Key Takeaways
-The average therapist earned $86,961 in take-home income in 2025 on $127,631 in revenue.
-Solo practices held steady with 72% margins, while S Corp margins compressed to 64% as expenses grew faster than revenue.
-Revenue growth slowed. Median income declined for both sole props and S Corps, even as averages ticked up.
"How much should I be earning?" is one of the most common questions therapists ask — and one of the hardest to answer. Salary surveys and job postings don't capture the reality of running your own practice.
That's why we built this report. Using anonymized financial data from Heard customers across all 50 states, we analyzed full-year 2024 and 2025 results to give you real benchmarks for revenue, expenses, and take-home income — broken down by business structure.
Whether you're just starting out, evaluating an S Corp election, or wondering where you stand compared to peers, this data can help you make smarter financial decisions for your practice.
Essential resources:
- Heard's Fee-Setting Calculator
- The Complete Guide to LLCs and PLLCs for Therapists
- Quiz: Is Your Practice Ready for S Corp?
The Big Picture: Therapy Practice Finances in 2025
Across all practices in our dataset, average revenue grew 2.7% year-over-year to $127,631 — a modest but positive trajectory in a year marked by rising operational costs and evolving insurance reimbursement landscapes.
The real story, however, is in the split between sole proprietors and S Corps. These two groups operate at fundamentally different scales, and understanding the differences is crucial whether you're planning your first year or your tenth.
Key takeaway: S Corp practices generate 83% more revenue on average — but their expenses grow even faster, resulting in a lower net margin (64.4% vs. 72.1%). The higher revenue largely reflects larger or group practices with payroll, staffing, and overhead costs that solo practitioners don't carry.
Solo Practice Income: Stability With a Squeeze
For the sole proprietors and 1099s in our dataset, 2025 told a story of stability on the surface — but a subtle decline underneath.
Average revenue ticked up just 0.63% to $98,095, while the median declined 3.3% to $91,178. That divergence between mean and median tells us that high earners at the top pulled the average up, while the typical practitioner saw their revenue slip slightly.
Net income followed a similar pattern: the average rose 0.7% to $70,696, but the median fell 2.2% to $66,084. Expenses stayed essentially flat (+0.4%), which is encouraging — most solo practitioners are keeping costs disciplined even as the cost of doing business rises.
What this means for you: If you're a sole proprietor earning around $91,000 in revenue, you're right at the median — solidly in the middle of the pack. That translates to roughly $5,500 per month in take-home income after expenses. If you're looking to grow beyond this, consider whether increasing session volume, raising rates, or diversifying revenue streams (like group therapy or workshops) makes sense for your practice.
S Corp Practices: Revenue Up, But Expenses Growing Faster
S Corp practices saw stronger top-line growth in 2025, with average revenue climbing 4.7% to $179,003. But the headline number masks a growing pressure point: expenses surged 11.2%, nearly ten times the rate of expense growth among sole proprietors.
As a result, average net income grew just 1.5% to $115,250, and the median net income actually declined 2.6% to $94,307. Net margins compressed from 66.5% to 64.4% — a meaningful shift for practices managing payroll and overhead.
The S Corp tradeoff: S Corp election can provide significant tax savings through the salary/distribution split — but 2025's data shows that the operational complexity and costs of running an S Corp are rising. If you're considering an S Corp election, the general rule of thumb is that it starts making financial sense when your net income consistently exceeds $100,000 per year. Learn more about whether S Corp is right for you.
Where Your Money Goes: The Biggest Practice Expenses
Although business expenses are tax deductible, they still eat into your take-home income. Understanding how other therapists spend their money can help you budget smarter and identify areas where you might be overspending — or under-investing.
Here are the top expense categories impacting therapy practices, including the average amount Heard customers pay annually and monthly:
What this means for you: If your expenses in any of these categories are significantly higher or lower than these benchmarks, it's worth examining why. Are you overspending on office space? Under-investing in marketing? These figures can help you identify opportunities to optimize your spending. If tracking your financials or deductibles feels overwhelming, Heard is here to help.
Key Takeaways for Your Practice
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Take Control of Your Practice Finances
Whether you're earning $50K or $500K, understanding your numbers is the first step to growing your income. Heard provides bookkeeping, tax preparation, and financial tools built specifically for therapists — so you can spend less time on spreadsheets and more time with clients. Learn how Heard can help your practice →