Whether you’re just starting out and need a bookkeeper, want someone to take over your monthly payroll and accounting, need help paying bills and collecting invoices, or are ready for strategic growth advice to set KPIs and achieve big goals, Traktion has you covered. We provide the financial expertise of every role without the cost and hassle of building a huge in-house team. Let us support your mental health practice with top-notch financial services, so you can focus on what you do best: helping your clients.
What does an accountant for therapists do differently?
A generalist CPA sees deposits and expenses, while an accountant for therapists sees the practice behind them: sessions per week, your mix of insurance and private pay clients, the gap between what you bill and what a payer actually sends, and the no-show fees that never got collected. We build your books around those numbers so your monthly reports answer the questions you really have, like whether you can afford to leave a panel or bring on your first clinician.
In practice, that means a chart of accounts that keeps insurance revenue separate from private pay, books that are closed and reconciled every month, and a real person who picks up when you have a question. Our bookkeeping for therapists keeps the day-to-day records clean, and our private practice accounting service adds tax planning and reporting on top.
Insurance panels change how your books need to work
When you bill insurance, the amount you charge, the amount the payer allows and the amount that lands in your bank account are three different numbers, and they often show up weeks apart. If your books only record deposits, you lose sight of claims that were denied, underpaid or never paid at all.
We match each insurance deposit back to the sessions it covers using the explanation of benefits (the statement the insurer sends with each payment), so a single batch deposit for twenty sessions doesn’t blur into one line. That gives you reimbursement by payer, which is exactly the number you need when deciding whether a panel is worth staying on or whether it’s time to shift toward private pay. When claims go unpaid, our accounts receivable services can handle the follow-up.
1099 vs W-2 clinicians shape how a group practice runs
Whether a clinician is a contractor (paid on a 1099) or an employee (paid on a W-2) depends on how the working relationship actually operates, not on what the agreement calls it. The IRS looks at three categories of evidence: behavioral control, financial control and the relationship of the parties, and some states apply stricter tests of their own.
The choice shows up everywhere in your books. W-2 clinicians run through payroll with tax withholding, employer payroll taxes and quarterly Form 941 filings. 1099 contractors are paid without withholding, and you file Form 1099-NEC for those who meet the IRS reporting threshold, generally due January 31. Classification is a nuanced legal and tax area, so know the distinction and make the call with your accountant before you hire, not after.
Accounting for therapists has to grow with your group practice
Once you add clinicians, billing staff and an EHR, your books stop being a record of your own income and become a record of a team. Each clinician’s pay model, whether that’s a fee split, a per-session rate or a salary, has to tie back to the sessions in your EHR, and payroll has to run from that data on time every pay period.
We set up reporting by clinician so you can see revenue and margin for each provider, check your contractor agreements against how pay is really being calculated, and build a payroll template that turns your EHR export into payroll in minutes. If you’re weighing another hire, our break-even analysis for hiring another therapist walks through the math.
Is an S-corp right for your private practice?
An S-corp can reduce self-employment tax for some private practice owners, but only once profit is high enough to cover the extra cost and paperwork. As a sole proprietor or single-member LLC, your net profit is subject to self-employment tax, which the IRS sets at 15.3%. With an S-corp election, you pay yourself a reasonable salary through payroll, and profit above that salary can come out as distributions that aren’t subject to self-employment tax.
The trade-offs are real: running payroll, filing a separate business return (Form 1120-S) and setting a salary you can defend. Run your own numbers in our S-Corp Tax Calculator, then read how an S-corp works for therapy group practices before filing Form 2553. Every practice is different, so treat any estimate as the start of a conversation rather than a promise.
This content is for informational purposes only. Tax and financial situations vary. Consult with a professional for advice specific to your practice.
