As we enter the final quarter of the year, small business owners still have time to make smart tax moves that could lead to meaningful savings. Q4 is your last chance to take action before the books close on the year—and a little planning now can go a long way come tax time.
Here are five practical ways to reduce your tax liability before December 31:
- Make Last-Minute Purchases Do you need new equipment, software, or office supplies? Purchasing them before year-end could qualify you for the Section 179 deduction, allowing you to write off the full cost.
- Defer Income (If It Makes Sense) If your cash flow allows, consider deferring income to January. This could lower your taxable income for the current year—especially helpful if you expect to be in a lower tax bracket next year.
- Contribute to Retirement Accounts Employer contributions to SEP IRAs or Solo 401(k)s are deductible, and they help you and your employees save for the future.
- Review Your Estimated Tax Payments Underpayment penalties can be avoided by making sure your estimated payments align with your actual income. Let’s run a quick check to see if any adjustments are needed.
- Write Off Bad Debts or Obsolete Inventory If you have clients who haven’t paid or inventory that won’t sell, now is the time to recognize those losses and reduce your taxable income.
Don’t wait until December to start tax planning. Let’s wrap up your year the smart way—reach out now to schedule a tax review with the J.A. Green team.
