7 Tax Planning Moves to Make Before Year-End (That Most Founders Miss)
Kimberly Green | 2026-04-14
7 Tax Planning Moves to Make Before Year-End (That Most Founders Miss) You have until December 31 to cut your 2026 tax bill. Most founders waste this window pretending tax strategy happens in March. It doesn't. The deadline for almost every meaningful tax move is December 31—not April 15. Here are seven concrete moves to make before the ball drops. CPA on Fire walks their clients through every one of these before November ends. 1. Max Out Your Solo 401(k) or SEP-IRA Before December 31 Your deadline is December 31. Not January 15. Not "whenever you file your tax return." For 2026, a Solo 401(k) lets you contribute up to $71,500 as an employee-deferral (or $78,500 if you're 50+). If you're self-employed, you can also contribute as the employer—up to 25% of your net self-employment income on vetted of that. A SEP-IRA is simpler: you can stash up to 25% of your net self-employment income, capped at $71,500. But here's the thing—the money has to be in the account by December 31. Setting up the account by December 31 works. The actual contribution can happen until your tax filing deadline (with an extension, that's October 15). Still, most CPAs push their clients to fund by year-end to avoid confusion. If you made $150,000 in net self-employment income and you're 49 years old, maxing a Solo 401(k) saves you roughly $24,000 in federal taxes alone (37% marginal rate + 15.3% self-employment tax). 2. Review Q4 Estimated Payments—Year-End Tax Strategy to Avoid Penalties If you're a founder, you're probably making estimated quarterly tax payments. The Q4 payment is due December 15. Miss it or get it wrong, and the IRS charges an underpayment penalty. This happens even if you get a refund when you file. One CPA on Fire client paid a $2,100 penalty after missing their Q4 adjustment—completely avoidable. December 15 is your deadline to adjust. If your income is trending higher than you expected, make a bigger Q4 payment. If your income tanked, you might skip it. But you can't wait until January to decide. An income spike of $85,000 in Q3 and Q4 can mean a $2,100+ penalty. A quick December adjustment eliminates it. 3. Accelerate Business Expenses Before December (Year-End Tax Strategy) Here's the strategic part: accelerate deductible expenses only if your 2026 income is higher than you expect 2027 to be. If you're expecting a down year, pull forward business expenses—equipment, contractor invoices, conference registrations, software subscriptions. Deduct them in 2026 when you're in a higher tax bracket. Say you expect $180,000 in income this year but only $100,000 next...
