Dental Bookkeeping Mistakes to Watch For

Tax season can be extremely stressful when you’re trying to do all of the bookkeeping work for your dental practice. At Crossroads Tax Advisors, we can take on your tax preparation duties. Are you making these following bookkeeping mistakes at your practice? If you answer yes, it’s time to give us a call.dental accounting

You Accidentally Recorded Transactions From a Previous Period

If you’re not keeping up to date on your books, it makes it a lot easier to make mistakes. At the end of each month, you should be making sure that you’re getting all of your paperwork and things in order. Get financial statements taken care of. Once you have everything set in stone, don’t enter any transactions or make changes to that period.

Entering transactions for the wrong period means your numbers aren’t going to line up with bank statements or your financial reports. If this is something that continues to go unnoticed, everything is going to be off from this point forward. While it may take time to figure out, it can save you from IRS penalties or shelling out money to correct it in the future.

You Don’t Know the Difference Between Cash Flows and Profit

Do you know for sure how to read and actually understand financial reports? If you’re hesitating at all to answer that, you may not be reading them correctly. The profit amount isn’t the cash that you have available on hand. When you’re counting on the profit amount to be your current cash amount, you can be spending more than you have. This leads to more fees, like for overdrafting the account.

Profit is tracked over a certain period of time. It’s your revenue minus expenses for these certain periods. Cash flow is what’s going in and out of your account in a monthly span. It takes into consideration your inventory, accounts receivable, and any depreciation expenses. Knowing the difference is crucial to managing your spending responsibly.

You Aren’t Working With an Experienced Dental Accountant

There are quirks and issues that come up with dental accounting that you don’t see in other industries. It’s important to have someone that’s experienced with dental bookkeeping. The Crossroads Tax Advisors team is built up of people that specialize in accounting for the dental industry.

If you’re attempting to do all the bookkeeping yourself, there’s a large chance that something will get missed. While you may be experienced in dentistry and know the basics, the financial background is beneficial in correctly doing the accounting work for a full business. With an inaccurate accounting system, dentists will notice the high tax bills.

We’re capable of tracking dental-specific tax deductions and can help you save time and money. Our goal is to give you the peace of mind to focus on running the practice, while we worry about the financial details.

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Ready to have an experienced firm take on your tax issues? Call us or request a quote online!