Year-End Tax Moves Every Small Business Should Consider
As the year draws to a close, small business owners have an excellent opportunity to optimize their tax position and set the stage for a successful new year. Here are key strategies to consider before December 31:
Purchase Equipment and Supplies: Take advantage of Section 179 deductions or bonus depreciation by purchasing needed equipment or supplies before year-end.
Review Payroll and Bonuses: Ensure all payroll obligations are met. Consider year-end bonuses for employees—these are deductible expenses and boost employee morale.
Defer or Accelerate Income: If you expect higher income next year, defer billing until January. Conversely, accelerate income if your current year’s tax rate is lower.
Check Retirement Contributions: Maximize contributions to employee retirement plans. Contributions to SEP IRAs or 401(k)s can reduce taxable income significantly.
Review Business Deductions: Scrutinize expenses to ensure all business deductions are accounted for, from travel expenses to software subscriptions.
Taking these steps now can reduce your taxable income and put your business on firm footing for 2025. Need help creating a tailored tax strategy? Contact Tax Pros HQ today!
