Legal Information for new Dentists
Please note that the information provided herein is not legal advice and is provided for informational and educational purposes only. If you need legal advice, you should seek professional assistance, you should contact me (Michael Carabash) or David Mayzel.
So you’ve finally graduated from dentistry school. It’s been a long time coming. Welcome to the wonderful world of business. That’s right. Business. Practicing dentistry is as much a business as it is a profession. You need to come to the realization that you are competing for patients. You need to distinguish yourself. You need to build your brand. You need to provide exceptional services. You are in business.
But what FORM OF BUSINESS are you exactly in? Are you providing services as an employee or independent contractor associate of another dentist? Are you on your own as a general practitioner? Are you in a cost-sharing relationship with other dentists? Are you a partner in a dental partnership? Are you providing services through your corporation? Lets take a look at some of these FORMS of BUSINESS, shall we?
Employee or Independent Contractor Associate
I’ve written quite extensively on the differences between employee associates and independent contractor associates. If you’re new to the game, you’ll likely be provided with an associate agreement that contemplates that you will be an independent contractor. I’ve reviewed MANY of these agreements in the past and here are some things to watch out for:
- Try to ensure that the relationship is IN FACT a truly independent one. If you’re found to be an employee at law, there will be significant tax and termination implications!
- Make sure that the termination provisions (the ways in which you can terminate the agreement) are flexible and fair.
- Make sure that restrictive covenants like non-solicitation clauses are reasonable, clearly-written, and fair to you.
- Make sure that the details of the associate agreement (e.g. the term, remuneration, who pays for what, ownership of dental records) are all addressed.
Be sure to read the many blogs I’ve previously written about this topic of providing dental services as an employee vs. an independent contractor. You can start with this blog and keep reading…
Incorporating your dental practice isn’t for everyone. It’s primarily done for tax purposes. You can defer taxes with the small business tax rate of 15.5%; income split with immediate family; and sell shares of your corporation and pay little or no tax due to the $750,000 lifetime capital gains exemption.
In the next blog, I’ll go a little deeper into the topic of incorporating your dental practice…