Through Reese CPA
Most business owners find out what they owe in March. By then, the year is locked. The moves that reduce your tax bill happen before December 31 — and only if you know your numbers in time to act on them.
The planning window
April is when you file what happened. December is when you still have time to change what happens. The difference between proactive planning and reactive filing is measured in thousands of dollars — not paperwork.
Most tax-reducing moves for business owners require action before the calendar year ends. Retirement contributions, equipment purchases, income timing, and deduction acceleration all have December 31 deadlines. After that, the window closes and you’re left explaining a larger bill than necessary.
The planning window is October and November — when you have accurate year-to-date income, a clear picture of where you’ll land, and enough time to execute before the year ends. By late December, some options are already gone.
The timeline
Year-end moves
Not every move applies to every business. The value is in knowing which ones apply to you — and executing them before the window closes.
Pay deductible expenses before December 31 when beneficial — repairs, supplies, prepaid services, and professional fees. Cash-basis businesses control timing; use it.
Solo 401(k), SEP-IRA, or defined benefit plan elections before the deadline reduce taxable income dollar-for-dollar. Contribution limits are significant — and often underused.
For cash-basis businesses, holding receivables into the next year defers the tax — useful when this year’s income is higher than next year’s will be. Coordinate with your advisor.
Equipment, vehicles, and qualified improvements may be fully deductible in the year of purchase rather than depreciated over years. The rules shift annually — know where you stand.
The 20% qualified business income deduction interacts with W-2 wages, retirement contributions, and income thresholds. Year-end decisions can expand or contract the deduction meaningfully.
Business losses and capital gains in your investment portfolio can offset each other — but only if your CPA and financial advisor are sharing information. This requires coordination, not just filing.
Working with your CPA
Year-end planning only works when your CPA has accurate numbers early enough to act. The businesses that get the most out of planning are the ones that come to their CPA in October or November — not December 28.
Here’s what we need to run a complete year-end review and identify every move available to you.
Year-end planning checklist
Common mistakes
By the time you sit down to file, every planning opportunity for the prior year is gone. The only thing left is calculating what you owe. Good tax work requires a conversation in October or November — not a signature in March.
Business owners often treat their CPA relationship and their investment account as separate. They’re not — realized capital gains, loss harvesting opportunities, and retirement contribution decisions all interact. Without coordination, you leave money on the table.
A CPA who only files returns won’t proactively surface year-end planning opportunities. If you don’t have an explicit planning conversation before year-end, it probably isn’t happening. Proactive planning requires a proactive relationship.
Get started
We start with a 30-minute call to review your year-to-date position, identify which year-end moves apply to your business, and build a plan you can actually execute before the deadline.
Tax services provided through Reese CPA. This page is educational and does not constitute tax advice.