A $400K S-Corp owner who waits until December 28th to think about taxes typically misses $15,000-$25,000 in deductions. Not because the opportunities don't exist — because the deadlines already passed.
You have 44 days left. Here's what's still possible.
Before you start making strategic moves, take 30 minutes this week to understand your current tax position.
Pull your year-to-date profit and loss statement — even if it's messy. Calculate your estimated taxable income for 2025 and compare it to last year. Are you up or down significantly? Review the estimated tax payments you've made so far. Will you owe more, or are you on track for a refund?
If you're having a higher-income year than expected, accelerating deductions makes sense. If you're down from last year, you might want to defer expenses to maximize their value in a higher-income year.
Block 30 minutes this week to review your numbers — with your bookkeeper if you have one, or pull the reports yourself.
>> Better decisions start with better numbers. Book a quick call today and we’ll help you make sense of where things stand and what to do next.
July's One Big Beautiful Bill Act permanently restored 100% bonus depreciation. You can now write off the entire cost of qualifying equipment in the year you buy it, instead of depreciating it over several years.
What qualifies:
The equipment must be both purchased AND placed in service before December 31st.
Section 179 also increased from $1 million to $2.5 million in immediate deductions. For vehicles over 6,000 pounds, there's a $31,300 Section 179 cap, but you can then apply bonus depreciation to the remaining cost.
A $50,000 equipment purchase saves $12,500 in taxes (25% bracket) or $18,500 (37% bracket). But here's the math that matters: You're spending $50,000 to save $12,500-$18,500. Net cost: $31,500-$37,500.
Only buy if you were planning to buy anyway. Panic purchases to "save on taxes" could cost you real money.
Before you buy, ask yourself:
Make a list of equipment you were planning to buy in early 2026 — could you accelerate those purchases to capture the tax benefit this year?
Smart business owners use the last 44 days of the year to strategically time their expenses and income.
Accelerate expenses into 2025: Prepay up to 12 months of expenses — insurance premiums, rent, professional subscriptions, bookkeeping and tax software. Stock up on office supplies and materials you'll use in Q1. Pay for professional development, conferences, or training scheduled for early 2026. Schedule and pay for needed equipment maintenance or repairs now. Make any planned charitable contributions before year-end.
Defer income into 2026: Delay December invoicing until January 2nd. Push year-end bonuses to the first week of January. Defer consulting income or project completion to early 2026.
>> Important Note: Only defer income if you expect to be in a similar or lower tax bracket in 2026. If you're projecting higher income next year, locking in this year's lower rate makes more sense.
Review your vendor invoices and client billing schedule — what can be strategically timed?
Solo 401(k) accounts must be established by December 31st, even though you can fund them until your tax filing deadline. If you don't have a retirement account set up yet, do it this week. Employee deferrals ($23,500 for 2025, or $31,000 if you're 50+) must also be made by year-end.
Employer contributions can wait until you file your taxes, including extensions. Between employee and employer contributions, you can shelter up to $70,000 ($77,500 if 50+) in 2025.
SEP IRAs offer more flexibility — you can establish and fund them up until your tax filing deadline, making them more forgiving than Solo 401(k)s for last-minute planning.
Your salary-to-distribution ratio directly impacts your QBI deduction. The target for most S-Corps: roughly 40% salary, 60% distributions.
A $300K S-Corp paying 70% salary ($210K) vs. 40% salary ($120K) leaves $18,000 in unnecessary taxes on the table annually. But you can't fix 2025 now — payroll is processed.
What you CAN do: Model your 2026 salary now. If you've been overpaying yourself, adjust January 1st.
For 2025, review your year-end payroll. Ensure you've paid yourself reasonable compensation to avoid IRS scrutiny. Process any final payroll before December 31st.
Under §199A, you can deduct up to 20% of qualified income—but only on profits after salary is paid.
Pay yourself too much salary, and you reduce the profit eligible for the 20% deduction. Pay yourself too little, and the IRS challenges reasonable compensation. Either way, your QBI isn't optimized — potentially costing you thousands annually.
The balance: maximize QBI while staying audit-proof. For high earners approaching SSTB phaseout thresholds, this optimization becomes even more critical.
>> For more information on QBI, read How to Maximize Your QBI Deduction: The Wage Optimization Strategy That Saves $26,000+
Last November, a consulting client came to us projecting $380K in profit. Here's what we found in a 90-minute review:
Total impact: $18,450 in reduced 2025 taxes.
We found these in November. By December 28th, half these opportunities expire.
Common small business tax deductions to review:
Keep receipts. Track mileage. Document the business purpose for meals and travel.
This week (by November 24th):
Thanksgiving week (by December 1st):
December 1-15:
December 16-31:
What's the deadline for Section 179 deductions?
Equipment must be purchased and placed in service by December 31, 2025.
When must Solo 401(k) accounts be established?
By December 31, 2025 to claim 2025 contributions, though funding deadline is your tax filing date.
Can I prepay 2026 expenses to reduce 2025 taxes?
Yes, up to 12 months of qualifying business expenses including insurance, rent, and subscriptions.
How much can prepaying expenses save?
Prepaying $20,000 in 2026 expenses reduces your 2025 tax bill by $5,000-$7,400 depending on your tax bracket.
What if my books aren't current?
You can't implement year-end tax planning strategies if you don't know where you stand. Get your books current first — ideally by November 30th.
November planning beats December panic — but only if your books are current enough to know where you stand.
Last year, we ran a final year-end review for all our clients. We were able to further optimize salaries and ensure every available deduction was in place. Most of them saved thousands The common thread? None of them waited until December 28th.
We're booking year-end strategy sessions. We'll review your financials, identify missed deductions, and model your 2026 tax position. Average savings identified: $13,200.
If your books aren't current, we'll get them there first. Then we'll find the money.
Schedule your session now — December is too late for half these strategies.
Beyond bookkeeping, we are the end to end tax and financial service for founders and solopreneurs. From expense classifications to tax filing and recommendations, we have you covered.
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