Section 179:
What it Means for Your Practice
As dental practices continue to look for ways to better compete, grow and thrive in today’s landscape, many are turning toward technology. Understandably, cost may be one of the key reasons for hesitating to invest in new, advanced equipment. Fortunately, a little-known section of the U.S. tax code offers practices a viable opportunity to lower their tax burden and redirect funds into new advancements that can propel their practice success.
What Is Section 179?
Part of U.S. tax law, Section 179 of the Internal Revenue Code was introduced with the goal of encouraging business owners — including dental practice owners — to invest in equipment and technology. Under Section 179, practices may be able to deduct the full price of qualifying equipment they’ve purchased and put into service during the tax year.
Why should you care?
With Section 179, practice owners have the option of applying the full depreciation for the equipment they’ve purchased and put into use in the first year or disperse it across five years. You could choose to accelerate depreciation and immediately capture the tax benefits in the first year of purchasing the equipment — rather than taking smaller tax deductions over multiple tax years.
What does this mean?
Along with the potential to lower your tax burden for the current year, a Section 179 tax deduction could save you as much as 33% on the cost of capital equipment. That goes a long way toward making it easier to invest in the latest technologies and equipment that provide your practice with a competitive edge.
What else should you know?
For 2023, tax deductions from Section 179 max out at $1,160,000 (with a $2.9 million purchase limit). To qualify for Section 179, equipment must be purchased and put into service before December 31. Other eligibility criteria might apply as well, so be sure to consult with your CPA.
As December 31 quickly approaches, now is the time explore the potential tax advantages of Section 179 that make it easier to invest in advancing your practice. DEXIS is here to help you make the right investment in next-generation technology that will support your patient experience and outcomes, as well as your practice growth. Valued by practices around the world, DEXIS solutions are built on proven technology powered by the latest innovations.
To learn more about Section 179 considerations and tech investments watch a playback of How Technology Can Improve Practice Efficiency and Productivity with Dr. Roger Levin here.
