Congress and what advocacy means to all of dentistry. We need strong advocates on Capitol Hill and we are lucky as a profession to have people like Dr. David Halpern and all of the members of the AGD advocacy committee.

The camaraderie at both of these meetings among the AGD dentists is something that should set an example for all of us in dentistry. These were shining examples of dentists who want to help others become better at what we do, either by example or by personal mentoring. There is power in numbers so if you are not a member of the AGD and the ADA, you need to join today!

Louis Malcmacher DDS MAGD is a practicing general dentist and an internationally known lecturer, author, and dental consultant known for his comprehensive and entertaining style. An evaluator for Clinicians Reports, Dr. Malcmacher is a consultant to the Council on Dental Practice of the ADA.

Interested in having Dr. Malcmacher speak to your dental society or study club? Click here. To reach Dr. Malcmacher, email him at DrMalcmacher@thedentistsnetwork.net or call 1.800.952.0521.

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Dr. Lorne Lavine
Dental Technology Consultants
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Word-of-Mouth 2.0: Gain New Patients with Your Online Reputation

In dentistry, your greatest marketing asset is your existing patient base. Word-of-mouth referrals from your satisfied patients provide powerful information for those seeking a new dentist - and they reinforce the decision to do dentistry with you.

Today, millions of people turn to the Internet for word-of-mouth help in making and validating their decisions as consumers. Online ratings and comments, especially for service industries such as dentistry, have taken consumers’ attention by storm. To thrive in this new environment, you need to build your brand in an online world, and manage your online reputation. It will form, with or without you. You choose whether your online reputation will be random gossip, or an orchestrated, persuasive tool to attract new patients.

Your Online Reputation
You likely already have a reputation on the Internet. Your online reputation includes anything about you and your practice, from your web site and online directories to ratings and reviews. Through web sites such as Insider Pages, City Search, Yelp and Yahoo, consumers can review and rate your business, whether they’ve patronized it or not. There is no way to know if their comments are legitimate. These consumers are establishing and fostering your online reputation - without your knowledge or control - and there was nothing you could do to manage this exposure, until now.

Leveraging the Patient Experience Online
As a service provider, your livelihood depends on your reputation. You and your staff work hard to consistently provide the best patient experience, and that becomes your patients’ expectation. Unfortunately, in the rare instances when that expectation isn’t met, patients will go out of their way to inform the world. So how do you “coach” your patients to also share their positive encounters?

You first need to find a way to start the conversation with your patients. There is an exciting new company called Demandforce that can help. Demandforce is an online patient communication software company that realizes the value in asking your patients about their experience with your practice. Each patient is sent a thank you email message after each appointment, and can choose to submit a confidential survey about their visit as well as a public review. Practices can read the reviews and post a response or ask for a review to be removed if it does not meet standard posting requirements.

Tapping into Technology to Attract New Patients
Almost 70 percent of all online searches are conducted using Google, with 3.2 billion visits per month. You can optimize your practice web site to come up in Google’s free, natural search results. You can also subscribe to Google Adwords, paying for each “click” generated from Google to your web site. The higher you bid for a click, the higher your placement in the sponsored section of Google. As with all advertising it has limitations, even beyond expense. Consumers know that ads are self-promotion, and would rather read about someone’s personal experience with a product or service.

Google, recognizing the relevance and power of the first-person testimonial, recently created Google Local Businesses, enabling consumers to search for and compare local businesses online. Type your zip code followed by the word “dentist” in the Google search box. A map listing 10 dental offices is displayed above all other natural search results. To the far right of each listing is a link to “reviews.” This is where a consumer can view what your patients say about your practice - something advertising dollars just can’t buy.

Build Your Online Reputation Now
So how do you, as a dentist, take advantage of this new tool to guide and shape your online reputation? Currently, you have two options. You can hope your patients will take time to participate in this process on their own, or you can use Demandforce. A data integration agreement with Google now gives dental practices using Demandforce a turnkey approach for populating their Google profiles and posting dozens of certified patient reviews each month. Demandforce will also optimize your profile and submit additional information, and can integrate online scheduling directly into your profile. The new Google review functionality is included with a standard monthly subscription.

Solicited or not, online reviews are here to stay. Take charge of your online reputation - ensure it works for, not against, your practice. Manage it well and it will become your greatest source of new patients, and an accurate reflection of the valued practice you’ve worked so hard to build.

Lorne Lavine, DMD is the Founder and President of Dental Technology Consultants. Dr. Lavine holds two prestigious certifications, the A+ Certified Technician designation and the Network+ Certified Professional. These designations demonstrate proficiency in computer repair, operating systems, network design and installation. Dental Technology Consultants provides dentists a full range of services relating to the implementation of technology.

Interested in having Dr. Lavine speak to your dental society or study club? Click here. Dr. Lavine can be reached at drlavine@thedentistsnetwork.net.

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