9 Tax Saving Strategies for Optometrists
Are you looking for tax saving strategies for optometrists? This guide has you
covered. Click here to learn more.
9 Tax Saving Strategies for
Optometrists
Are you looking for tax saving strategies for optometrists? This guide has you covered.
Whether you have recently started an optometrist clinic or have been in the business for a long time,
the fear tax season brings is inevitable. Little by little, your business grows to some extent every day.
This can result in shockingly high taxes by the end of the year.
Between running a successful clinic and taking care of customers and employees, overlooking every
expense is nearly impossible. So, to help you minimize tax returns, we have compiled a list of nine tax
saving strategies for optometrists. Keep reading to learn what tax experts and financial advisors have to
say.
- Hire Family Members
If your wife or children are optometrists or know the business, hire them. Hiring family members is one
of the most effective tax saving strategies for optometrists. According to the IRS threshold, if a child’s
income is below a certain limit, they can work tax-free. This will allow you to save on taxes, and you can
use that money for your child’s education.
Furthermore, hiring your spouse can also reduce taxes as the income won’t be subjected to the FUTA
(Federal Unemployment Tax Act) and can double your retirement plan savings. - Track Your Travel Expenses
The optometric industry is all about learning. Therefore, if you and your team are traveling to different
places, cities, or even countries, you can use all those travel receipts to minimize the taxes. These
include your airline tickets and travel by car, ferry, metro, or bus from one place to another.
Moreover, meals and accommodations are also 100% deductible as long as you use them for business
purposes. However, this doesn’t mean that you can get away with disguising a vacation as a business
trip. As a responsible optometrist, you need to have a detailed record of all the travel expenses to claim
the tax benefits provided by the IRS. - Account for Business Loss
Although a sudden loss in a business can be heartbreaking, it can help in saving thousands of dollars on
income and federal taxes. This can save owners more money than just deductions for personal items like
charitable donations and home mortgage interest. So, keep track of your business losses and use them
to reduce your taxes significantly. - Hire a Chartered Accountant
As an optometrist, you might know everything there is to know about eyes. But do you have complete
knowledge of taxes and finances? If not, you might risk overlooking tax deductibles. This is why it is
advised to hire a certified and reputed chartered accountant (CA).
Hiring a CA will make it easier for you to take care of your finances, create cost-saving business
strategies, and save on taxes. The CA will also ensure that you are paying your taxes on time and making
enough profit. - Consider All Expenses
When filing your taxes, make sure to include all your business-related expenses. These include the
internet bill, the rent you pay for the clinic, and purchase receipts for items like clinic furniture,
computers, and equipment. In simpler words, any expense that is related to your business can help in
significantly reducing your taxable income. - Use Software to Track Every Receipt
When it comes to tax saving strategies for optometrists, recordkeeping is the key to success. However,
organizing hundreds of receipts and tracking each of them can be time-consuming and overwhelming,
especially if you don’t like numbers. This is why optometrists should use software to store, organize, and
track receipts.
Using a software system will save you hundreds of dollars and hours of hard work and make it much
easier for you to find proof of expenses during the tax season. If you want to save money, you need to
catch every deductible expense. Thus, invest in a software system that makes recordkeeping easier and
more efficient. - Establish Fringe Benefit Plans for Your Employees
Although increasing salaries is an effective way to retain employees, higher wages mean you will need to
pay higher employment taxes. Therefore, an effective tax saving for optometrists’ strategy is to provide
your employees with fringe benefits rather than a salary raise. You can offer your employees the
following tax-exempt benefits:
● Transportation
● Employee meals
● Medical insurance
● Disability insurance
● Long-term care insurance
● Employee meals
● Tuition reimbursement
● Group term life insurance
● Student loan payment - Deduct Assets to Charity
Another wise tax saving for optometrists’ technique is to donate and deduct as many assets to charity as
possible. When you give an asset to charity, you show your brand value and your loyalty to the
community. So, opt for a charity that resonates with the mission statement of your business and share
valuable information about it with your consumers. This will get you more consumers, create a positive
image, and deduct taxes. - Maximize Your Retirement Contributions
According to renowned financial advisors, selecting the right retirement plan and optimizing it will help
in reducing taxes. Little do people know that the government of the US offers great tax benefits for
employers that invest in employees and saves sufficient money for their own retirement. Thus, by
offering employees reliable retirement opportunities, you will not only be saving on taxes but will be
inspiring loyalty which will lead to your clinic’s success. On the other hand, investing in retirement plans
for yourself, such as the SIMPLE IRA or 401 (k), is also a good way to earn the benefits of tax deductions.
Wrapping It Up!
Tax saving isn’t a one-day job but a year-round activity. One of the most effective tax saving strategies
for optometrists is to regularly review the finances of your organization and implement the above-
mentioned guide accordingly. Practicing these strategies will make you feel confident and help you gain
control over your finances, maximize your profits, and minimize taxes. If you don’t know much about
taxes or tax filing, we recommend hiring a reputed tax-planning expert to help you take care of your
finances.