Understanding Section 199 Deductions
The Section 199 deduction, commonly referred to as the Domestic Manufacturing Deduction, was added to the tax code by congress in 2004 with the goal of stimulating U.S. manufacturing. Although it is not common knowledge, orthodontists routinely engage in numerous activities that would qualify for this tax break, such as operating in-house labs to produce retainers, study models, appliances, etc. Therefore, it is important for business owners to understand what types of production activities quality for this deduction and how to claim it correctly during tax season. This will give you a much better appreciation for the true value of any investments you make in new technology for your patients.
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