December 31 is approaching, and the window for making important tax decisions is closing.
Too many business owners wait until tax season to find out what they owe. By then, many opportunities to reduce their tax liability have passed.
At SBS Accounting & Advisors, we know tax planning is part of a bigger conversation about your company’s financial health. The goal isn’t simply to pay less in taxes. It’s to build a more profitable business and keep more of what you earn.
Here are five decisions worth making before the end of 2026.
- Do you know how much you’ll owe in taxes?
You need a reasonably accurate forecast of your full-year profits and tax liability. If you’ve had a particularly good year, your tax bill may be higher than expected.
Accurate financial statements and regular forecasting are invaluable. You should know approximately where you’ll finish the year, what you’ve paid in estimated taxes, and how much cash you’ll need when the remaining taxes come due.
This sometimes surprises business owners: Just because your business is profitable, that doesn’t necessarily mean it has enough cash in the bank to pay the taxes on those profits.
- Should you make major equipment purchases before year-end?
The return of 100% bonus depreciation under the new tax law makes this especially relevant for 2026. Many qualifying equipment and technology purchases can be fully deducted in the year they’re placed in service, subject to applicable rules. (This is a federal deduction. State deductions may vary.)
But here’s something we regularly emphasize: Don’t spend money just to cut your tax bill.
A $50,000 equipment purchase that saves $15,000 in taxes still costs you a net $35,000. That’s a smart investment if it increases productivity or profitability, but not necessarily if you’re buying primarily for the deduction.
- Are you making the most of retirement plan contributions?
Retirement contributions can reduce taxable income while building long-term wealth.
Depending on your circumstances, a SEP IRA or 401(k) plan may allow meaningful tax-advantaged contributions for you and your employees.
Eligible small businesses establishing retirement plans may also qualify for tax credits to offset startup costs.
Some contribution and plan establishment deadlines extend into the following year, but others don’t. Now is the time to evaluate your options and determine what steps to take.
- Should you accelerate expenses or defer income?
Depending on your accounting method, you may be able to influence the timing of tax deductions and taxable income.
For example, a cash-basis business might benefit from paying legitimate expenses before year-end rather than in January. Properly deferring income into the following year may also make sense.
But reducing this year’s taxable income isn’t always best. If you expect to be in a higher tax bracket next year, shifting income into 2027 could cost you more.
Evaluate both years rather than focusing solely on your 2026 tax bill.
- Are you missing out on tax credits your business has already earned?
Some businesses qualify for valuable tax credits without realizing it. Unlike deductions, which reduce taxable income, credits generally reduce taxes owed dollar for dollar.
Businesses developing products, improving manufacturing processes, or conducting other qualifying research may be eligible for the federal Research and Development (R&D) tax credit. Certain smaller businesses may even apply the credit against payroll taxes.
The Disabled Access Credit may also help eligible small businesses offset qualifying accessibility improvements.
Not every business qualifies, but reviewing your 2026 activities and investments could uncover overlooked tax savings.
The Bottom Line
The best tax strategy isn’t necessarily the one producing the biggest deduction. It’s the one supporting your company’s long-term financial health.
Reducing taxes matters, but so do profitability, adequate cash reserves, and investments that strengthen your business. Good tax planning brings these priorities together.
If you haven’t reviewed your projected 2026 taxes, now is the time. We can help you evaluate your options and develop a plan before year-end.
Contact us at help@sbsaccountants.com or 770-745-4283 to schedule a tax planning consultation.