Business Terminology


Common Business Terms for Dental Practice Owners

Most Commonly Used Business Terms for a Dentist

Associate Dentist

This is typically a non-owner dentist producing at the dental practice. An associate dentist is sometimes a W-2 employee and sometimes an independent contractor.

See IRS Filing Requirements

PLLC

A popular entity for dental practices is PLLC or some variation of it depending on the state. A PLLC typically stands for Professional Limited Liability Company.


Disregarded entity

If a PLLC has not elected to taxed as a different entity like a C-Corp, S-Corp or Partnership, it may be referred to as a disregarded entity.


S-Corp

S-Corp is a tax status that a PLLC can elect to be by filing form 2553 with the IRS.

The question typically is “To be or not to be”. It is highly recommended to consult with your tax CPA to obtain this answer. A paid consultation is always better since you get what you pay for.


Independent Contractors

These are individuals that perform services for the dental practice. They may be dental assistants, dental hygienist, etc. They typically are at the practice replacing a staff member for a short period. They may need to be sent a form 1099.

See IRS Filing Requirements

Vendors

Dental practice can have several vendors providing supplies and services.

See IRS Filing Requirements for Service providing Vendors

Form W-9

This is an IRS form completed by any individual / business who provides a service to your dental practice and is paid via a check/cash/bank tranfer/Zelle/Venmo/Other forms of cash transfers.

Have anyone you pay for services via a check/cash/bank tranfer/Zelle/Venmo/Other forms of cash transfers fill out a form W-9 preferably BEFORE you hire them and for sure BEFORE you pay them. You may need to send contractors a form 1099. You will need these completed W-9s to assess who needs to be sent a Form 1099.

Get Form W-9 from IRS

Form 1099

This is an IRS form issued by businesses to their vendors who they paid for rent, contract labor, repair services, any other type of services or a combination of materials and services and is paid via a check/cash/bank tranfer/Zelle/Venmo/Other forms of cash transfers that total over $600 or over for the year. There are penalties for not filing and for filing them late. You may be required to withhold taxes if the vendor does not provide this information.

You also need to answer on your business tax returns if you needed to file these and if did/will file “ALL” of them.

Typical vendors sent a form 1099: Associate Dentists working as independent contractors, Temp Dental Assistants, Temp Dental Hygienists, Staffing Agencies, Advertising Agencies, Repair Service, Lawn Care. (Think of any service provider at your dental practice.)

See Form W-9

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