Prescription for doctors

Health-care professionals in search of new tax-reduction strategies are increasingly turning to technical service corporations for the solution

Like most of us, doctors and dentists are interested in ways to reduce their tax loads, but they face several challenges when choosing a vehicle designed to achieve that goal. On the one hand, they must take care to comply with the practice standards issued by their professional bodies; on the other, certain business strategies may not work for them because of their particular tax status.

In the 1980s, many physicians and dentists formed management companies (MCs) for tax-reduction purposes. Typically formed to administer the …