Tax Rounds - October 2026 Newsletter

What’s new at TaxSmart MD?

With the exception of a few clients who have onboarding in the past couple of months, mid-season planning and projections have been completed!  The focus of the next few months will be on creating more educational content on my website (www.taxsmartmd.com), blog, and outside sources. 

I’ll be attending a couple of conferences in September and October.  The first is the BAPS Charities Healthcare Conference in Atlanta, where I’ll be speaking on financial literacy!  On October, I’ll head to Philadelphia, where I’ll be a sponsor for the inaugural Nonclinical Physicians Network Conference.  If you are in the area and would like to meet, please reach out!

Finally, if you haven’t already, I invite you to follow me on LinkedIn.  I post lots of great (and occasionally mildly entertaining) educational content there, including a Physician Tax Tip of the Day.

What’s New in the Blog:

Note - I started adding trivia questions to the blog posts, which you can read, answer, and use to stump your friends and colleagues if you are interested!

The §469 Grouping Election: If you own your practice’s office building (or other property that is economically tied to your business), this can be a great way to dodge the IRS’ Passive Activity Loss Rules.

Section 105 Medical Reimbursement Plans: The use case is narrow (need to be a sole proprietor with a spouse who legitimately works for the business), but if it applies, it can allow you to deduct qualifying medical expenses (beyond just health/dental insurance).

Don’t Let Your S Corp Take the Wheel:  I think the important educational element of this is that personal use of company property is treated as compensation.  Hello, payroll taxes.

The State Tax Deduction That Most Often Gets Missed: If you have income from US government obligations, this can be excluded from your state’s taxes.  Because this has to be calculated manually, it often gets missed by do-it-yourselfers and high-volume preparers.

The 12-Month Tax Trap:  When a Locums Assignment Stops Being Temporary:  Understanding the IRS’ definition of a “tax home,” “traveling away from home,” and “temporary” work is essential to understanding what travel expenses you can actually deduct.  Fortunately, since most assignments are <12 months, it isn’t that difficult a bar to clear.

First Time Abatement is Changing: The good news about the failure-to-file and failure-to-pay penalties is that they can often be forgiven.  The bad news is that the IRS is strict about the frequency.  This is why it’s almost always better to overpay by April 15th than underpay.

If there are any tax topics you want me to visit in a future blog post, you can reply or email me at logan@taxsmartmd.com.  The purpose of the blog is to educate on topics that matter to YOU!

Other Media Appearances:

Charitable Giving for Physicians:  7 Strategies for 2026 (KevinMD):  I talk a lot in tax planning meetings about how to maximize the benefit of charitable giving.  I summarize the tax benefits here, but that doesn’t really get into the reasons people may choose to give in the first place. I also describe three ways you can maximize the psychological and social benefits.

Outside News and Views:

Do a Roth Conversion at a Discount (White Coat Investor):  I don’t really agree with most of this article, but it’s an interesting perspective.  If you can figure out a way to minimize the value of investments at the time of conversions, it absolutely can save you a boatload of money over your remaining lifetime.

Retirement Account Taxes Distort Physician Net Worth (Kevin MD):  One reason I manage my own investments is that I do my best to calculate the value after expected income taxes and adjust the allocations accordingly.  I know it isn’t going to be accurate, especially since it relies on assumptions of future taxes, but it works better than ignoring taxes completely.

Here’s What It’s Like to Retire to a Low-Tax State (WSJ):  Sorry that I don’t have a gift article link for this.  The gist is that all four of the couples seem happy with their moves, but all four also moved from colder to warmer climates.  So it wasn’t just about the tax savings.  Also, only one couple moved from what I would consider a “high tax” state (Minnesota).

I moved to FL in 2025.  Finances weren’t really a factor in the decision, but now that I’m saving five figures annually in taxes, it would be pretty difficult psychologically to move back to NC.  For me, 80% of the analysis is “how much are you willing to pay for nicer weather?”

Bonus - What tax strategies am I implementing this year?

As a financial nerd pretty much my whole adult life, I’ve grabbed all the low-hanging fruit.  Every retirement account always gets maximized (including after-tax contributions in my Solo 401k).  I deduct ordinary and necessary business expenses, including the per diem amounts for meals.  I deduct $3,000 every year with tax loss harvesting.  Almost all my investment income is taxed at favorable long-term capital gains rates.  Otherwise, my taxes are pretty simple, and I would tell most financially literate people that they could handle this on their own.

I have found a couple of new opportunities for 2026.  One thing I will do is add the auto-enrollment provision to my Solo 401(k) plan.  This will result in a $500 credit per year for three years.  There are a couple of other credits available to small employers, but this one is unique in that you don’t need to have other employees to be eligible.  To my knowledge, the mainstream custodians (i.e. Fidelity, Vanguard, ETrade) don’t have documentation to support this, either.  Message me if you’d like to learn more about these!

Secondly, I formally separated from my old hospital system a few months ago, so I’ll be moving my 401(k) and 403(b) out.  Between now and the end of the year, I will decide how much of this I want to convert to Roth.  As a result, I’ll be fine-tuning my own projection with the same care and detail I give to my clients.

Going in to 2027, I’ll need to decide if it makes sense to make the S Corp election for TaxSmart MD.  I am less likely to benefit than many of my clients because FL does not have a state income tax or Pass-Through Entity Tax.  It really depends on net income, after expenses, and the reasonable compensation I would choose. 

That’s it for October.  I hope you have a wonderful autumn, and stay tuned for the next newsletter in January 2027!