With 2025 drawing to a close, a prime opportunity for tax liability reduction presents itself to small business owners, as well as the chance to head into a new year in a stronger position financially.
Being proactive with your tax planning as a small business owner isn’t only about paying as little in taxes as possible, but also about making strategic moves that are in line with the goals of your business.
With expert help from professional tax services in Miami, here are 5 tax strategies to consider implementing before the end of the year:
- Section 179 and Bonus Depreciation
You could be rewarded with significant tax deductions if you make savvy equipment purchases before the end of the year, such as business vehicles or computers. Section 179 allows you to deduct as much as $1.22 million in business property that qualifies in 2025, immediately, instead of having to stick to depreciation rules.
Also, for assets that are eligible and which were put into service in 2025, 100% bonus depreciation is still applicable.
- Income deferral and Accelerated Expenses
For those businesses operating on a cash basis, it might be possible to defer income into the following year, and accelerate expenses that are deductible, into 2025. For instance, you might prepay rent expenses, office supplies or utilities now, or hold off on invoicing until January.
- Maximizing of Retirement Contributions
If you haven’t already contributed to a Solo 401(k), a SIMPLE IRA, or a SEP IRA, now might be a good time to consider doing so. Offering significant tax deductions while at the same time, helping you save towards your retirement, these particular plans can be maximized strategically at the end of the year.
- Reviewal of Business Structure
It might be that your existing business structure isn’t as tax-efficient as it once was, particularly if your income has grown in recent months. Exploring entity types with a tax expert at the end of the year could help you better support the financial goals of your business.
- Use of a Tax loss Harvesting Strategy
For a business holding any kind of investment, the end of the year is a great time for evaluating capital gains and losses. To reduce your taxable income, a tax accountant in Coral Gables might recommend that you sell any assets that have been underperforming to offset capital gains, as well as rebalancing your portfolio in time for the new year.
Meeting with a tax professional well in advance of tax season at the end of the year, is strongly recommended, in fact, the earlier the better. A proactive review of your business’s finances can help uncover deductions that may have been overlooked previously, prepare you for tax payments, and keep you compliant with any new tax laws that might have cropped up. So, while implementing the 5 tax-saving strategies above can help you be better prepared and make bigger savings, don’t wait until the last minute to seek professional help. Remember that tax season is the busiest time of year for tax professionals, and they may get booked up well in advance.