buying dental practice

Before buying or selling a dental practice, great care and planning should be taken to consider the tax consequences regarding the allocation of the sale price to the various assets involved in the transaction. A CPA with dental expertise will not only provide valuable industry perspective, but also advice on the best tax strategy regarding allocations of the selling practice, best practices from existing clients, expense averages, and a cost analysis on hiring and equipment acquisitions. Buying a Dental Practice: What You Need to Know. One is to borrow from a financial institution, and the other is equity funding, where an investor or consortium of investors inject capital in return for shares in the practice. Use a specialist dental solicitor/accountant, don't be tempted to use a mainstream one for this, it's not a simple sale and purchase agreement. Breaking into the dental field is a big step — but it doesn’t have to be a big headache. 1. Visit our Dental Practice Listings page. Room to expand — Chances are this is your first practice and you are ready to conquer the world. AFTCO is the oldest and largest dental practice transition consulting firm in the United States. Pre-Contract. We encourage you to look into various funding options as soon as possible. Start Buying a Dental Practice the Right Way. After the non-disclosure is returned, the administrative staff at US Dental Transitions will send the buyer the initial practice information, along with contact information for the Transition Advisor for that specific practice listing. While there are several methods used to value practices, the market value (what a buyer is willing to pay) is the most common. Practices usually sell for 70 to 90% of last year’s revenue, while specialty practices may sell for less due to possible volatility with the referral sources for the practice. Buying a dental practice right out of school needs to be given serious thought as many new dentists have student loans or other loans that may need to be considered first. Although your payment may be lower with an adjustable rate, rates will eventually rise, so your best solution is to lock in a strong fixed rate today for the next seven to 15 years. Dental-specific attorney — Since the practice broker will represent the seller, you need to find a reliable source to represent you, the buyer, during the transaction. A longer term is preferable to minimize both the impact on your cash flow and the risk inherent in patient attrition during the first year of your practice. Take it one step further: Hire a consultant who will spend time in the practice to analyze the staff, the systems, and perform a complete chart audit/patient count. We guarantee that we will ask you great questions so you can qualify yourself. Most dentists will first approach their local bank to fund their practice loan, and although this is always an option, local banks are often generalists — and collateral lenders that see little value in the goodwill aspect of the practice. Here's how it works: We gather information about your online activities, such as the searches you conduct on our Sites and the pages you visit. In these cases, before you sign and agree, consult with one of your advisers on the details of such an agreement. Whether you are ready to buy now or just browsing for a dental practice, our transition advisors are happy to discuss your options. Buying a practice; 360° Tours – How much do you value your time? If you prefer that we do not use this information, you may opt out of online behavioral advertising. Although the broker represents the seller, it is his or her job to make sure there’s synergy between the buyer and the seller and that the transition is as seamless as possible. There is a high probability that the proceeds from the sale of your practice will be a significant piece of your upcoming retirement. If you have specific ideas about how much gross or net revenue you’d like the practice to be at before you buy, paying attention to current and future revenue streams will influence your purchasing decision. Dental school only provides you the tools for two-thirds of what it takes to run a successful office. Your up-front due diligence will prove crucial to a successful transition. Your patients may go through some anxiety with losing their trusted dentist, so it’s important to maintain familiar faces and practices in the office. With every transaction, the brokers’ reputation is at stake, which means they’ve vetted their listings, done their own appraisal, and established a fair selling price with the seller. Please note that the information provided herein is not legal advice and is provided for informational and educational purposes only. This instantly allows the buyer (you) to support the practice debt load, including your new loan payment, your salary and your personal expenses. Check out our dental practice buyer’s checklist. It will allow you to place your priorities front … Buy-in — With this type of sale, you would buy in for 25 to 50% and buy the rest of the practice when the seller decides to retire. Take time to understand existing systems and processes before you decide to make changes. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice. If you need legal advice, contact me (Michael Carabash) or David Mayzel. This course is Part II of Mr. Lott's previous Townie Meeting presentation, "Buying a Dental Practice: There is More to It Than Price" This presentation goes into detail on issues in buying or merging a practice, and specific A/R issues as well as other ideas and strategies. Hiring consultants may be a great idea not only during the due diligence period, but also during the post-sale transition. When buying a practice there are many items that need careful and detailed consideration to ensure you have a smooth and successful purchase. Buying a dental practice can be exciting, overwhelming and a bit mystifying. Account to pay off or pay down another bank of America is a involved... Several common factors to help find a practice, we do require an open line communication. Several business models for dental practices, and the knowledge and expertise needed to guide you through this process suggestions. The dentist has the kind of dentistry you want to assume control patient manager, and ’. Post-Sale transition dentist and the more you know about this big investment, the buyer will tour the and... Your business patients, but there are two main methods of raising finance when a! 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