💰WEDNESDAY WISDOM: Q4 Tax Moves to Make NOW 💰
- sarahicenteno27
- Oct 29
- 3 min read
The Bottom Line: Smart tax planning happens BEFORE December 31st. With only two months remaining in 2025, now is the time to implement strategic tax moves that could save you hundreds—or even thousands—when tax season arrives in April.
Why Q4 Tax Planning Matters
Many business owners and individuals wait until tax season to think about their taxes. But here's the truth: by the time January 1st rolls around, most of your tax-saving opportunities for 2025 are gone forever.
The good news? You still have time! Let's explore five strategic moves you can make right now to optimize your tax position before year-end.
1. Maximize Retirement Contributions (401k, IRA)
One of the most powerful tax-saving strategies available is maximizing your retirement contributions. These contributions reduce your taxable income dollar-for-dollar.
💡 2025 Contribution Limits:
401(k): $23,000 (under age 50) or $30,500 (age 50+)
Traditional IRA: $7,000 (under age 50) or $8,000 (age 50+)
SEP IRA: Up to 25% of compensation or $69,000
Action Step: Review your current contributions and increase them if possible. Even bumping up your 401(k) contribution by 1-2% can make a significant difference.
2. Review Estimated Tax Payments
If you're self-employed or have income that isn't subject to withholding, you're required to make quarterly estimated tax payments. Underpaying can result in penalties and interest charges.
Fourth Quarter Payment Deadline: January 15, 2026
📊 What to Review:
Have your income or deductions changed significantly this year?
Did you have unexpected income (investment gains, bonuses, etc.)?
Are you on track to meet the safe harbor rules?
Action Step: Calculate your total 2025 tax liability and ensure you've paid at least 90% of what you'll owe, or 100% of last year's tax liability (110% if your AGI exceeds $150,000).
3. Accelerate Deductible Expenses
If you know you'll have certain deductible expenses in early 2026, consider paying them before December 31st to claim the deduction a year earlier.
✅ Expenses to Consider Accelerating:
Professional dues and subscriptions
Equipment and technology purchases
Office supplies and materials
Professional development and training
Property taxes (if you itemize)
Business insurance premiums
Important Note: This strategy works best if you're using cash-basis accounting and you expect to be in the same or higher tax bracket next year.
4. Defer Income If Possible
The flip side of accelerating expenses is deferring income. If you have control over when you receive income, pushing it into 2026 can reduce your 2025 tax bill.
💼 Income Deferral Strategies:
Delay December invoicing until January
Postpone year-end bonuses to employees (and yourself)
Consider installment sales for large transactions
Time capital gains realization strategically
When This Makes Sense: You expect to be in a lower tax bracket in 2026, or you want to spread income more evenly across years to avoid jumping into a higher bracket.
5. Donate to Charity Before Year-End
Charitable contributions are a powerful way to reduce your tax burden while supporting causes you care about. But the donation must be completed by December 31st to count for 2025.
💝 Smart Giving Strategies:
Cash donations: Deductible up to 60% of AGI
Appreciated assets: Donate stock instead of cash to avoid capital gains tax
Qualified Charitable Distributions (QCDs): If you're 70½ or older, donate directly from your IRA
Bunching donations: Combine multiple years of giving into one year to exceed the standard deduction
Documentation Required: Keep receipts for all donations. For contributions over $250, you'll need a written acknowledgment from the charity.
The Bottom Line: Every Dollar Counts
Each dollar you plan strategically before December 31st could save you hundreds when you file your tax return in April. These aren't loopholes—they're legitimate tax planning strategies that smart business owners and individuals use every year.
⏰ Time is Running Out!
With only two months left in 2025, now is the time to act. Don't wait until December 30th to start thinking about these strategies. The earlier you plan, the more options you have.
Need Help with Your Year-End Tax Strategy?
Sara's Financial Group specializes in proactive tax planning that saves you money. Let's review your situation and identify the best strategies for your specific circumstances.
Contact us today:
📞 (737) 259-4664
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