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After Dental School

UIC assistant professor receives inaugural ADA award for new investigator in dental informatics

Dr. Emiliya Taneva of the University of Illinois at Chicago College of Dentistry received the first Robert H. Ahlstrom New Investigator Award for Dental Informatics Research.

Dr. Taneva

Dr. Taneva

The award, named after the first chairman of the ADA Standards Committee on Dental Informatics, aims to highlight the crucial role that dental informatics standards play in improving the quality of patient care, assuring patient health and safety and increasing efficiency through use of information technology.

Dr. Taneva, a new dentist and clinical assistant professor at the Department of Orthodontics, received the honor for her paper, “3-D Evaluation of Palatal Rugae for Human Identification Using Digital Study Models.”

Her research documented the palatal rugae as identifiers in a 3-D manner comparable to the use of fingerprints.

“My master’s thesis project involved developing and utilizing a 3-D approach for human verification and identification using the palatal rugae pattern,” she said.

Dr. Taneva said she sees 3-D digital study models obtained with intraoral or model scanners for diagnosis and treatment planning being “integrated in the personal electronic health record, which can be requested and accessed by forensic institutes and law enforcement.”

The implementation of the algorithms, she added, could bring a major impact to the biometrics and forensic odontology fields and create new standards for interoperability and transmissibility, and for acquiring and transferring patient data in open source formats.

Dr. Taneva credits her mentors — Dr. Carla Evans, who heads the Department of Orthodontics; Dr. Andrew Johnson, associate professor of Computer Science; and Grace Vianna, statistician, Depatment of Orthodontics — for the award.

As the recipient of the Ahstrom award, Dr. Taneva will receive airfare and accommodations to present the award-winning project at the ADA SCDI’s annual meeting Nov. 2-4 in Washington, D.C.

Applicants for the award must have received their D.D.S. or D.M.D. degrees no more than five years prior to the time of selection. The awards committee and the ADA Council on Dental Practice will select the winner. For more about the ADA Standards Programs, visit ADA.org/dentalstandards.

So you want to be a practice owner someday: Working with professional advisors

Editor’s note: This is the third article in a summer series of New Dentist Now blog posts on practice ownership. To read other articles from the series, click here.

Whether you’re buying or building a practice, you will need a team of reliable advisors to support and guide you through the process and create the outcomes you envision. You’ll want to surround yourself with people you trust to help meet your goals. Here’s an overview from Wells Fargo Practice Finance, the practice lender endorsed by ADA Business Resources, of the professionals who should make up your core team of advisors, the services they provide, and why they are important.

Wells FargoCORE TEAM OF ADVISORS:

Accountant

  • Develops tax projections, plans, and estimates
  • Prepares and files tax documents
  • Can help establish financial procedures and collections practices
  • Advises on tax and accounting implications of business and investment decisions
  • Impact: Your accountant protects your business by accurately tracking your income, expenditures and cash flow for tax filing purposes, and helping to ensure your business runs efficiently within budget.

Lender

  • Provides funds and resources for opening your practice
  • Services financing agreements
  • May offer useful tools and resources to help manage and grow your new practice
  • Impact: Your lender can make your practice investment possible by structuring a financing program that fits within your budget.

Practice Broker (Acquisition only)

  • Identifies practices available for sale
  • Can offer valuation and appraisal services
  • Works with attorney to provide sample agreement of sale
  • Helps negotiate the transaction, structure the transition, and coordinate financing
  • Impact: A practice broker can save you time and money by presenting qualified purchase options.

Attorney

  • Negotiates and drafts contracts, leases, and employment documents
  • Assists in forming business entity
  • Can provide legal advice on business and tax planning, estate planning and will preparation
  • Impact: Your attorney functions as your advocate, helping to ensure contracts and legal documents are prepared and executed both legally and in your best interest.

Insurance Broker

  • Evaluates existing coverage and recommends most effective protection

Impact: An insurance broker can help preserve your practice value by insuring you against loss.

ADDITIONAL TEAM MEMBERS FOR START-UP

If you’re building a start-up, you’ll need several additional advisors on your team to help manage the project.

General Contractor

  • Builds your facility according to your plans, and to suit your business and personal needs.
  • Recommends structural changes to optimize the practice’s functionality
  • Impact: Your general contractor can help protect your physical assets from structural and environmental damage, and can provide counsel and advice on transforming a new practice location to fulfill your vision.

   Equipment Supplier

  • Measures your selected location to evaluate whether it is suitable for a dental practice
  • Suggests possible office design layouts
  • Works with architect to develop structural drawings and mechanicals.
  • Helps you select and place equipment.
  • Impact: Your equipment supplier can help assure the appropriate selection and integration of equipment and technology in the practice.

Depending on the nature and scope of your project, you may also want to include any or all of these professionals on your practice start-up team:

  • Architect.
  • Interior designer.
  • Lease negotiator.
  • Local practitioner/mentor.
  • Marketing consultant.
  • Project manager. (Click here for more information about the benefits of adding a Project Manager to your team)

Benefits of a Practice Management Consultant

Another specialist who might prove valuable to your practice acquisition or start-up is the Practice Management Consultant. This type of advisor works with you and your team to help ensure your business systems and internal structure are properly positioned for full functionality, profitability and success. The Practice Management Consultant can help minimize the stress of transitioning to a new practice by identifying potential areas of improvement and working with you to develop a plan for change.

It’s neither necessary nor advisable to go it alone when purchasing or building a practice. Start putting together the right professional team for your situation, and you’ll soon find that your new practice is becoming a reality.


So you want to be a practice owner someday: Paths to ownership – Should you acquire or build?

Editor’s note: This is the second article in a summer series of New Dentist Now blog posts on practice ownership. To read other articles from the series, click here.

Congratulations on your decision to become a practice owner! You have many challenges and rewards ahead of you. One of your first tasks is to decide whether to acquire an existing dental practice, or start your own. The ideal choice for you depends on your personality, professional interests and circumstances, and will become increasingly clear as you explore each path to ownership. Below are some of the advantages and disadvantages of a practice acquisition versus start-up, according to Wells Fargo Practice Finance, the practice lender endorsed by ADA Business Resources.

Wells FargoPractice acquisition: Pros and cons

A practice acquisition can be an easier transition for new doctors as systems and cash flow are already in place. In a true turnkey situation, you could potentially start working on patients the same day you obtain the keys to the office. Benefits of acquiring a practice include:

  • Immediate source of production. A beneficial practice acquisition provides an established patient base and income flow, so you can immediately cover loan payments for the purchase while tweaking the details of the practice over time.
  • Ready staff of employees. If you can retain the employees currently in the practice, you will save hours of time in hiring and training hygienists and office staff and have a ready foundation for ongoing operations.
  • Support systems in place. An existing practice will have scheduling, patient tracking, and operational systems in place, saving you time in selecting and installing these types of support mechanisms.
  • Less reliant on marketing. Since you are purchasing a practice that already produces income, you are less dependent on aggressive marketing efforts to generate interest, commitment, and cash flow.
  • Easier loan approval. You may find it’s easier to attain a loan for a practice acquisition than a start-up, as the business has a proven track record upon which the lending company can base its decision.

However, acquisitions can also have their share of problems, which makes it especially important to conduct thorough due diligence. For example, you could inherit troublesome employees who require training or discipline, inefficient procedures or office systems that need to be overhauled, outdated equipment that should be replaced, or a dated facility that needs remodeling. You may also find that the type of dental services provided at the facility are not a true fit for your interests or specialty, requiring you to gradually transition to the offerings and services you prefer. It’s up to you to determine whether it’s worth your time and money to overcome these issues.

Practice start-up: The satisfaction of doing it yourself

Nothing beats the feeling of being in control of your circumstances, and this is the key benefit of the practice start-up:

  • Complete control. With a start-up, you have the ultimate degree of control in creating the professional environment you want.  From the facility itself to equipment, systems and employees, you’re in charge of deciding what works best for you.
  • Creative endeavor. You have a unique opportunity to express your professional and personal taste, unimpeded by dated equipment and facilities or the inheritance of someone else’s problems.
  • Set your own pace. Since you don’t have existing patients to serve, you can set the pace for your transition to ownership, continuing to work as an employee a couple of days a week if necessary while you gradually build your facility and practice.

Of course, start-ups come with their own brand of challenges and risks, such as:

  • Time consuming. Time you could be investing in patient relationships will be spent making numerous decisions about office design, equipment purchases, employee hiring, systems and protocols, and patient outreach. You will need to invest more time in growing the practice than with an acquisition, requiring excellent organizational skills.
  • Marketing-intensive. The success of your start-up will be dependent on your ability to sell your services, and will require a significant degree of planning and marketing skills to establish the business.
  • Location constraints. You will need to choose a location that can demographically support a new dental practice to ensure long-term success. This may limit your practice location options.
  • Loan limitations. Some loan companies may be more reluctant to lend funds for a practice start-up as there is no income history, existing equipment or property to use as collateral. This is particularly true for lenders who are not specialists in professional practice lending.

No matter which path you choose, it’s most important to ensure your choice fits your personal style, situation, and needs. This is the key to attaining professional success, personal satisfaction and enjoyment throughout your business career.

My New Dentist Life: From graduation to South Carolina

Editor’s note: This is the first article in a New Dentist Now blog series, My New Dentist Life, following a new dentist’s first year experiences out of dental school. The views expressed in this article are the personal opinions of the author and are not intended to reflect the views, positions or policies of the ADA or the New Dentist Committee.

Hello!  My name is Emily Hobart and I am a new dentist.

Dr. Emily Hobart at graduation.

Dr. Emily Hobart at graduation.

That felt an awful lot like introducing myself to a group of complete strangers at a self-help meeting. Although in all reality, that is what I am here to do – help!  I have been tasked with updating the masses – curious dental students, fellow new dentists and seasoned dentists alike – on all of the nitty gritty details of what it is like to be a new dentist, fresh out of school, right now. Throughout the year I will share my story. But who knows, I may just end up candidly dishing my embarrassing first-year blunders. I am as interested as you are to see how this all pans out. Either way it should be a lot of fun!

But first, some background.

Deciding where to practice

Like I mentioned, I am a brand new dentist. I just graduated from Midwestern University College of Dental Medicine – Arizona in Glendale, Arizona with the fun-loving Class of 2015.  After surviving D4 year, which felt very much like a circus with all of the hoops that we had to jump through – NDBE Part II, NERB/WREB and all of their components, clinical competencies, and (oh yeah) delivering top notch patient care – here I am!  With all of the busy day-to-day activities of fourth year, focusing on the future was not a priority for me. I found this to be a good thing because for me the future was a blank white canvas. I am unmarried, without children, and my family lives on opposite ends of the continent – I could literally go anywhere and do anything I wanted.  As freeing as that sounds, it was actually pretty scary.

Dr. Hobart and her classmates walking  to graduation to the tune of bagpipes. (photo by Rachel Heinz)

Dr. Hobart and her classmates walking to graduation to the tune of bagpipes. (photo by Rachel Heinz)

A timeline of Dr. Hobart’s journey from her last year of dental school to practicing in South Carolina.

A timeline of Dr. Hobart’s journey from her last year of dental school to practicing in South Carolina.

Having grown up in Glendale, less than 5 minutes from Midwestern, I was ready for a change. But like I said, I had no idea where I wanted to go. Because of this, I took both NERB and WREB since my school offered both. I was one of two students in my class to do so.  I basically wanted the freedom to work in as many places as possible. This meant that I had twice the requirements, twice the cost, and unfortunately, twice the stress!  The anxiety of these exams didn’t come from worry about my abilities – by that point I knew what I was doing – it came from the variables that were out of my control. Will my patient show up?  Will I have enough time to complete the exam with the long grading lines? I suffered through this twice. If you would like my opinion on either exam or how they compared, just ask.

I finished up all of these requirements and moved on to the job search in early April (which I panicked was too late because I had many proactive friends who already found jobs at that point). I narrowed down my focus to the South (How different can you get?), namely South Carolina and Georgia. I soon found out that Georgia would not be a possibility because they only accept the CRDTS exam – which is exactly the same thing as NERB. If I wanted to work there, I would have to retake the exact same exam – find (and possibly pay) patients, fly myself and them to a school in a state that holds that exam and pray that everything works out the first time. Lesson learned: The real world doesn’t always make sense.  But now that I narrowed down which state I wanted to work in, I could start applying for my license.

Getting my license

Dr. Hobart with Dr. Russell Gilpatrick, dean of Midwestern University College of Dental Medicine.

Dr. Hobart with Dr. Russell Gilpatrick, dean of Midwestern University College of Dental Medicine.

Of course, I couldn’t actually apply for my license until the week of my official graduation date when my school would send the states of my choosing a copy of my official transcript.  I applied for a license in Arizona even though I didn’t intend to work there right away because I wanted to have a standing license in a WREB state in addition to a NERB state (South Carolina).  Another lesson learned: This process takes a long time!  (Although it depends on the state and the time of year that you apply.) I applied for both licenses on May 11, Arizona by paper application and South Carolina online. My Arizona license came about two weeks later on May 27. I didn’t get my South Carolina license until July 13 – a full nine weeks later.

How I found my job

Having been an ASDA district trustee last year and involved in the organization for all four years of dental school, I had made connections with recruiters for a lot of group practices by helping to set up sponsored events. I interviewed with several group practices in South Carolina because of this. I also used the ADA Career Center to help me find job openings in the state. I fell in love with Dental Dreams (which I found with the help of this tool), interviewed, and I was offered a job with Family Dental in Columbia, South Carolina, in early May. This process, though daunting, was way easier than I thought it would be.

My start date was supposed to be July 13, but since I got my license on that date, I wasn’t able to start. Once my license arrived, I had to apply for my controlled substances license (required by some states) before I could apply for my DEA license. I also had a stack of new hire and credentialing paperwork to fill out. With any luck, I will start soon.

SouthCarolinaRoad tripping to South Carolina

To get from Arizona to South Carolina, I employed my favorite form of travel – the road trip! My boyfriend and I packed a car full of stuff, and I had my car shipped across the country. Four days on the I-40 was exciting because I saw states that I had never seen before. I even got to stay with my friend Dr. Daryn Lu, former ASDA vice president, in Oklahoma City.

Dr. Hobart did an "escape the room" in Oklahoma City to escape the torrential downpour outside.

Dr. Hobart did an “escape the room” in Oklahoma City to escape the torrential downpour outside.

When I arrived in Columbia, I spent a few days apartment searching. I had done a lot of pre-research, but I needed to see the places for myself. I picked one, but in true real world fashion, it wouldn’t be ready for about a week. I took a “forced vacation” in the meantime, road tripping to Myrtle Beach, Savannah, Charleston and Charlotte. Columbia is thankfully close to so many other cool cities.

Next time: My blog post is about my first week on the job! I promise it won’t be as long as this one!

Dr. Emily Hobart is a New Dentist Now guest blogger and an estranged Canadian who grew up in Glendale, Arizona, where she attended dental school at Midwestern University. She is now finding her way as a new dentist in Columbia, South Carolina. In her free time, she loves running, rock climbing, pub trivia, karaoke and traveling!

New Dentist Conference, ADA annual meeting inspire new dentists, dental students

Westwood, Calif. — While many 2015 dental graduates are busy looking for or settling into practices, one of their fellow graduates is urging both them and dental students to mark some days in early November on their calendars.

Dr. Mendoza

Dr. Mendoza

The New Dentist Conference, which for the first time will coincide with the ADA annual meeting, which takes place in Washington, D.C. from Nov. 5-10. New dentists can participate in both meetings this year and experience all ADA 2015 has to offer, featuring high-level networking opportunities during Leadership Day; a new dentist reception at Penn Social; inspiration from keynote speaker Daymond John, entrepreneur and “Shark Tank” co-star; an exclusive, customized continuing education track featuring real-time interactive technology and more.

Dental students and new dentists alike should make every attempt to attend both events, said Dr. Kristopher Mendoza of the UCLA School of Dentistry Class of 2015.

He should know, considering that he is the immediate past president of the American Student Dental Association and has been an active participant in two past ADA annual meetings.

“It’s a great time to recharge and see what’s beyond dental school,” Dr. Mendoza said.

The 25-year-old dentist, who has just begun a three-year residency in dental anesthesiology at UCLA, said that while the advantages of attending the annual meeting are myriad, one in particular is especially useful for dental students and new dentists.

“One of the greatest benefits for students at the annual meeting is definitely networking with other dentists and students,” Dr. Mendoza said. “Everyone there is extremely helpful, helping the next generation of dentists. They want to see you succeed.”

New Dentist Conference 2015There are several reasons why connecting and interacting with students and more established dentists is important, Dr. Mendoza said. One is that dental students close to graduation and new dentists are seeking jobs, and he has found that some of the established dentists have looked at dentists to join their practices or even sell their practices to.

A second reason is that the ADA annual meeting exposes current and new students to a national community of dentists who provide perspective and inspiration. Attending dental school can place students in a bubble but going to a conference with hundreds of other people who had gone through the experience or were going through the experience invigorated him, he said.

“It was my break,” Dr. Mendoza said. “It helped keep me going. You’re not the only one going through it. It gave me a better outlook on the dental field.” It helped Dr. Mendoza because when he grew up in Fresno, California, he didn’t have any dentists in the family to relate to.

Dr. Mendoza gets asked frequently from younger dentists and dental students if they should join the ADA. “I would challenge them to explore all that being a member offers,” he said. “The value far exceeds the cost.”

Registration for ADA 2015 is open online at ADA.org/meeting.

For a list of courses planned, visit eventscribe.com/ADA/2015.

Search for #ADADC on Twitter and Facebook for more on the ADA annual meeting.

So you want to be a practice owner…someday: Solo or group practice, which is right for you?

Editor’s note: This is the first article in a summer series of New Dentist Now blog posts on practice ownership.

It can take significant introspection to determine whether you’re best suited for a solo practice where you run the show, or a group practice with two or more dentists taking direction from an individual or corporate owner.

Wells FargoIn general, the solo practice may offer more income potential – you do not have to share profits with partners, and you have greater control over your overhead. However, joining a group practice may give you greater stability with a more predictable salary and lifestyle, and more flexibility as work can continue to be performed when you are away from the office.

It’s up to you to determine which type of setting is most likely to fulfill your needs and expectations, as well as fit your personality type and interpersonal style. Take a look at the following list of key characteristics to see which one best describes you from Wells Fargo Practice Finance, the practice lender endorsed by ADA Business Resources.

Solo Practitioner

1)   Entrepreneurial. You crave the freedom to pursue your own clinical interests and are not afraid to work hard and take calculated risks. You look forward to having complete control over your practice and professional life.

2)   Highly organized. You enjoy the business side of dentistry including the administrative responsibilities of hiring and managing staff, selecting insurance, purchasing technology and marketing your practice.

3)   Strong decision maker. You can make tough decisions based on your own best interests and those of your patients, understanding that the ultimate success and growth of your practice is your responsibility.

4)   Visionary. You know where you want to go with your career, and have a good idea of how to get there. You prefer to be in charge of the quality of care, environment, customer service and operation of your practice.

5)   Good negotiator. You’re confident in your abilities to identify and hire professional team members to help you successfully locate, build, design, equip, staff and manage your practice.

Group Practitioner

1)   Team player. You thrive in a collegial setting where you can interact and learn from colleagues and ultimately achieve mentor status. You are comfortable taking direction from a corporate employer or group leader.

2)   Focused. You prefer to focus deeply on your area of expertise, honing your skills in a specific field of dental care, rather than juggling multiple responsibilities and administrative tasks.

3)   Well-balanced. You seek a predictable income and regular work hours in order to achieve stability and a healthy balance between career and family.

4)   Flexible. You can “roll with the punches” and adapt to management or structural changes that may occur in your work setting, such as the number of dentists with whom you will share the workload and the types of treatments you will offer.

5)   Ability to compromise. As in a good marriage, you understand when to push for your own needs and objectives, and when to compromise in order to preserve and grow the relationship.

Working for a period of time in a group setting can be beneficial for the new dentist, as you have the opportunity to learn how a practice is run before taking on this responsibility as a solo practitioner. However, with excellent clinical and organizational skills, you can succeed in a solo practice and enjoy the significant sense of achievement that such an endeavor can provide.


How to reduce stress

It’s no secret to you, or your dental team, that the dental profession comes with the potential for daily stress that can affect your health, as well as your ability to do your job. Stress can occur in various ways throughout your normal workday.  Handling an anxious patient, performing a not-so-familiar procedure or managing the intricacies of health insurance plans to make sure your patients get the treatments they need can all add up to one big stressor by the end of the day.

Work-Life Balance

Work-Life Balance

New dentists have the added stress of running a new business, learning to manage employees and the added burden of dental school loan repayment.

Here are two common stressful scenarios with some tips from the Center for Professional Success on how to handle them:

“What do I do when I get patients that are tense and fearful?”

This is a common concern for new dentists. When you walk into the operatory, you can easily pick up the anxiety from the patient without even realizing it. To stop this from happening, it’s important to observe the patient carefully. If you notice they are anxious, tell them you understand their anxiety and instruct them to take a deep breath along with you and to let their body sink into the chair. The deep breath (or two) will help them relax — and put you at ease as well.

“I work in a multi-operatory situation and I’m so tired at the end of the day. How can I stop from burning out?”

Time demands on dentists can be difficult. Self-care is important to keep yourself in good running order. Watch your diet — be sure to eat breakfast, a mid-afternoon snack, a decent lunch and a healthy dinner. Don’t forget to schedule your lunch hour on your calendar, so you’re sure to take it. Get some rest during the day — pause for a moment between patients, take a deep breath. Then close your eyes and take a second deep breath. Doing this is like pressing the reset button — kind of like taking a one-minute vacation.

ECU dental school’s first graduating class establishes endowment

ECU dental school Class of 2015

ECU dental school Class of 2015

According to the ECU School of Dental Medicine News, the first graduating class of East Carolina University dental school established an endowment to support patient care and student learning.

The endowed gift — the Inaugural Class Patient Care Endowment — received 100 percent participation by the 50 graduates and matching funds from the ECU Medical and Health Sciences Foundation. It currently stands at $33,000.

“The Class of 2015 takes great pride in the palpable impact that the school is already having on North Carolina, and we are inspired by our faculty’s commitment to service. Our dedication to carrying out the school’s mission and fulfilling our class pledge extends beyond our years here. It is with this in mind that we have established the patient fund,” said Dr. Kelly Walsh, class vice president, who co-presented the gift at the school’s convocation on May 8.

To read the full story, click here.

Take action to support student loan reform

2014 Dental Student Loan DebtContact your member of Congress and urge him or her to cosponsor the Student Loan Refinancing Act of 2015, H.R. 649.

The American Dental Education Association estimates that the average graduating dental student’s debt was over $247,000 in 2014.

H.R. 649 will allow borrowers, under the federal student loan program, to refinance their existing loans multiple times. If the current interest rates are below the rate they are paying, they can refinance their loans. This would assist new dentists in reducing their overall debt, thereby opening opportunities to practice in areas of need.

Fill out the form here.

What type of entity should a dentist consider selecting and why?

In my previous blog post, I explained why, as a new dentist you may wish to form a legal entity to run your practice instead of running it as a sole proprietorship. In this article, I’ll explain what type of entity you should consider forming, what tax elections you should consider making when forming that entity, how to actually do it, and how much it will cost.

Rich McIver

Rich McIver

What type of entity you should consider forming

There are a lot of options when selecting what type of legal entity you will operate your practice out of. There is a traditional corporation (denoted by “Inc.”), a professional corporation (“P.C.”), a limited liability company (“LLC”), a professional limited liability company (“PLLC”), a limited partnership (“L.P.”), a general partnership (“G.P.”), a limited liability partnership (“L.L.P.”), and in some states a limited liability limited partnership (“L.L.L.P.”), along with a number of other industry specific entity types.

When you form your entity, you need to select one of these types, each of which operates under a different set of laws and tax rules thus each of which has different advantages and disadvantages. Because of the different laws and tax rules, you are urged to consult with your personal attorney in the state in which you will be practicing before making a final decision on the type of entity to form.  Once you select one you’ll need to append it to the legal name of your practice (e.g. “Dallas Dentistry PLLC”).

Professional Corporation

A Professional Corporation (“P.C.”) is simply a corporation for professionals such as doctors, lawyers or dentists. It operates just like a corporation (“Inc.”) with a few differences that aren’t relevant to this discussion. P.C.s using an S-Corp election (discussed further below) were the original option for dentists who wanted to form an entity. The P.C. with an S-Corp election provided a liability shield, cleaner tax accounting, the ability to distinguish between a dentist’s income and the practice’s profits and thus pay less in Social Security (10.4 percent of self-employment income up to $117,000) and Medicare taxes (2.9 percent of self employment income uncapped) than under a sole proprietorship. Plus a number of other benefits. Unfortunately, because P.C.s are a derivative of corporations (“Inc.”) they also generally require more paperwork, formal annual meetings, and other administrative hassles that traditional corporations require.

Professional Limited Liability Company

Certain administrative and tax burdens associated with a traditional corporation (and thus P.C.s) led states to create a new type of entity, the Limited Liability Company (“LLC”), and in its professional form the PLLC. A professional limited liability company (“PLLC”) is simply an LLC for businesses involving professional services. The benefit of a PLLC is that it generally has less burdensome administrative requirements than a P.C. This lower administrative burden made PLLC’s very attractive for dental practices (except in a few states, most notably California, where LLC’s cannot be used to practice medicine) . The downside of a PLLC relative to a P.C., however, was that a dentist’s Medicare and self-employment tax liability couldn’t be capped at his or her self-employment income, but instead was based on the overall profitability of the practice. This meant that dentists under a PLLC might be paying an extra 2.9-13.3 percent in self-employment taxes.

Professional Limited Liability Company With S-Corp Election

Obviously a combo of these two entity types, the P.C. with its caps on self-employment taxes, and the PLLC with its low administrative hassles, could be advantageous. Thankfully, that is possible with the PLLC with an S-Corp election.

States now almost universally allow PLLC’s to elect to be treated as P.C. or S-Corp’s for tax purposes (again, notably not in California). So, in effect, they are treated as an LLC from a corporate perspective, but when it comes to taxes they’re an S-Corp. This means that a dentist who forms their entity as a PLLC with an S-Corp election gets the benefit of lower administrative legal hassles, with the self-employment tax savings of a corporation. As such, this has become the default answer for many dentists when considering what type of entity to form.  However, as noted above, a dentist would be wise to consult with his or her personal attorney in the state in which he or she will be practicing before making a final decision on the type of entity to form.

How to Form an Entity

Now that you’ve selected the type of entity, you need to decide where to form it. For many dentists, the right answer is usually the state that you will practice in. That’s because if your state is reasonably business friendly, the advantages you can get elsewhere may be outweighed by the convenience and cost savings of not having to hire an out of state agent. But, there are valid reasons for deciding otherwise, so take your time and consider all the factors, perhaps after discussions with your personal attorney. (http://www.nolo.com/legal-encyclopedia/where-form-your-llc.html).

Once you’ve selected a state, actually forming an entity is really easy. For some states you need to first contact your licensing board and get documentation proving you’re a licensed dentist.  Then, just visit your state’s secretary of state’s website (find your state’s here)  to find the forms, download them, complete them and send them in. In many states the application can be completed all online, and in total it’ll take you about 5 minutes. The cost of forming an entity depends on the state, with some as cheap as $45 and others as expensive as $800 (for a state by state cost breakdown read this). You can pay via check, or in some states via credit card online. Note: In a few states, like New York, there is an additional publication requirement to complete formation which can cost up to an additional $1,600.

Once you’ve completed the application, the Secretary of State’s office will review it, and assuming it’s completed correctly, send you a stamped copy in the mail (or increasingly online). With that stamped copy, your entity now formally exists, and you can start doing things like obtaining a bank account, credit card, signing contracts with vendors, etc. all in the company’s name.

In the next article we’ll discuss some of the first vendors and service providers you’ll need to contract with to begin your practice.

For information on ADA legal resources, click here.

Rich McIver is a New Dentist Now guest blogger. He graduated from the University of Notre Dame in 2005 and obtained his law degree at the University of Chicago Law School in 2008. After graduating law school, Rich founded and managed three tech startups that were each acquired through private equity, private sales and a merger, respectively. In 2010, he founded and managed a Houston-based plaintiffs law firm which he sold via a buyout in 2014. In 2013, he and his wife, Holly McIver, an ADA member dentist, founded Kingwood Orthodontics, where he continues to manage back-office operations. His current project is running Merchant Negotiators, a Web startup that reviews credit card processors. Rich provides practical actionable advice for new dentists based on his experience starting and building successful businesses.

Disclaimer: The purpose of this article is to promote awareness of legal and other issues that may affect dentists and dental practices, and is not intended to provide either legal or professional advice. Dentists are urged to consult directly with a properly qualified professional or with an attorney admitted to practice in their jurisdiction for appropriate legal or professional advice.

Rich McIver is a New Dentist Now guest blogger. He graduated from the University of Notre Dame in 2005 and obtained his law degree at the University of Chicago Law School in 2008. After graduating law school, Rich founded and managed three tech startups that were each acquired through private equity, private sales and a merger, respectively. In 2010, he founded and managed a Houston-based plaintiffs law firm which he sold via a buyout in 2014. In 2013, he and his wife, Holly McIver, an ADA member dentist, founded Kingwood Orthodontics, where he continues to manage back-office operations. His current project is running Merchant Negotiators, a Web startup based in Houston. Rich provides practical actionable advice for new dentists based on his experience starting and building successful businesses.