per month doing associate work two days per week or $ 14,000 per month working three days per week . If you worked three days per week for the first three months , then 2 days for the next nine months , you would make about $ 123,000 during the year , which basically covers your shortfall , assuming you don ’ t need any of that for your personal living expenses . If your loan also includes $ 50,000 of working capital , then you also have that as a cushion . As your collections continue to increase to the point where your practice is making enough to replace your associate income , you would eventually be able to leave the associate work completely .
While phasing out of an associate position is a common approach , documenting the actual numbers and estimating when you might be able to cut back from the associate work can help prepare you mentally for the transition and your first year of practice ownership . There might be days when you are wondering if you made the right choice to do a startup , but with the comfort of a written and reasonable cash flow projection , you ’ ll be able to not let emotions win out and know you have a plan in place to weather the cash flow for the first year or so of your startup !
If you started up a new practice after Feb . 15 , 2020 and had employees between July 1 - Dec . 31 , 2021 , make sure you have checked to see if you qualify for the up to $ 100,000 in payroll tax credits as a “ Recovery Startup Business .”
See www . Startup100k . com for more info .
Jeramy is the founder of Jeramy Smith , CPA , PLLC . With over 25 years as a Texas Certified Public Accountant , he has helped hundreds of clients with business strategies and tax-saving strategic planning .
His boutique CPA firm focuses on serving Texas-based dental practices . This narrow market approach allows his team to offer indepth knowledge and reveal little known strategies tailored to specific situations to help practice owners manage their finances and grow their bottom line .
Contact Jeramy at ( 972 ) 836-8296 or visit www . DentalStartupCPA . com
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