How a Proactive Tax Plan and Fractional CFO Support Delivered Six-Figure Savings for a Denton Dental Practice

Service: Tax Strategy & Legal Compliance, Core CFO Services
Client: Dental Practice | Denton, TX | S-corp | 12 employees | $2.8 million revenue

 

Introduction

Most dentists think tax planning only matters in April. For this 12-person practice in Denton, TX, that approach led to missed opportunities and ongoing frustration. While an outside firm handled accounting and tax preparation, their support was purely transactional. No one looked ahead for tax-saving strategies or flagged potential risks. The office manager did her best to keep things organized, but tax planning was always an afterthought.

The outcome: surprise IRS notices, missed retirement savings, and ongoing financial stress.

When the owner brought in Stratovus as a fractional CFO, everything changed. With a focus on precision, vision, and action, we transformed their approach to taxes, compliance, and cash flow.

 

The Situation: Overpaying and Exposed

The practice, generating $2.8 million in annual revenue and experiencing steady growth, faced several critical issues:

  • No proactive tax planning; estimated payments were based on last year’s numbers.
  • IRS penalties from two years of late or missed estimates, costing thousands.
  • Missed deductions: no accountable plan and no cost segregation for a $320,000 build-out.
  • No retirement plan, even though the business could easily support one.
  • Audit exposure due to lack of a documentation system.

They needed a financial partner who could anticipate problems and implement solutions before issues arose.

 

Our Approach: Precision, Vision, Action

At Stratovus, we do more than just check boxes on compliance and reporting. Our commitment to this dental client started with a hands-on approach built around three key principles:

  • Precision means every detail in your financials is reviewed and verified, from deductions and reimbursements to tax filings, so you’re never caught off guard by the IRS or your own books.

  • Vision is our ability to anticipate what’s ahead for your practice, whether it’s new tax law, opportunities to invest in your team, or financial moves that set you up for growth. It goes beyond traditional forecasting, keeping you one step ahead.

  • Action is what turns strategy into results. If we spot a risk or savings opportunity, we don’t just recommend a change, we make it happen, quickly adapting the plan when new opportunities arise.

With these principles, here’s how we transformed this dental practice’s finances:

Step 1 – Data-Driven Tax Strategy

We reviewed three years of tax returns, built a monthly tax calendar, and set up quarterly profitability reviews.

Step 2 – Ensure Compliance and Eliminate Penalties

We automated estimated tax payments to reflect actual profits.

We also established an accountable plan policy—a formal system for reimbursing employees (including the owner) for legitimate business expenses such as travel, continuing education, or supplies. With an accountable plan, these reimbursements are tax-free and fully deductible for the business, lowering taxable income by $18,400 each year. Without an accountable plan, reimbursements would have been taxed as income or not deducted at all.

To further support compliance, we created a digital audit binder to organize documentation and streamline audit readiness.

Step 3 – Unlock S-corp Savings and Retirement Benefits

Payroll splits were optimized, saving $15,700 in payroll taxes in the first year.

We launched a safe-harbor 401(k) plan so the owner could defer up to $23,000 of income each year, and—through profit sharing—contribute as much as $56,000. A 401(k) provides tax-advantaged savings for the owner and employees, supporting both retirement security and staff retention.

Next, we applied cost segregation to the recent $320,000 build-out. Cost segregation is an IRS-approved strategy that reclassifies certain building and renovation costs into shorter depreciation periods. By accelerating depreciation on $108,000 of the build-out, the practice secured an immediate $22,000 in first-year tax savings.

Step 4 – Ongoing Oversight

We introduced monthly CFO check-ins, regularly updated forecasts, cleaned up the books, and performed annual compliance reviews.

 

Results at a Glance

OutcomeResult
Total Tax Savings$100,000+
IRS Penalties Eliminated$4,200 saved
Payroll Tax Reduction$15,700 (year one)
Accountable Plan Reimbursements$18,400 annually, tax-free
Cost Segregation Savings$22,000 (year one)
401(k) Launched$23,000 deferred; up to $56,000 with profit sharing
Staff RetentionImproved morale and lower turnover
Audit ReadinessDigital binder in place, zero anxiety
Owner Cash FlowConsistent distributions and retirement funds set aside

 

Conclusion

Reactive accounting leads to costly mistakes and unnecessary stress. With hands-on fractional CFO support, this Denton dental practice cut six figures from its tax bill, eliminated penalties, and established long-term financial security, all while maintaining full compliance.

“I used to dread tax season. Now I know where I stand every month and have saved more in taxes than I thought possible. The new retirement plan changed everything for my team and me.”

Dr. Jason L., DDS
Owner
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Dental practice saved $100K+ and eliminated IRS penalties with proactive planning.