October 15, 2026 • 7 Min Read
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Tell me if this sounds familiar.
You’ve had a business idea rattling around for months. Maybe it’s a course, a consulting gig, a real estate fund, or something AI-related that didn’t even exist two years ago.
The idea part feels exciting. The money part feels like a black box.
Here’s the thing. Medicine isn’t the guaranteed path to financial security it used to be, and more doctors are building something on the side. That’s awesome. But the first year of any business is bumpy, and most of the bumps are financial.
This isn’t a monthly money to-do list. It’s the big-picture checklist to work through before you launch, and to keep coming back to while you do.
Disclaimer: This article is for informational and educational purposes only and does not constitute financial, legal, or investment advice. Any investment involves risk, and you should consult your financial advisor, attorney, or CPA before making any investment decisions. Past performance is not indicative of future results. The author and associated entities disclaim any liability for loss incurred as a result of the use of this material or its content.
1. Tie Every Goal to a Timeline
A goal without a date is just a wish.
Write down what you want this business to do for you. Replace a shift? Fund your kids’ college? Give you the option to go part-time in five years?
Then put a timeline on each one. Short-term goals shape what you do this quarter. Long-term goals shape the bigger decisions, like how much to reinvest and how much to pay yourself.
If you need a starting point, here’s a guide on how to set and course-correct your financial goals.
2. Write a Real Business Plan
Not a napkin sketch. A real one.
- What you’re building and who it’s for
- How you’ll reach those people
- Projected sales and expenses for at least the first year
- How much runway you have before the business needs to pay for itself
- Your exit plan, even if it feels way too early
That last one trips people up. You don’t have to sell the business someday. But knowing what “done” looks like changes how you build it.
A solid plan does double duty, too. It’s the first thing a lender or investor will ask to see.
Not sure where to start? Talking to physicians who’ve already done it saves a ton of guesswork. That’s a big part of what happens inside the LGA community.
3. Register Your Business the Right Way
Make it official before you take a single dollar.
Pick a name that’s unique in your state and choose your entity. An LLC is the most common starting point for physicians. Then get an EIN from the IRS. You’ll use it for taxes, your business bank account, and any licenses.
Next, open a separate business checking account. Mixing personal and business money is one of the fastest ways to make your CPA’s life miserable. Yours too.
One 2026 update: the federal beneficial ownership (BOI) reporting that had everyone scrambling a couple of years ago no longer applies to U.S.-formed companies. FinCEN made that exemption final in August 2026. Some states have their own disclosure rules, though, so double-check yours.
4. Figure Out How You’ll Fund It
Most physician businesses start out self-funded. That’s often the smartest move, because you keep control.
If you need outside money, it’s usually gonna come from loans or investors.
Lenders want your business plan and a clear picture of your personal finances. Physician income helps, but it’s not a blank check. Borrowing isn’t as cheap as it was a few years ago, so run the numbers on what that debt actually costs you every month.
Investors can be friends, family, or angel investors. Just know that every dollar of investor money comes with expectations attached.
Either way, ask yourself this: how long could you keep going if revenue took twice as long as you planned?
5. Get a CPA Before You Need One
Poor accounting sinks a lot of new businesses. Often the idea was fine and nobody knew where the money was going.
Finding a good CPA is one of the best moves you can make as a new business owner. Look for one who works with physicians or small business owners specifically.
Bookkeeping software makes tracking expenses way easier than it used to be, and so do the AI tools built into most of it now. That’s great. It still doesn’t replace someone who knows the tax code and can tell you what you’re missing.
A good CPA should also bring knowledge of tax advantages that will save your business money, like how your entity structure changes what you owe.
6. Watch Your Cash Flow Like a Hawk
Profitable on paper. Broke in the bank account. It happens more than you’d think.
Running out of cash is one of the most common reasons new businesses don’t make it through year one. Revenue comes in late. Expenses come in early. Suddenly you’re covering bills from your personal account.
Check your business account at least weekly, or daily if things are tight.
Keep a cash cushion, ideally a few months of expenses. And know your numbers well enough that a slow month doesn’t catch you off guard.
7. Don’t Let Taxes Sneak Up on You
When you’re an employee, taxes come out of your paycheck. When you own a business, paying them is on you.
Most business owners pay quarterly estimated taxes. For the 2026 tax year, the dates are:
- April 15, 2026
- June 15, 2026
- September 15, 2026
- January 15, 2027
Miss them and you’re looking at penalties.
A few other 2026 changes to ask your CPA about:
- The QBI deduction is now permanent. The One Big Beautiful Bill Act made the 20% pass-through deduction permanent. But health counts as a “specified service” business, so the deduction phases out at higher incomes. For 2026 the phase-out starts around $201,750 for single filers and $403,500 for married filing jointly.
- The 1099-NEC threshold went up. If you pay contractors, the reporting threshold rose from $600 to $2,000 for payments made in 2026.
- Your entity choice matters a lot. LLC or S corp election, salary or distributions. Each choice changes your tax bill.
None of this is tax advice. It’s a list of questions to bring to someone who does this for a living.
If financial freedom is your goal, there’s no better time to get started than right now.
Unlock actionable steps that you can take every day to fine-tune your goals, discover your interests, and avoid costly mistakes on your financial freedom journey.
Start Before You Feel Ready
You don’t need everything figured out on day one.
But the physicians whose businesses last usually handle this stuff early, before it turns into a crisis.
If you want to be in a room with doctors who’ve done exactly this, the Physician Real Estate and Entrepreneurship Conference is a great place to start.
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Were these helpful in any way? Make sure to sign up for the newsletter and join the Passive Income Docs Facebook Group for more physician-tailored content.
Peter Kim, MD is the founder ofPassive Income MD, the creator ofPassive Real Estate Academy, and offers weekly education through his Monday podcast, the Passive Income MD Podcast. Join our community at thePassive Income Doc Facebook Group.
Disclaimer: I am not a CPA, attorney, or financial advisor. The information in this post is for educational purposes only and should not be construed as tax, legal, or financial advice. Please consult a qualified professional about your specific situation before making any decisions.
Further Reading
The 17 Essential Habits of Self-Made Millionaires3 Financial Habits of Physicians Who Retire EarlyThe List of Physician Side Hustles7 Steps To Diversify Your Income Through A Doctor Side HustleTop 5 Reasons to Retire Early
Disclaimer: The topic presented in this article is provided as general information and for educational purposes. It is not a substitute for professional advice. Accordingly, before taking action, consult with your team of professionals.
