Financial leadership for Connecticut clinics caught between two academic systems and one of the densest payer markets in the country

6.99% top individual income tax rate

Connecticut's graduated individual income tax tops out at 6.99% on income over $500K for single filers and $1M for joint filers. Recent legislation reduced the bottom two bracket rates (3% to 2% and 5% to 4.5%) starting in 2024, but the top rate stayed in place. For clinic owners taking S corp or PLLC distributions, the top rate is the one that controls planning.

Source: Tax Foundation: Connecticut

Pass-Through Entity Tax (PTET)

Connecticut originally imposed a mandatory PTET in 2018, then made it elective starting with the 2024 tax year. The PTET allows S corps and partnerships to pay state income tax at the entity level, which restores federal deductibility under the SALT cap. For most clinic owners with meaningful Connecticut-source income, the election is worth modeling each year, since the federal savings depend on your federal marginal rate.

Source: Connecticut Department of Revenue Services

7.5% corporate income tax with 10% surcharge

Connecticut imposes a 7.5% corporate income tax with a 10% surcharge for companies with gross receipts of $100M or more (lower thresholds for smaller companies have varied year to year). Most clinic structures elect S corp or PLLC to avoid the corporate-level tax entirely. The capital base tax was repealed effective 2024.

Certificate of Need (CON) requirements

Connecticut operates an active CON program through the Office of Health Strategy. CON approval is required to establish a new healthcare facility, transfer ownership, terminate services, or acquire imaging equipment over certain cost thresholds. For an outpatient clinic owner planning an ASC, expanded imaging suite, or acquisition, the CON timeline can run 6 to 12 months and must be modeled into any growth plan.

Source: Connecticut Office of Health Strategy

Corporate Practice of Medicine

Connecticut enforces the corporate practice of medicine doctrine through Conn. Gen. Stat. 33-182a et seq. Physicians and dentists must operate through Professional Service Corporations or Professional LLCs, with shares held only by licensed members of the same profession. DSO and MSO structures are common but require careful drafting to comply with state board rules.