2024 Year-End Tax Planning: The Ultimate Checklist for Badass Small Business Owners
Its time to chat about everyone's favorite topic: year-end tax planning. Okay, maybe it's not your favorite (yet), but stick with me, the results will be worth it.
Look, I get it. You're busy disrupting industries and changing the world. The last thing you want to do is dive into a pile of receipts and tax forms. But here's the truth: nailing your year-end tax planning can be the difference between just running a business and building real wealth.
1. Prep for 1099 Season
The minute the ball drops in the new year, you have 31 days to issue your 1099s (and W2s!). To avoid stress, anxiety, and potential delays here’s what you can be doing right now to set yourself up for success.
Review all the vendors you paid throughout the year (hint: this is super easy if you use quickbooks or a similar software and you add vendor names to each payment!)
Collect a W9 from each vendor so you have all the details you need to fill in their 1099 when the time comes. (Note - you only need to issue a 1099 for any vendor who you paid over $600 via cash, check, or direct fund transfer including zelle/venmo, ect!)
Pro tip: Next year, grab those W-9s before you even think about hitting 'send' on that first payment so you’re never missing 1099s.
Learn more about 1099s first hand from the IRS: https://www.irs.gov/forms-pubs/about-form-1099-misc
2. Payroll & Benefits: Don't Leave Money on the Table
Time to make sure you're not overpaying Uncle Sam (or underpaying yourself):
S-Corp owners, listen up: We're grossing up those health insurance premiums. What this means is that you have to include the health insurance that your business paid on your behalf as part of box 1 wages on your W2. (Confused yet? Use payroll software to help walk you through all of this - reach out for reccomendations!)
Review your compensation (Is it reasonable? Is it enough? Too much?) Striking the perfect balance here can help you minimize payroll taxes, but also remain compliant with the IRS.
Process any year end bonuses well in advance! There are lots of bank holidays at the end of the year and you don’t want those payments delayed.
Double-check those retirement contributions – future you will thank present you.
3. Retirement Planning: Because Margaritas on the Beach Don't Pay for Themselves
Let's set you up for that dream retirement (or early retirement, if that's your vibe):
Evaluate your options: SEP IRA? Solo 401(k)? As a self employed individual you have SO MANY options that will help you both fund your future and save taxes now.
Calculate the maximum you can fund based on your company’s income and your cash flow and plan that contribution.
Consider Roth conversion opportunities (if you are in a low tax bracket, this could be a good year to convert some contributions to Roth to avoid taxes later while taking a smaller hit now!)
PS: Working with a financial planner AND a tax accountant can be hugely beneficial as they each have different areas of expertise. Let them each excel in their areas and then connect them with eachother and you can ALL have a year end planning meeting together.
4. Strategize Your Tax Position
Time to put on your CEO hat and make some power moves:
Book that planning session with your favorite CPA (hint: it's me 😉)
Evaluate your business structure. Is it serving you? Or does the new year call for a change?
Analyze your Profit: What do the projections show the year will finish at? (Hint: Check out PROFITWAY to help analyze your financials)
Strategically plan income and expense timing – because sometimes, you gotta spend money to save money to get those business tax deductions (at the proper time!)
Equipment purchases: Are Section 179 and bonus depreciation the right move for you this year?
Feeling generous? Let's plan those charitable contributions
5. New Year, New Business Energy
Set yourself up to crush it in 2025:
Update your trackers (mileage, home office, etc.) – future you will be so grateful
Review your pricing – are you charging what you're worth? (Spoiler: probably not)
Engagement letters: Not sexy, but necessary. Send 'em out and make sure you are legally protected by outlining expectations
Dream team check: Do you have the staff you need to meet your goals next year?
6. Mark Your Calendar
Miss these dates, and you'll be in a long-distance relationship with the IRS (trust me, you don't want that):
October 15, 2024: Last call for those extended tax returns
October 31, 2024: Q3 payroll taxes due (Form 941)
December 31, 2024: Deadline to set up certain retirement accounts
January 15, 2025: Q4 estimated taxes due
January 31, 2025: W-2 and 1099 distribution deadline
Let's Wrap This Up
Look, I know tax planning isn't as exciting as launching a new product or landing that dream client. But here's the deal: this stuff is the foundation of building real wealth in your business. And isn't that why we're all here?
By knocking out these tasks now, you're setting yourself up for a year of financial clarity, strategic growth, and maybe even a few surprise cocktails on the beach. Because when you know your numbers, you can make power moves in your business and your life.
Remember, building wealth isn't just about making money – it's about keeping it, growing it, and using it to create the life you've always dreamed of. And that, my friend, is what I call winning at business.
Ready to turn your year-end tax planning into a wealth-building strategy session? Let's chat. Book a call with me, and let's make some money moves. 💸
Disclaimer: While this guide provides valuable insights, it's important to note that every business has unique circumstances. For personalized advice tailored to your specific situation, please consult with a qualified tax professional. Our goal at CBFS is to empower you to make informed decisions that support your business growth and personal wealth-building objectives.
Disclaimer: Some of the links in this post may contain affiliate links that will provide compensation.
Disclaimer: AI may have been used to help create, enhance, or review this content. All relevant financial information has been reviewed by a licensed financial professional.
