Dental Practice Purchase Price Allocation Calculator — Illinois (2026)
See how much you could save in taxes each year based on how you allocate your practice purchase price.
When you buy a dental practice, the IRS requires you to split the purchase price across asset categories like goodwill, equipment, and patient records. Each category depreciates on a different schedule — and how you allocate directly determines your annual write-offs. Adjust the sliders below to model different scenarios.
Illinois's 4.95% flat income tax is straightforward for tax planning. Chicago-area practices often have high lease costs, making the leasehold improvements category particularly relevant for allocation.
Purchase Details
Asset Allocation
Drag the sliders or click any value to type a custom amount.
Depreciation Schedule
| Category | Allocated | Deduction/yr | Savings/yr |
|---|---|---|---|
Goodwill | $175,000 | $11,667 | $4,428 |
Covenant | $50,000 | $3,333 | $1,265 |
Equipment | $125,000 | $25,000 | $9,488 |
Leasehold | $50,000 | $3,333 | $1,265 |
Records | $50,000 | $3,333 | $1,265 |
Supplies | $25,000 | $25,000 | $9,488 |
Real Estate | $25,000 | $641 | $243 |
| Total | $500,000 | $72,307 | $27,441 |
Estimated Annual Tax Savings
$27,441/yr
Based on 33% federal + 5.0% Illinois (38.0% combined) marginal rate.
Ready to go from numbers to negotiations?
Minty+ pairs you with an acquisition team that structures the deal, benchmarks the terms, and handles the business after closing — so you can focus on dentistry.
Sources & References
Depreciation periods and allocation guidance are based on the following sources. Consult a tax professional for advice specific to your situation.
IRS & Tax Code
- •IRC §197 — Amortization of Goodwill and Certain Other Intangibles— law.cornell.edu
- •IRC §1060 — Special Allocation Rules for Certain Asset Acquisitions— law.cornell.edu
- •IRC §168 — Accelerated Cost Recovery System (MACRS)— law.cornell.edu
- •IRS Publication 946 — How To Depreciate Property— irs.gov
- •Form 8594 Instructions — Asset Acquisition Statement Under §1060— irs.gov
- •IRS: Intangibles (Section 197 Overview)— irs.gov
Dental Industry
- •ADS Transitions — Tax Consequences of Buying and Selling a Practice— adstransitions.com
- •Dental Buyer Advocates — Asset Allocation in Dental Practice Acquisitions— dentalbuyeradvocates.com
- •PMA Practice Transitions — Understanding the Taxes When Buying a Dental Practice— pmagroup.net
Accounting & Financial
Trade Publications
- •Dental Economics — Consider the Taxes When Negotiating a Practice Sale/Purchase— dentaleconomics.com
- •Dental Economics — Tax Consequences of Buying or Selling a Dental Practice— dentaleconomics.com
Disclaimer: This calculator is for educational purposes only and does not constitute tax, legal, or financial advice. Federal tax brackets reflect projected 2026 rates after TCJA expiration and may change if legislation extends current rates. Equipment depreciation uses the 5-year MACRS default; certain dental equipment may qualify for 7-year recovery. Section 179 expensing or bonus depreciation may allow accelerated write-offs. Always consult a qualified CPA or tax advisor before making purchase allocation decisions.