Summary of What This Blog Covers
- Five year-end tax strategies to reduce your taxable income before December 31.
- How a CPA helps uncover missed deductions and plan smarter.
- Advanced moves like capital gains timing, HSA use, and FBAR compliance.
- Why acting before year-end saves more than waiting until tax season.
How to Outmaneuver the IRS (Legally) and Build a Tax Strategy That Works as Hard as You Do
Let’s set the scene. It’s late December. You’ve just wrapped your best quarter yet. Revenue’s up. Team’s growing. Clients are happy. You finally start to exhale.
And then it hits you.
The tax bill.
You open your profit and loss statement, scan last year’s return, and realize that once again, a good chunk of your hard-earned money is about to go somewhere that feels… less than satisfying.
If you’re nodding along, this is for you.
Because here’s the truth: tax planning isn’t about surviving tax season, it’s about seizing opportunities. Especially when the calendar still says “this year.”
At Insogna CPA, a respected CPA firm in Austin, Texas, we’ve helped thousands of business owners turn December into their most profitable month not by selling more, but by planning smarter.
So grab a coffee. Sit down for ten minutes. Here are the five critical year-end tax strategies that can make or break your bottom line and how to execute each one with precision.
1. Contribute to Retirement Accounts: A Legal, Strategic Tax Shield
Let’s start with the obvious but often overlooked move: retirement contributions.
If you’re a business owner, you’re not just eligible for tax-advantaged retirement accounts, you’re encouraged by the IRS to use them. And when used correctly, these accounts are one of the most powerful tax reduction tools available.
Why It Works:
Contributions to a qualified retirement account reduce your taxable income, lowering both your income tax and potentially your self-employment tax.
That means if you make a $30,000 contribution, your IRS Form 1040 shows $30,000 less in income.
Options That Matter for Business Owners:
- Solo 401(k): For solopreneurs or S Corp owners with no employees (except possibly a spouse). You can contribute both as an employee and employer.
- SEP IRA: A good option for self-employed people with no or few employees. Contribution limit is up to 25% of net income.
- Traditional IRA: Still valid, especially if you’re covered by a workplace plan but fall within income limits.
When You Must Act:
- Solo 401(k): Must be set up by December 31, even if funded next year.
- SEP IRA: Can be opened and funded by the tax filing deadline, including extensions.
- Traditional IRA: Contributions can typically be made by April 15.
How Insogna CPA Helps:
As a small business CPA in Austin, we analyze your current earnings, project your year-end tax exposure, and advise on exact contribution limits to minimize your taxes today and secure your retirement tomorrow.
2. Section 179 Deduction: Buy Now, Deduct Now
You know those office upgrades you’ve been putting off? The new camera setup? The desktop you’ve been limping along with since 2019?
This is your chance.
Section 179 of the IRS Tax Code allows you to deduct the full cost of qualifying business equipment the year you place it in service, rather than depreciating it over several years.
What Qualifies:
- Computers, monitors, laptops
- Business vehicles used over 50% for business
- Office equipment like desks, printers, filing systems
- Software, including cloud-based subscriptions
Example:
You purchase a $10,000 laptop setup on December 20, start using it immediately, and qualify to deduct the full $10,000 from your taxable income this year.
But here’s the catch: it must be in service by December 31.
The Compliance Edge:
Your purchase must meet IRS guidelines especially if you’re claiming a vehicle deduction or splitting business/personal use.
How your Austin tax accountant helps:
We guide you through the eligibility rules, help you document usage properly, and ensure you’re not missing out on full deductions by waiting too long.
3. Run a Year-End Financial Review: Find the Money Before It’s Lost
Tax planning isn’t a mystery. It’s math, timing, and compliance.
And nothing drives clarity like a year-end financial review.
By reviewing your books in December—not in April—you can make strategic decisions about deductions, income deferral, and prepayments that could lower your tax bill by thousands.
What We Look At:
- Have you correctly tracked contractor payments for 1099 reporting?
- Are you taking full advantage of home office deductions, mileage, software costs, and meals?
- Have you reviewed deferred income options (delaying billing into next year)?
- Are you eligible for R&D credits, energy tax incentives, or hiring credits?
The Audit-Proof Factor:
Year-end planning allows you to clean up misclassified expenses, prepare proper supporting documentation, and align your books with IRS expectations.
How your tax preparer near you helps:
At Insogna CPA, we aren’t just filing your return. We’re running diagnostics, catching blind spots, and delivering year-end recommendations tailored to your industry, entity, and income mix.
4. Prepay Expenses: Time Travel for Tax Savings
Let’s talk about a trick even the IRS agrees with: prepaying next year’s expenses in the current year.
If you use the cash accounting method, the IRS lets you deduct business expenses in the year you pay them even if they’re technically for future services.
What You Can Prepay:
- Rent or lease payments
- Business insurance
- Marketing retainers or ad buys
- Software or licensing renewals
- Professional services (yes, you can prepay your Austin accounting service)
Example:
You pay $12,000 upfront in December for next year’s rent. That’s $12,000 off this year’s taxable income even though the space won’t be used until next year.
How your CPA in Austin, Texas helps:
We review your projected Q4 income, recommend how much to prepay based on your cash flow, and verify which prepayments meet IRS rules for cash-basis taxpayers.
5. Work With a CPA Who Actually Builds a Tax Strategy
There’s a huge difference between preparing a tax return and building a tax strategy.
Most business owners get caught in a reactive cycle: file in April, panic in March, forget by May.
But your tax strategy should be just as dynamic and forward-thinking as your business model. And it starts with choosing the right CPA firm in Austin, Texas, not just the nearest tax shop.
What a Great CPA Delivers:
- Entity analysis: Should you be an S Corp? Still a sole prop? What about a multi-member LLC?
- Payroll planning: Are you paying yourself a reasonable salary or triggering red flags?
- Deduction strategies: Are you using mileage vs. actual expenses, home office, or employee fringe benefits?
- FBAR filing: Do you have foreign accounts requiring FinCEN Form 114? We handle that too.
What you do:
Schedule a year-end review. Bring your questions, fears, and financials.
What we do:
Give you clarity, strategy, and confidence in your tax future.
Bonus: Advanced Moves for Growth-Stage Business Owners
If you’re scaling fast or expanding into new ventures, here’s where the tax code gets interesting.
Capital Gains Tax Planning
Have gains from real estate, investments, or crypto?
- Short term capital gains are taxed at your ordinary rate (up to 37%)
- Long term capital gains (held 12+ months) are taxed at 0%, 15%, or 20%
We help you:
- Harvest losses to offset gains
- Defer income to reduce bracket exposure
- Strategically time sales for optimal tax impact
Health Savings Accounts (HSAs)
An HSA is a triple-threat:
- Contributions are tax-deductible
- Funds grow tax-deferred
- Withdrawals are tax-free for medical expenses
FBAR Filing: Get It Done, Get It Right
If your business involves international operations or foreign financial accounts, you may need to file an FBAR (FinCEN Form 114) even if the funds are only temporarily over $10,000.
Miss the deadline? The IRS could slap you with $10,000+ penalties.
As your trusted certified CPA near you, we ensure you comply with all foreign reporting requirements before it becomes a problem.
What Happens If You Wait?
If you delay until January or beyond, you’ll lose out on:
- Contributions to certain retirement plans
- The ability to prepay expenses
- Section 179 deductions
- The chance to time income and reduce tax bracket exposure
- Time to prepare for FBAR compliance if required
Don’t let tax season control you. With the right team, the right timeline, and the right strategy, you’ll control the outcome and the savings.
Final Thoughts: You Work Too Hard to Leave Money on the Table
Your income is growing. Your business is maturing. And it’s time your tax strategy did the same.
At Insogna CPA, we bring proactive, professional, precision-guided tax strategy to business owners across Austin and the U.S. Whether you need help with:
- Retirement contributions
- Capital gains planning
- FBAR filing
- S Corp election
- Payroll optimization
- Or year-end tax moves
We’re your chartered public accountant, tax preparer, and strategic advisor—all in one.
Schedule your year-end tax planning consultation today.
You bring the business, we’ll bring the blueprint to save you thousands.