With the recent passage of the One Big Beautiful Bill Act (OBBBA), many dental practice owners and operators are wondering how the changes will impact their business operations, finances, and long-term planning. The new law presents a timely opportunity to reevaluate your 2025 tax strategy. From expanded deductions to enhanced retirement contribution limits, read our latest insight below to learn more about relevant strategies for practice owners to consider before the end of the year.
Maximize deductions before 2026
Leverage the pass-through entity tax for larger deductions
The pass-through entity (PTE) tax continues to be a powerful planning tool for business owners and it's becoming even more valuable in 2025. With the new law temporarily raising the state and local tax (SALT) deduction cap from $10,000 to $40,000 (for those married filing jointly) subject to certain income thresholds, electing to pay state income taxes at the entity level could result in substantial savings. Those married filing separately may deduct up to $20,000.
Accelerate itemized deductions before 2026
Starting in 2026, high-income taxpayers in the top 37% tax bracket will face a 2% cut on their total itemized deductions. That makes 2025 an ideal year for front-loading deductible expenses. To help with this, consider accelerating payments for charitable contributions, mortgage interest, large medical bills, and other itemized deductions. Making these payments before December 31, 2025, could preserve your ability to fully deduct them under current rules.
