Ready for a Lower Tax Bill? Start Your Year-End Planning Now
As we head into the final stretch of the year, now is the time to take a closer look at your tax situation. Whether you're a business owner, investor, or busy professional, there are smart, strategic moves you can make before December 31 to reduce your tax liability and avoid surprises next spring.
At Trail CPA, we believe in proactive planning—and that starts now. Here's a list of key year-end strategies to consider.
For Individuals
- Max Out Retirement Contributions:
401(k) and traditional IRA contributions can reduce your taxable income. Make sure you're on track to hit the limits—and consider catch-up contributions if you're 50 or older.
- Harvest Capital Losses:
If you have investments that lost value this year, selling them before year-end can offset gains and potentially lower your tax bill.
- Make Charitable Contributions:
Donations to qualified nonprofits must be made by December 31 to count for the 2025 tax year. Donating appreciated stock instead of cash may offer extra tax benefits.
- Use Your FSA Funds:
Flexible Spending Account balances may expire at year-end. Schedule that appointment or order supplies before you lose access to those dollars.
For Business Owners
- Accelerate Expenses:
If cash flow allows, consider making equipment purchases, paying bills, or investing in professional services before year-end to increase deductions in 2025.
- Defer Income:
On the flip side, if you’re expecting a large payment or invoice, you may want to hold off until January to defer taxable income.
- Review Your Payroll:
If you're an S corp owner, double-check that you're paying yourself a reasonable salary—and that payroll taxes are on track.
- Make Retirement Contributions:
SEP IRAs and Solo 401(k)s are great tools for reducing income and saving for the future. You may still have until your filing deadline to fund them, but starting now gives you more control.
Now’s the Time to Act
Many of these moves require time to execute—especially if you need to coordinate with payroll providers, investment accounts, or other professionals. The earlier you plan, the more options you’ll have.
Need help making the most of the final months of the year? Our team at Trail CPA is here to support you with personalized planning, clear communication, and strategies designed around your goals.
Schedule a consultation today to talk through your options and wrap up the year with clarity and confidence.