Start Your Year-End Tax Planning Now
Can you believe it? October already! In less than three months, we’ll be welcoming in 2027.
Ok! Don’t panic yet. There is still time to do some good tax planning. Here are some thoughts to consider.
You now have ¾ of 2026 to look at. How does it compare to the same point in 2025? Do you have some areas that you can do some concentrated planning with?
Do you have a retirement plan? Look at your contributions so far. Can you max them out before December 31st. Look at how many paychecks you have left, divide that into the remaining maximum contributions. Inform your HR to increase your contributions to match that amount. If you own your business, make sure your W-2 earnings are enough to maximize your contribution for the year. (Don’t go above that amount if you have a Sub-S so you can maximize your Qualified Business Deduction.)
Do you have a Capital Loss carryover from 2025? Check with your stockbroker to make sure you harvest enough Capital gains to use up that Capital Loss carryover. Beware of the wash sale rule. Don’t purchase the exact same stock back but get something similar. That’s where your stockbroker can really help in picking the right stocks.
Is your 2026 income looking higher than 2025? If you normally itemize deductions, can you pay extra charitable contributions in 2026? Can you prepay any upcoming major medical costs? Should you pay extra property taxes now instead of waiting until the normal quarterly due dates? Are you getting close to purchasing a new car that you could do before year end? Do you have any business expenses that you could accelerate into 2026? Prepay professional fees. Prepay Insurance coverage. Prepay advertising. Do you need any equipment repaired in the next 6 months that you can have done before the end of 2026?
Think of ways to get your income down before year-end. (It might help get you below thresholds such as the Qualified Business Income phase-out, or the Medicare surtax, or even the new senior deduction phase-out. Do you have some earned income not paid yet? Can you defer it to 2027? Ask your employer if they can hold off paying any expected bonus until early January? If your business bills for services, hold off doing the billings so that some payments will not come in until January 2027.
If your business is planning on purchasing some new equipment in the next 6 months, consider purchasing and placing it in service before the end of 2026. (If you can purchase on credit, can still pay off in 2027, but placing the equipment in service by 2026 opens up the opportunity for bonus depreciation and section 179 expense deductions.
Run an updated tax projection and adjust your upcoming 4th quarter estimated tax payment. (Due January 15th, 2027)
Have you heard? Prov 16:3 says, “Commit your deeds to Yahweh, and your plans shall succeed.”
Kelly Bullis is a Certified Public Accountant in Carson City. Contact him at 775-882-4459. As well as on our website at BullisAndCo.com. You can also find us on LinkedIn and Facebook.
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