Starting out in the dental industry, you have a number of choices. The common choice among those graduating dental school is to become a dental associate and eventually move up to own your own practice. To give you some idea salary-wise as to what you’ll be earning, keep reading.
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Compensation as Associate Dentists
When moving into the dental field, you will commonly start out as an associate. This means you will be made an employee or an independent contractor. Starting salaries vary greatly and you will have to investigate different positions to see the possibilities.
Associate Dentist Salaries
An associate’s salary is all over the map, and it depends where you work and who you work for. Some say the salary can be as high as $480,000 a year; others say it ranges between $36,000 and $61,000. Any dentist associate can, after many years of practice, take home higher incomes.
Your Salary as an Associate vs the Dental Owner’s Salary
A dental associate usually earns an average of $125,000 to $146,000 a year. A dentist who owns his own practice makes around $175,000 per year. That is a large enough difference to make you wonder which career path you will choose. However, remember the dental practice owner has many more responsibilities as well as many costs, and overhead.
How It Works
As an employee you may receive an hourly rate or perhaps a flat salary, but more often, your compensation will be based on a percentage of gross revenue. You might get 35% of the production you do, meaning you would get $35 if you produced $100 of dental work on someone. The remainder of the money goes towards upkeep of the practice. If this dental associate wants to earn over $87,000 for a year, he would have to produce $250,000 worth of dental work.
Doing Your Homework via the ADA
When joining a practice, you need to do your homework to find out what compensation will be. You also must look at any contract carefully, preferably getting it reviewed by a contract attorney to make sure everything is as you wish.
Are Dentists Independent Contractors?
Many ask are dentists independent contractors? Dental business owners and dental associates need to know if a dental associate should be considered an independent contractor or an employee. This is important for a number of reasons, particularly due to IRS regulations. The IRS has published rules on what constitutes an employment relationship regarding whether someone is an independent contractor or employee. These factors take into account state and federal considerations that a court would take into account.
IRS Rules Regarding Dentist Associates
Most dentists and hygienists who work for a dental clinic are deemed employees. When the clinic’s owner controls supplies, equipment, scheduling, receipts, hours of operation and staffing, the worker is classified as an employee. These are IRS points when looking at the classification of workers.
How the Dentist Owner Controls His Employees
As stated, when the owner controls many aspects of the business, he is exercising behavioral and financial control. He is controlling what work is taking place and he is directing how it is done. The owner is controlling how the business pays the worker. This is all classified as an employee.
The Exception for Independent Contractors
There are cases when workers can be considered independent contractors by IRS rules. Specialists may practice in a clinic for a limited time and supply their own equipment and staff. They may generate separate billings to patients. Are they offered HR services from the employer? If so, what can the human resources department offer them?
This is very much like a service that does office cleaning. In a service like this, the people work for a number of business owners and they will provide their own equipment, cleaning supplies and cleaners.
It is vital that the contract is reviewed as there are some employers in the industry who would like to avoid paying FICA taxes, which they don’t have to pay when hiring an independent contractor. They also won’t have to have unemployment or workers’ comp insurance. So misrepresenting their employees as independent contractors would be dodging these expenses.
What is the Difference Between Dental Professionals?
Many ask what is the difference between a dentist and an associate dentist? When looking towards your career as a dental independent contractor, you will want to embrace all that it means, including whether to be a dental associate or just embark on the adventure of owning your own dental practice. First you should understand the difference between dental parties. Then you can make informed decisions.
Although there are a number of similarities between dentists and dental associates, there are things you should understand are very different between the two. Dentists commonly owns his or her own practice and hires other dentists to work for him. Dental associates work in a dental practice but do not own the practice. They are hired under contract either as an employee or as an independent contractor. Dental associates have many more restrictions than dentists, they don’t make as much money as the owner (obviously) and they don’t have as much freedom or resources to utilize. But let’s look at the pros and cons of each.
The Pros and Cons of being an Employee
When you work as a dental associate, you only wear your hat as dentists. You provide care to your patients and that is all you have to worry about. You don’t have to manage other employees, or office duties. You have the ability to take extended time off if needed, because the owner or other dental associates are usually in the office to treat patients.
Of course, there are cons. Your schedule may be less flexible as the owner may want you working particular hours or days. You have to play by the owner’s rules and have less flexibility in the materials you use or the time to treat patients. Of course, your financial potential is less. It doesn’t mean that you can’t make it happen to become very successful, but it doesn’t happen for everyone.
The Pros and Cons of Owning your Practice
The Pros are many. When you are a dental professional who owns the practice, you have a large amount of freedom. You can create your team of dental associates under you as well as office staff. When you don’t like something, you can change it. You have a schedule of your own creation. However, on the con side, you have to be many things, not just a dental professional. You have to be a marketer, the boss, and business owner. You have many more financial responsibilities, such as paying the bills, human resources, payroll, and buying equipment.
Dental Contract Attorney
When dental contracts are reviewed by an experienced attorney, you will find great financial benefits which end up outweighing the cost of the contract’s review. If you are in need of assistance with a dental employment agreement or dentistry contract review schedule a Dentist Contract Review with Chelle Law today!