Most small business owners think about taxes in April. The business owners who consistently pay less think about taxes in October, November, and December, when they can still do something about it. Once the calendar year closes, your options narrow dramatically.
Review Your Income and Projected Tax Liability
Pull your year-to-date profit and loss statement. Calculate your estimated net income for the full year. If that number is higher than last year, you have time to act. If you do not know what the number is, that is the first thing to fix.
Maximize Retirement Contributions
Contributions to a SEP-IRA can be made up to the tax filing deadline including extensions. Solo 401(k) contributions require the plan to be established before December 31. If you have not maximized your retirement contributions, calculate the maximum allowable contribution now and fund it before year-end. The tax savings are immediate and significant.
Accelerate Deductible Expenses
If you anticipate significant income this year, consider accelerating deductible expenses into the current year: purchasing equipment, prepaying business insurance, stocking supplies, or investing in professional development before December 31. Every dollar of deductible expense reduces your taxable income.
Verify Payroll and 1099 Accuracy
W-2s and 1099-NECs must be issued by January 31. Before the year closes, verify your payroll records are accurate and that you have current addresses and tax identification numbers for every contractor who received $600 or more.
Meet With Your Tax Professional Before Year-End
Not in February. Before December 31. The conversation in October or November is the one that actually changes your outcome. At 360 Global Business LLC, we offer year-end tax planning sessions designed to identify every legal strategy available to you before the books close.
Book your year-end session now. Schedule Here
Shannon C. Williams | CEO, 360 Global Business LLC | 27 Years Federal Tax Educator and Consultant | SDVOSB · WOSB · MBE | U.S. Air Force Veteran | 1-855-500-1514 | (360) 300-4487 | taxes@360globalbusiness.com