As the year comes to a close, the window of opportunity for last minute tax deductions closes as well. If you’re a small business owner, you might be wondering how to minimize the amount you’ll owe Uncle Sam.
The good news? There’s still time to make smart financial moves and take advantage of last-minute tax deductions before December 31st.
In this guide, we’ll walk through actionable strategies to reduce your taxable income, optimize your finances, and prepare your business for tax season.
Whether you’re new to this or a seasoned entrepreneur, don’t leave money on the table!
👉 Grab my FREE guide for even more tax bill tips: jamietrull.com/taxsavings.
Tax Deductions Can Change Your Tax Bracket
Tax deductions reduce the amount of income subject to taxes, which means paying less to the IRS.
Last-minute deductions are strategic expenses you can accelerate or make before December 31st to lower this year’s tax bill.
Timing is everything, so start planning now!
Key Tips for Maximizing End-of-Year Tax Saving Strategies
1. Accelerate Business Expenses
If your business has had a profitable year, accelerating expenses into the current year can reduce your taxable income. This strategy works best for businesses that use the cash basis accounting method.
What You Can Do:
- Prepay for software subscriptions or annual services to lock in lower rates.
- Stock up on necessary supplies or resources for the upcoming year.
Important: Not all purchases qualify for immediate deductions. Items like inventory or large equipment often go on your balance sheet instead of your profit-and-loss statement. Always check with your accountant if you’re unsure.
2. Move Up Employee Expenses
Employee-related expenses like bonuses or payroll can be shifted into the current tax year if paid by December 31st.
Example:
- Instead of running payroll on January 1st, move it to December 31st.
- Pay employee bonuses before the end of the year to claim the deduction now.
This small change in timing can make a big difference when it comes to reducing your current year’s tax bill.
3. Make Charitable Contributions
Giving back isn’t just rewarding—it’s also tax-deductible.
Donations made to qualifying organizations by December 31st can count toward this year’s deductions.
Pro Tip:
Don’t forget to keep receipts and documentation for any contributions.
4. Contribute to Retirement Accounts
Setting up or contributing to retirement accounts for yourself or your employees is another great way to save on taxes while building long-term financial stability.
Timing Matters:
- Some accounts must be opened by December 31st to count for this year’s deductions.
- Contributions to certain accounts (like SEP IRAs) may be made up until you file your taxes.
5. Watch for Black Friday and Year-End Deals
The end of the year is an excellent time to score deals on business tools, software, and equipment. Many companies offer discounted rates during Black Friday and Cyber Monday, so keep an eye on your inbox.
What to Watch For:
- Accounting or payroll software subscriptions.
- Tech equipment upgrades, like computers or printers.
- Online educational programs to upskill your team or yourself.
Bonus Tip: Optimize Your Financial Systems for Next Year
While you’re focusing on deductions, it’s also a great time to ensure your business’s financial systems are ready for 2025.
Set up tools and processes to stay organized year-round and avoid tax season stress.
Start Here:
Watch my video on the three financial systems every small business needs to succeed.
Get My Top Resource for Tax Savings
Want to ensure you’re not missing any valuable deductions?
I’ve created a free tax savings guide packed with practical tips to help you keep more of your hard-earned money.
👉 Download it here: jamietrull.com/taxsavings.
Plan Now to Save Big on Taxes
The clock is ticking! By taking advantage of these strategies, you can reduce your 2024 tax bill and start the new year on solid financial footing.
Don’t wait until it’s too late—make your moves before December 31st and enjoy the benefits of proactive planning.
This transcript is a direct copy from the video and has been formatted for readability. None of the original words have been altered.
Believe it or not, tax season is just around the corner. And if you’re like most small business owners, you’re probably a little worried and wondering how much you’re going to have to fork over to Uncle Sam. Are you sure that you’re not missing out on some valuable deductions that could save you money?
Today, we’re going to talk about just that. I’m sharing some essential last-minute tax deductions that you can take advantage of before the end of the year to reduce this year’s tax bill. Hi everyone, I’m Jamie Trull, your favorite CPA. On this channel, I bring you all the tools you need to stay informed, organized, and profitable in your business finances.
Make sure to like and subscribe and stick around until the end because I’m sharing my top resource for making sure you never miss a tax deduction again.
Start Planning Before It’s Too Late
This video is coming out in November, which is the perfect time to look at what you need to do between now and December 31st. The decisions you make now could significantly affect your tax bill next April. Waiting until January, February, or March to think about taxes? That’s a missed opportunity to lower your tax liability.
Tip 1: Accelerate Business Expenses
If you’ve had a high-profit year and want to lower this year’s taxable income, consider accelerating business expenses. This means moving expenses you’d typically incur next year into this year.
Who Benefits Most?
This strategy is most effective for cash basis taxpayers—those who pay taxes based on when cash moves in or out of the business, not when the transaction is recorded.
What Expenses Can You Accelerate?
- Prepay software subscriptions or annual service fees. Many companies offer discounts for paying upfront, which can also save you money.
- Stock up on essential supplies or services you’ll need next year.
Important Considerations:
This strategy doesn’t work for everything. Items like inventory or equipment often go on your balance sheet instead of your profit-and-loss statement. Double-check with your accountant to ensure your purchases are deductible in the current year.
Tip 2: Move Employee Expenses Forward
Another way to maximize deductions is to move forward payroll or bonuses.
Here’s How:
- Run payroll for January 1st on December 31st instead.
- Issue bonuses to employees before the year ends.
Even shifting expenses by one day can make a difference in your taxable income. Just remember, timing matters!
Tip 3: Contribute to Retirement Accounts
If you or your employees don’t already have a retirement account, now is the time to set one up.
Why It Matters:
- Some retirement accounts must be opened by December 31st to count for this year.
- Contributions to certain accounts, like SEP IRAs, can often be made until the tax filing deadline.
Take advantage of these opportunities to lower your tax bill while planning for the future.
Tip 4: Leverage Black Friday and Year-End Deals
The end of the year is an excellent time to score deals on business essentials. Many companies offer special discounts during Black Friday or Cyber Monday, so it’s a good idea to make a list of what you need and shop strategically.
Look For Deals On:
- Software and tech upgrades.
- Equipment for your business.
- Online courses or educational resources you’ve been eyeing.
But remember, don’t buy something just because it’s on sale—make sure it will provide a return on investment for your business.
Tip 5: Optimize Your Financial Systems
One of the best ways to avoid missed deductions is to have the right financial systems in place. Now is a great time to evaluate your systems and make improvements before the new year begins.
Need ideas? Check out my video on the three financial systems every small business should have.
Get My Free Guide Of Tax Saving Strategies
To ensure you don’t miss any important deductions, grab my free tax savings guide. This resource is packed with actionable tips to help you maximize your savings and keep more of your hard-earned money.
👉 Download it here: jamietrull.com/taxsavings.
Final Thoughts
The end of the year is crunch time for small business owners. By taking advantage of these last-minute strategies, you can reduce your 2024 tax bill and set yourself up for a stronger financial year ahead.
Don’t wait—get started today! And don’t forget to like and subscribe to my channel for more tips to help your business thrive.
