With the One, Big, Beautiful Bill Act now in effect, your year-end tax planning checklist looks different than it did last year. Several provisions create opportunities that only work if you act before December 31. Here are seven moves every business owner should evaluate.
1. Accelerate Equipment Purchases
With 100% bonus depreciation restored, any qualifying asset placed in service before December 31, 2025 can be fully expensed in year one. If you have been considering equipment, vehicles, or technology upgrades, the tax benefit of buying before year-end is significant. The key is the placed-in-service date: the asset must be delivered and operational, not just ordered.
2. Review Your SALT Deduction Position
The SALT cap increased from $10,000 to $40,000 for taxpayers under $500,000 in AGI. If you are close to the threshold, evaluate strategies to manage your adjusted gross income. Deferring income or accelerating deductions could keep you under the cap and unlock the full benefit.
3. Max Out Retirement Contributions
SECURE 2.0 provisions continue to expand retirement savings options. Solo 401(k) plans, SEP-IRAs, and SIMPLE IRAs all have increased contribution limits. Contributions made by December 31 (or by your filing deadline for SEP-IRAs) reduce your taxable income directly.
4. Evaluate R&D Expenses
If your business incurred research and development costs during 2025, they are now fully deductible rather than amortized over five years. Make sure these expenses are properly categorized in your books. This includes wages for employees performing qualified research, supplies used in R&D, and contract research expenses.
5. Consider Entity Structure
The QBI deduction is now permanent at 23% for pass-through entities. If you operate as a sole proprietorship and your income is growing, evaluate whether an S-Corp election would provide a better overall tax result when combined with the QBI deduction and self-employment tax savings.
6. Harvest Capital Losses
If your investment portfolio includes positions with unrealized losses, selling before year-end lets you offset capital gains. Business owners with significant capital gains from asset sales during 2025 should review their portfolio for harvesting opportunities.
7. Document Everything
The IRS has increased enforcement resources even as it reduced staff in some areas. Strong documentation is your best defense. Ensure mileage logs, meal receipts, home office measurements, and equipment invoices are organized before the year closes. Reconstructing records after the fact is more difficult and less credible in an audit.
The OBBBA created a more favorable tax environment for business owners, but the benefits require proactive planning. Do not wait until April to figure out your strategy when December is the deadline that matters for many of these moves.