It’s December. Tax season is coming. And you’re probably wondering: “Is there anything I can still do to reduce my 2024 tax bill?”

The answer: YES. A lot, actually.

The IRS gives business owners powerful tax-saving opportunities—but most of them have a hard deadline of December 31, 2024. Miss it, and you’re paying more than you need to.

Let me show you the moves that can save you thousands before the clock runs out.

1. MAXIMIZE SECTION 179 DEDUCTIONS (Buy Equipment NOW)

What It Is:

Section 179 lets you deduct the FULL cost of qualifying equipment and assets in the year you purchase them—up to $1,220,000 for 2024.

Normal Rules:

Typically, when you buy a $30,000 vehicle, you depreciate it over 5 years ($6,000/year).

Section 179 Rules:

Buy that $30,000 vehicle in 2024, deduct the full $30,000 in 2024.

What Qualifies:

• Vehicles over 6,000 lbs (SUVs, trucks, vans)

• Office furniture

• Computers and technology

• Machinery and equipment

• Software

• Point-of-sale systems

• Security systems

What Doesn’t Qualify:

• Real estate/buildings

• Land

• Inventory for resale

• Personal use items

Requirements:

• Must purchase AND place in service by December 31, 2024

• Must be used more than 50% for business

• Must have taxable income to deduct against

Real Example:

Without Section 179:

• Buy $50,000 in equipment

• Depreciate over 7 years

• Year 1 deduction: ~$7,000

• Tax savings (25% bracket): $1,750

With Section 179:

• Buy $50,000 in equipment

• Deduct full $50,000 in 2024

• Tax savings (25% bracket): $12,500

You just saved $10,750 more in year one.

Action Items:

• Review your equipment needs for 2025

• If you’re buying it anyway, buy before Dec 31, 2024

• Keep receipts and proof of “placed in service” date

• Consult your tax pro about limits based on your income

2. PAY EXPENSES EARLY (Prepay Jan-Mar Expenses in December)

What It Is:

If you’re on cash-basis accounting (most small businesses are), you can deduct expenses in the year you PAY them, not when you incur them.

What You Can Prepay:

• Rent (up to 12 months ahead)

• Insurance premiums

• Professional dues and subscriptions

• Advertising and marketing

• Office supplies

• Website hosting and software subscriptions

• Professional services (accounting, legal)

What You Can’t Prepay:

• Inventory (different rules)

• Capital improvements

• Multi-year contracts (can only deduct current year portion)

Example:

Your January-March 2025 expenses:

• Office rent: $3,000/month × 3 months = $9,000

• Insurance: $2,400/year

• Software subscriptions: $600/quarter

• Total: $12,000

Pay all of this in December 2024 = $12,000 deduction for 2024

Tax savings (25% bracket): $3,000

Strategic Play:

If you’re having a high-income year in 2024 but expect lower income in 2025, prepaying expenses moves deductions to the year you need them most.

Action Items:

• List all recurring business expenses due in Q1 2025

• Pay them before December 31, 2024

• Keep clear records showing payment date

• Mark paid invoices “Prepaid for 2025”

3. MAXIMIZE RETIREMENT CONTRIBUTIONS

Solo 401(k) - The Heavy Hitter:

If you’re self-employed with no employees (except maybe a spouse), Solo 401(k) is your best friend.

2024 Contribution Limits:

• As “employee”: Up to $23,000 ($30,500 if 50+)

• As “employer”: Up to 25% of compensation

• Total max: $69,000 ($76,500 if 50+)

Example:

You’re 45, made $100,000 net profit in 2024:

• Employee contribution: $23,000

• Employer contribution: $25,000 (25% of $100K)

• Total: $48,000 deducted from 2024 taxes

Tax savings (25% bracket): $12,000

Deadline:

• Employee contributions: Must be deposited by December 31, 2024

• Employer contributions: Can be made until tax filing deadline (April 15 or October 15 with extension)

SEP-IRA - The Simple Option:

Less powerful, but easier to set up if you’re doing this last minute.

2024 Contribution Limit:

• Up to 25% of net self-employment income

• Max $69,000

Deadline:

• Can be set up AND funded until tax filing deadline (April 15, 2025 or October 15 with extension)

Action Items:

• Calculate maximum contribution you can afford

• Set up Solo 401(k) if you don’t have one (can be done in days)

• Make employee contribution before Dec 31, 2024

• Plan employer contribution for when you file taxes

4. MAXIMIZE QUALIFIED BUSINESS INCOME (QBI) DEDUCTION

What It Is:

The QBI deduction lets eligible business owners deduct up to 20% of qualified business income.

Example:

• Net business profit: $100,000

• QBI deduction: $20,000 (20%)

• Taxable income: $80,000

• Tax savings (25% bracket): $5,000

How to Maximize It:

Strategy 1: Pay Yourself W-2 Wages (If S-Corp)

QBI deduction phases out if you don’t pay yourself reasonable W-2 wages. Make sure your payroll is processed before year-end.

Strategy 2: Buy Qualified Property

Purchasing business property (equipment, vehicles, etc.) can increase your QBI deduction in some scenarios.

Strategy 3: Time Income

If you’re near the phase-out threshold ($191,950 single, $383,900 married), delaying invoices until January 2025 might keep you under the limit.

Action Items:

• Calculate your projected 2024 taxable income

• Check if you’re near phase-out thresholds

• Consider timing of income and deductions strategically

• Consult with your CPA (this one gets complex)

5. MAXIMIZE VEHICLE DEDUCTIONS

Option 1: Standard Mileage Rate

• 2024 rate: 67 cents per mile

• Track all business miles

• Simple, but limited

Option 2: Actual Expense Method

• Deduct actual costs (gas, insurance, repairs, depreciation)

• Requires detailed record-keeping

• Usually better for expensive vehicles

Option 3: Section 179 for Heavy Vehicles

• Vehicles over 6,000 lbs qualify

• Deduct full purchase price (up to $30,500 for some SUVs)

• Must be used >50% for business

Last-Minute Action:

If you need a business vehicle:

• Buy before Dec 31, 2024

• Over 6,000 lbs = bigger deduction

• Document business use percentage

• Take delivery AND use it for business before year-end

If you’re using standard mileage:

• Export your mileage log from apps (MileIQ, Everlance)

• Ensure you tracked the full year

• Reconstruct missing months using calendar/receipts

6. HIRE YOUR CHILDREN (One Last Paycheck)

If you haven’t started this strategy yet:

You can still hire your kids and pay them for work done in 2024.

December Action:

• Write job descriptions

• Create timesheets for October-December work

• Issue paychecks before December 31

• File W-2 by end of January 2025

If they’ve been working all year:

Make sure they’ve received all paychecks. Don’t wait until January to pay November-December wages.

Maximum Impact:

• Pay up to $13,850 (2024 standard deduction)

• They pay $0 in federal tax

• You deduct the full amount

7. DONATE BUSINESS ASSETS

What You Can Donate:

• Old equipment

• Computers and technology

• Furniture

• Inventory (special rules)

• Vehicles

Deduction:

Fair market value (what it’s worth now, not what you paid)

Example:

• Old computer you paid $2,000 for in 2020

• Fair market value now: $300

• Donate to qualifying nonprofit

• Deduct $300

Requirements:

• Must donate to qualified 501(c)(3) organization

• Get written acknowledgment for donations over $250

• Get appraisal for non-cash donations over $5,000

• Must be donated by December 31, 2024

Strategic Play:

Donating inventory can be especially valuable for product-based businesses. Clears out old stock, gets a deduction, and helps a good cause.

8. PAY BONUSES TO EMPLOYEES (Including Yourself if S-Corp)

W-2 Employees:

Pay bonuses before Dec 31, 2024 = deductible in 2024

Yourself (if S-Corp):

Pay yourself an extra W-2 paycheck before year-end to:

• Reduce business profit

• Meet “reasonable compensation” requirements

• Avoid IRS scrutiny on QBI deduction

1099 Contractors:

You have until tax filing deadline to pay, but paying in 2024 gives you the deduction sooner.

Action Items:

• Review year-end budget

• Determine bonus amounts

• Process payroll before December 31

• Issue W-2s by January 31, 2025

9. WRITE OFF BAD DEBTS

If customers owe you money and aren’t paying:

You can write off bad debts if:

• You’ve made reasonable collection attempts

• The debt is legitimately uncollectible

• You use accrual accounting (if cash basis, you never counted it as income anyway)

Action Items:

• Review accounts receivable

• Document collection attempts

• Write off uncollectible debts before Dec 31

• Send final demand letters

This reduces your taxable income for 2024.

10. BUNCH DEDUCTIONS (Tax Planning for 2025)

If you expect higher income in 2025, consider DELAYING deductions until next year.

Counterintuitive, but strategic:

Example Scenario:

• 2024 income: $80,000 (22% tax bracket)

• 2025 projected income: $200,000 (32% tax bracket)

Strategy:

Don’t prepay 2025 expenses in December 2024. Wait and deduct them in 2025 when you’re in a higher bracket.

Same $10,000 deduction:

• In 22% bracket: Saves $2,200

• In 32% bracket: Saves $3,200

Wait for the bigger benefit.

11. REVIEW YOUR ENTITY STRUCTURE

If you’re operating as a sole proprietor and made $50K+:

Consider electing S-Corp status for 2024 (must do before March 15, 2025 for 2024, but plan now).

Why:

• Sole prop: Pay 15.3% self-employment tax on all profit

• S-Corp: Pay self-employment tax only on W-2 wages, not distributions

Example:

• Profit: $100,000

• Sole prop self-employment tax: $15,300

• S-Corp (with $60K salary, $40K distribution): $9,180

• Savings: $6,120

Action Items:

• Schedule consultation with CPA before December 31

• Discuss if S-Corp makes sense

• Understand the requirements and paperwork

• Make election by March 15, 2025 for 2024 (or Oct 15 with extension)

12. CLEAN UP YOUR BOOKS

Before year-end, make sure:

✅ All business expenses are properly categorized✅ Personal expenses are removed from business accounts✅ Receipts are organized and backed up✅ Mileage logs are complete✅ Home office percentage is calculated (if applicable)✅ Inventory is counted (if product-based business)✅ Accounts receivable and payable are accurate✅ Bank accounts are reconciled through December

Why this matters:

Clean books = accurate deductions = maximum tax savings = faster tax prep = smaller CPA bill

13. HOME OFFICE DEDUCTION (Calculate and Document)

If you work from home:

Simplified Method:

• $5 per square foot

• Max 300 square feet

• Max deduction: $1,500

Actual Expense Method:

• Calculate percentage of home used for business

• Deduct that percentage of:

• Mortgage interest or rent

• Utilities

• Insurance

• Repairs

• Depreciation

Requirements:

• Space used EXCLUSIVELY and REGULARLY for business

• Principal place of business

Action Items:

• Measure your office space

• Take photos (for records)

• Calculate total home square footage

• Determine which method saves more

• Gather utility bills and mortgage statements

14. MAXIMIZE HEALTH INSURANCE DEDUCTIONS

Self-Employed Health Insurance Deduction:

If you’re self-employed and pay your own health insurance:

• Deduct 100% of premiums

• Covers you, spouse, and dependents

• Above-the-line deduction (don’t need to itemize)

Requirements:

• Must be self-employed (not eligible if you can get employer coverage through spouse)

• Business must show profit

Action Items:

• Total all health insurance premiums paid in 2024

• Include dental and vision

• Include long-term care insurance (with limits)

• Deduct on Form 1040, line 17

15. MAKE ESTIMATED TAX PAYMENT FOR Q4

Final Q4 estimated tax payment due: January 15, 2025

But you can pay it in December 2024 to:

• Get it done and not worry about it

• Avoid the last-minute stress

• Ensure you’re not underpaid (and avoid penalties)

Calculate:

Total tax you expect to owe for 2024Minus what you’ve already paid (quarterly estimates + withholding)= What you need to pay by Jan 15

Pay early if:

• You want to avoid penalties

• You had a high-income year

• You want it done before year-end

YEAR-END TAX CHECKLIST

By December 20:

☐ Calculate projected 2024 taxable income☐ Identify all possible deductions☐ Review equipment/vehicle needs☐ Check retirement contribution limits☐ Organize receipts and records

By December 31:

☐ Purchase qualifying equipment (Section 179)☐ Prepay Q1 2025 expenses☐ Make retirement contributions (employee portion)☐ Pay employee bonuses☐ Pay final paycheck to children☐ Make charitable donations☐ Write off bad debts☐ Process final payroll☐ Reconcile all bank accounts☐ Document home office use☐ Complete mileage logs

By January 15, 2025:

☐ Make Q4 estimated tax payment☐ Schedule tax prep appointment

By April 15, 2025:

☐ File tax return☐ Make employer retirement contributions (Solo 401k)☐ Pay any remaining tax due

The Biggest Mistake

Waiting until April to think about taxes.

By then, 2024 is closed. You can’t go back and:

• Buy equipment

• Prepay expenses

• Set up retirement accounts

• Hire your kids

• Make charitable donations

All of these strategies require ACTION before December 31, 2024.

How Much Can You Save?

Conservative Example ($75K net profit):

• Section 179 equipment: $20,000 = $5,000 saved

• Prepaid expenses: $10,000 = $2,500 saved

• Solo 401(k): $30,000 = $7,500 saved

• Home office: $5,000 = $1,250 saved

• Total: $16,250 in tax savings

Aggressive Example ($150K net profit):

• Section 179 equipment: $50,000 = $12,500 saved

• Prepaid expenses: $15,000 = $3,750 saved

• Solo 401(k): $69,000 = $17,250 saved

• Child wages: $13,850 = $3,462 saved

• Home office: $8,000 = $2,000 saved

• Total: $38,962 in tax savings

These aren’t hypothetical. These are real numbers business owners achieve every year.

Need help implementing these strategies? Our tax strategy webinar walks through each tactic with real examples and implementation plans.

[Register for Free Tax Webinar →]

You have 22 days. Let’s make them count. 🎯