How Dentists Should Prepare for the 2026 Tax Law Changes: What You Need to Know Now
By Maritza Duran | Startup Consultant & Research-Driven Advocate for Dentists
Why This Matters for Dental Practice Owners
Major tax reforms passed in July 2025 are about to reshape both personal and business tax planning starting January 1, 2026. Whether you’re an associate planning to open a practice or an established owner, these changes will affect your bottom line. This article will highlight the most relevant provisions and offer actionable steps to help dentists prepare.
1. Income Tax Rates and Deductions: Lock In Your Planning
- Tax Brackets Stay Lower, But With Nuances: The extension of TCJA brackets (10% to 37%) beyond 2025 provides continuity. However, new inflation adjustments will phase out benefits at higher brackets, particularly for those approaching the 35% and 37% brackets.
- Actionable Tip: Consider income deferral or acceleration strategies in Q4 2025 depending on your anticipated 2026 income level.
2. Big Changes to Deductions Dentists Use
- Standard Deduction Rises Slightly: For married dentists filing jointly, the standard deduction increases to $31,500 (indexed).
- Miscellaneous Itemized Deductions Are Gone for Good: Say goodbye to deductions like unreimbursed business expenses—even for CE, licensing, or uniforms. This change is now permanent.
- Actionable Tip: Move applicable expenses into the practice entity and consult with your CPA to maximize qualified business deductions instead.
3. Section 199A (QBI) Deduction Gets a Boost
- Still Available: Dentists organized as pass-through entities (like S Corps or partnerships) can still benefit.
- Expanded Eligibility: While the Senate bill maintains the 20% deduction, it expands the income threshold and adds a $400 minimum deduction for those earning as little as $1,000 in Qualified Business Income.
- Actionable Tip: Now is the time to re-evaluate your entity structure and salary vs. distribution strategy.
4. Equipment and Buildout Write-Offs Expanded
- Bonus Depreciation Restored to 100%: For large capital expenses (CBCT, chairs, X-ray units), the full expense returns for items placed in service after January 19, 2025.
- Sec. 179 Expensing Cap Rises: Expensing threshold jumps to $2.5M—ideal for startups or offices undergoing expansions.
- Actionable Tip: Time your purchases carefully in late 2025/early 2026 to optimize tax impact.
5. 1099 Reporting and PTET Updates
- 1099 Threshold Increases to $2,000: This reduces the burden of filing 1099s for minor vendor payments.
- No SALT Limit for Pass-Throughs: If you’re in a high-tax state, the elimination of the SALT cap for pass-throughs could reduce your effective tax rate.
- Actionable Tip: Re-evaluate PTET elections with your CPA annually—especially if you own practices across multiple states.
6. What’s Ending: Energy Credits, ERC, Opportunity Zones
- Many clean energy incentives and ERC opportunities are winding down or gone altogether by the end of 2025.
- Actionable Tip: If you’re in the buildout phase, check if your office qualifies for Sec. 179D or energy-efficient construction credits before June 30, 2026.
Conclusion: What Dentists Should Do Next
- Schedule a Q4 tax strategy session with your CPA.
- Run profit projections for 2026 to determine how these changes impact your tax liability.
- Update your bookkeeping and payroll systems for compliance with new thresholds.
💬 “Tax planning isn’t just for year-end—it’s an ongoing strategy. Dentists who plan now will be far better positioned to thrive financially in 2026 and beyond.”
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