Q4 Tax Planning Checklist
8 strategic moves to reduce your tax liability before year-end. Potential savings of 15–35% reduction in effective tax rate.
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Potential Savings: 15–35% reduction in effective tax rate. Estimated implementation time: 4–6 weeks for full deployment across all 8 strategies.
Accelerate Deductible Expenses
Time business expenditures to maximise current-year deductions.
- Prepay 2026 business insurance premiums
- Stock up on essential supplies and inventory
- Schedule and pay for major repairs before December 31
- Make planned equipment purchases in Q4
Pro Tip: Credit card charges count as current-year expenses when incurred, for cash-basis taxpayers.
Defer Income Strategically
Push revenue recognition into next year without disrupting operations.
- Delay December invoices until late in the month
- Structure contracts for next-year completion
- Utilise instalment sales for large transactions
- Review accounts receivable for deferral opportunities
Pro Tip: Savings potential: $5,000–$50,000+ depending on revenue size.
Maximise Retirement Contributions
Leverage tax-advantaged retirement plans to reduce taxable income.
- 401(k)/403(b): Employee limit $23,000 — total potential $69,000+
- SIMPLE IRA: Employee limit $16,000 — total $23,000
- SEP IRA: Up to $69,000 for self-employed
- Confirm payroll deadlines to ensure contributions are processed in time
Leverage Section 179 & Bonus Depreciation
Maximise immediate expensing for equipment and vehicles.
- Section 179: Up to $1.22 million in immediate expensing
- Bonus Depreciation: 60% for qualifying property placed in service
- Passenger vehicle limit: $20,900
- Example: $150,000 equipment purchase ≈ $52,500 immediate tax savings
Pro Tip: Must be placed in service (delivered and operational) before December 31.
Optimise Business Structure
Evaluate entity structure for tax efficiency ahead of next filing year.
- S-Corp vs. C-Corp analysis based on retained earnings plans
- QBI (Qualified Business Income) deduction optimisation
- State tax nexus implications of structure changes
- Exit strategy alignment with current entity type
Pro Tip: S-Corp elections for next year must be filed by March 15.
Tax-Efficient Compensation Strategies
Structure executive compensation to minimise tax burden.
- Owner health insurance premiums (deductible above the line)
- Accountable expense plan implementation
- Deferred compensation arrangement review
- Fringe benefit optimisation (vehicle, meals, education)
Pro Tip: Potential savings: $7,500+ per executive annually.
Harvest Tax Losses
Realise investment losses to offset gains and ordinary income.
- Identify underperforming investments in taxable accounts
- Realise up to $3,000 net losses against ordinary income
- Carry forward unused losses to future tax years
- Rebalance portfolio strategically
Pro Tip: Remember: the 30-day wash sale rule applies — do not repurchase substantially identical securities within 30 days.
Charitable Giving Optimisation
Maximise deductions from charitable contributions.
- Bunch multiple years of giving into a single year via Donor Advised Fund
- Donate appreciated securities (avoid capital gains + get full FMV deduction)
- QCD (Qualified Charitable Distribution) if age 70½+ — up to $105,000
- Confirm all donations are to IRS-qualifying 501(c)(3) organisations
Pro Tip: Donor Advised Funds let you take the deduction now and distribute grants over multiple years.
Need help implementing any of these strategies? Book a free CFO advisory consultation before the year-end deadline.