Pays Less Taxes Before December 31: moves that still lower this year's tax

These moves count for this year only if they happen this year.

• Run S corp payroll for a fair salary, if you haven't yet.
• Make 401(k) deferrals from your paychecks before the last payday.
• Buy equipment you need and get it in use for the business.
• Pay deductible bills you already owe, if your business uses the cash method.
• Repay yourself under an accountable plan for business costs you covered personally.
• Pay family members for the work they did, through payroll.

A few moves can still count for this year after December 31.

• A SEP IRA: opened and funded by your filing deadline, including extensions.
• The employer part of a Solo 401(k): by the business return's due date, including extensions.
• An IRA or an HSA: by the April filing deadline.

Your last estimated payment for 2026 is due January 15, 2027. If profit came in higher than you planned, a larger payment then can keep a penalty off the bill.

You're covered when your payments add up to 90% of this year's tax, or 100% of last year's tax, or 110% of it if last year's adjusted gross income was over $150,000.

You still have the moves that can wait until you file: a SEP IRA, an IRA and an HSA.

Then plan next year from January. That's the easiest month to start an S corp salary, set up a retirement plan and size your estimated payments. If your year runs January to December, an S election for 2027 has to reach the IRS by March 15, 2027.

Is October too late? No. October and November are the best months to plan, because there's time to make every move on the list.

Is it smart to buy a machine only for the write-off? Buy what the business needs. If you were going to buy it in the spring anyway, buying it now moves the deduction into this year.

What if I already made estimated payments? Keep them. We look at what you've paid and what you owe, and set the January payment to match.