How Uncle Sam Can Help Pay for Your New Smile
We know that comprehensive dentistry of the highest quality requires financial investment. Tax planning for an investment as important as this can certainly be a benefit, both for your oral health and your pocket book. In this example, we assume an adjusted gross income of $65,000 and a 25% tax bracket. For this situation, any dental treatment beyond 7.5% of AGI ($4875) is fully tax-deductible.
If your treatment for implant or cosmetic dentistry is $50,000, then $45,125 is fully tax deductible. By taking this deduction on your tax return, you receive a tax refund of roughly $11, 281.
A home equity loan for the full amount of treatment ($50,000) would have a payment of roughly $430 per month (assuming a 6.15% rate for 15 years). The interest on this loan would be fully tax deductible over the loan's life.
If the tax refund was applied immediately to the loan and the loan was refinanced, the new payment would be approximately $329 with the interest portion of the loan being again tax deductible over its life.
By getting your care done today, not only do you get it done locking in your cost in today's dollars (the average cost for complex dental care increases 5-7% yearly!) but the IRS benefit to you is significant from a tax standpoint. The IRS will literally give you $11, 281 back on your taxes to benefit your health!
Our expertise lies in the practice of exceptional dentistry and not the ins and outs of our nearly 75,000 page tax code, therefore this is merely a suggested method to leverage your dental care expenses to your advantage. We suggest consulting with your tax advisor for the details on your specific circumstances and the benefits that may be afforded to you by taking advantage of comprehensive dental care with "today's dollars."