Barbara Schreihans, CEO and Founder of Your Tax Coach.
I’ve found that most business owners don’t start thinking about taxes until December, when their accountant reminds them the year is ending.
By then? It’s often too late to do anything meaningful.
The truth is, most powerful tax-saving strategies require time. That means October could be the perfect window to make moves to save money. Waiting until the holiday season chaos hits usually means that door is shut.
Here are five year-end tax strategies business owners can start now:
1. Setting Up Or Maxing Out Retirement Plans
Retirement accounts aren’t just for retirement; they’re an incredible tax-saving strategy.
Options like a Solo 401(k) or SEP IRA can slash taxable income significantly, but the paperwork and funding deadlines mean owners need to act well before December 31. For example, a traditional 401(k) has to be established by year-end, not next April when filing taxes.
2. Running A Cost Segregation Study On Real Estate
If you’ve purchased or renovated a property this year, a cost segregation study may be able to unlock deductions through accelerated depreciation.
But here’s the catch: These take time.
Engineers and tax professionals typically need weeks (not days) to analyze the property. Starting now ensures business owners can capture the full benefit before year-end instead of leaving money on the table.
3. Hiring Family (The Right Way)
Want to shift income into a lower tax bracket and create generational wealth? Hiring your kids or spouse could be a smart move.
But this tax strategy only works if it’s done properly, meaning documented hours, reasonable wages and payroll systems set up in advance. Waiting until December means owners miss the chance to spread out paychecks and maximize the deduction.
4. Optimizing Charitable Giving
If giving back is on your list, plan ahead so it works for both the cause and your tax bill.
Donor-advised funds, appreciated stock donations or bunching contributions into a single tax year are all strategies that take planning. Because of today’s high standard deduction, just writing a quick check in December often doesn’t move the tax needle.
These strategies require planning because timing, asset choice and deduction limits all matter. Done right, you could maximize tax savings and give more impactfully; done last-minute, you could leave money (and benefits) on the table.
5. Cleaning Up Books And Projections
Here’s the unsexy but essential one: bookkeeping. I promise, you can’t make smart tax decisions if your numbers are a mess.
Getting your books current in October allows your tax advisor to run projections and identify opportunities while there’s still time to act.
If you wait until tax filing season, all you can do is look backward. And I’ve found business owners who treat taxes as an afterthought often end up overpaying.
The ones who save the most on their tax bill? In my experience, they act early, set up well-thought-out strategies and let the savings build wealth for their future. That’s the power of using tax strategies as a business owner.
So while December feels like “tax season” to a lot, I’ve found October is where the real money can be saved. If you start now, your future self (and your bank account) may thank you.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
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