In 2015, when the Protecting Americans from Tax Hikes (PATH) Act was passed to stimulate the economy, the R&D Tax Credit became a permanent part of the tax code, expanding eligibility to smaller businesses. This allows the IRS to reward innovative dental companies, dental practices, and dental labs for implementation of improvements to existing techniques incorporating or developing new technology or materials. This credit may not only be applied current year, there is also a look back period of three years, which could offset your income tax liability for ALL included years.
While every dental practice is different, here are two areas that Leyton sees practices benefiting:
1) Incorporating new technology into your business
Many practices are digitally transforming. There is an increased use of advanced technology like 3D cone beam scanners, 3D printers or lasers. In current circumstances, telehealth technology is also being incorporated into practices. While using these products is not R&D in itself, innovating these processes can qualify for the R&D Tax Credit.
2) Procedural process improvements
Dentists are constantly improving the way they deliver products and use materials in order to provide quality care. These process improvements can qualify as R&D activity.
While dentists may be engaging in R&D activities daily, many are unaware of the R&D Tax Credits available to them. To get an in-depth understanding of how the tax credit may apply to your practice, listen to our podcast Dental Implant Tax Credit with Leyton with Dr. Philip Gordon.
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Would you like to know if your dental practice qualifies for the R&D Tax Credit? Leyton's dedicated dental team is comprised of highly experienced doctors, engineers,tax accountants, and attorneys, all of whom are motivated to help your business robustly claim and realize the R&D credit to incentivize further innovation investment. Reach out to our dental team at firstname.lastname@example.org.