Maximize your section 179 benefits!

Section 179: Use dental expenses to deduct taxes

Section 179 of the internal revenue code is an immediate expense deduction designed to help small businesses such as dental practices to purchase depreciable business equipment. This is in contrast to making a capital expense and then depreciating the value of the equipment across future tax years.

With Section 179 of the internal revenue code, dental practices in the United States can deduct up to $1,220,000*. This means you could save up to $2,400 for every $10,000 spent** on qualifying equipment and software purchases.

Read on to see how, with Section 179, you can use dental expenses to deduct taxes.

What purchases qualify under Section 179?

Eligible purchases under the Section 179 provision include:

– Dental equipment. Broadly, dental equipment purchases can include everything from handpieces and motors to autoclaves and imaging systems.

– Technology. Technology purchases can include computers, practice management software, and other systems.

– Office furniture. Any piece of furniture used by the practice can qualify for a Section 179 deduction, including desks, chairs, carts, and cabinets.

– Vehicles. If you offer mobile dentistry services, your vehicle purchase(s) may qualify. One important stipulation is that the vehicle is used at least 50% of the time for business purposes. If the vehicle is an SUV, the maximum expense deduction is $30,500.

Reminder: To qualify for a deduction under Section 179, any equipment that you purchase must be put into service within the same calendar year.

What is the maximum you can deduct under Section 179?

As of 2024, the maximum you can deduct from is $1,220,000, according to the Internal Revenue Service website. Currently, the maximum purchase amount to receive a full Section 179 deduction in a tax year is $3,050,000.

For example, let’s say you purchase $3,250,000 in a given tax year. Since you exceeded the threshold by $200,000, your maximum deduction will also be reduced by $200,000. This also means if your purchases go beyond $4,270,000, these purchases will no longer be eligible for a deduction under Section 179.

Is software considered a “depreciable asset?”

While software is often classified as an intangible asset, it is considered depreciable under US tax code. While software doesn’t “wear out” in the traditional sense, the code recognizes that it does become obsolete over time. Rather than being depreciated in the traditional sense, it is amortized over the lifetime of its anticipated use.

Talk to a CPA to maximize your savings

Utilizing the Section 179 provision is a great way to build your practice. To maximize your savings, we recommend consulting with a certified public accountant (CPA). A CPA can help evaluate your specific financial situation, explain how Section 179 deduction and bonus appreciation can apply to your purchases, and help you structure your purchases to maximize your savings. Your CPA can also help spot any issues such as compliance regulations and phase-out limitations that could hinder your efforts.

* Data accurate as of December 31, 2024.

** Based on tax bracket of 24% and individual savings will vary. Nobel Biocare does not provide tax advice nor guarantees tax deductions/refunds in relation to any product purchased through Nobel Biocare. Consult a tax professional to determine eligibility and restrictions. For more information, visit section179.org.