How Dental Practice Growth Affects Payroll
In life, we tend to be very focused on growing and evolving on both personal and global matters. From looking to grow a specific skill set or picking up a new hobby, to evolving technology and coming up with new environmentally friendly options, growth is always present in our lives.
As a dentist, we are willing to bet that you spend a lot of time striving for growth and expanding your practice. With that growth comes change, some of which can be confusing, especially when it comes to payroll. Vincent Cardillo, MBA, broke down the six stages of growth in the dental industry. Through each of these steps, that growth is going to change your payroll and taxes.
Six Stages of Growth in the Dental Industry
Cardillo lists the six stages of dental growth as a solo practitioner, entrepreneurial, foundation development, a platform for growth, organizational evolution, and leadership and vision. He walks readers through the process of what is involved in physically growing your dental practice from a single member practice to 40+. With this growth, effectively marketing your dental practice will be a major key to success.
If you’re running your dental practice on your own, you are technically considered a sole proprietor. The advantages of being a sole prop include easy setup, the ability to run your practice without input from partners or board members, the ability report tax on income earned on your personal tax return, and flexibility. With taxes being a frustrating topic, it’s nice to know that you only have to file once, as opposed to filing both individually and as a business.
Starting a Corporation or Partnership
You may decide that the next step in the growth of your practice is to join forces with one or more other dentists. There are many options, as well as positives and negatives associated with each approach, so it’s important to make your decision carefully. Business legal structures can be changed, but that process can be time-consuming.
How to Pay Your Employees
Through all of the growth, one thing will remain the same: you need to pay your employees. In a dental practice, it’s likely that you are working with a mix of exempt and non-exempt employees.
In short, exempt employees are those who earn a salary and are not eligible for overtime pay; non-exempt employees are paid hourly, must be paid at least minimum wage, and are eligible for overtime pay.
Correctly classifying employees makes a big difference when it comes to processing payroll. It’s also common to have dental hygienists who work as independent contractors, which requires a different approach, as they will receive Form 1099 for tax purposes instead of a W-2.
When it comes to paying your employees, when you use SurePayroll for your dental practice payroll needs, you can pay your employees by units. This allows you to customize payments based on units of your choosing, such as cleanings, visits, and procedures. Having the units option is helpful as a dental practice owner, as you can see all of the services your employees are completing and better understand the work they are doing.
How Online Payroll Can Help During Business Growth
While you’re busy growing your practice, you’re going to have your hands full with all kinds of tasks. The one thing you shouldn’t have to worry about is payroll. At SurePayroll, we make it easy to keep payroll on track, while you focus on other priorities in your business. Easily add employees, update their classification, and know that your taxes are being paid and filed every time*.
If you receive a notice from the IRS, or any other tax agency, based on a filing that SurePayroll made, we’ll work with the agency to help resolve the issue on your behalf. And, if we’re at fault, we’ll pay all the associated penalties and fines.
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This website contains articles posted for informational and educational value. SurePayroll is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, SurePayroll. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant. If you require legal or accounting advice or need other professional assistance, you should always consult your licensed attorney, accountant or other tax professional to discuss your particular facts, circumstances and business needs.