2025 Year-End Tax-Saving Tips

As 2025 comes to a close, there’s still time to make meaningful moves that reduce your tax bill, strengthen retirement savings, and position you for a strong 2026. Here are the most important year-end strategies to consider before December 31.

1. Maximize Business Deductions

  • Prepay up to 12 months of expenses (rent, insurance, leases) if you’re on the cash basis.

  • Delay December billing to push income into 2026.

  • Purchase and place equipment in service before year-end to use bonus depreciation or Section 179.

  • Use business credit cards—deductions apply when charged, not when paid.

  • Claim all legitimate deductions with proper documentation.

2. Boost Retirement Contributions

  • Set up or fund a Solo 401(k) before year-end.

  • Contribution limits range from $23,500 to $34,750 depending on age, plus employer contributions.

  • Use available credits: up to $15,000 for new plan startup costs and other contribution-based credits.

  • Consider a Roth conversion in a lower-income year.

3. Take Advantage of Vehicle Deductions

  • Heavy SUVs and trucks (>6,000 lbs GVWR) may qualify for 100% bonus depreciation.

  • Lighter vehicles fall under luxury depreciation limits.

  • Must be owned and in service by December 31.

4. Manage Crypto Gains and Losses

  • Harvest gains or losses before year-end to manage tax brackets.

  • No wash-sale rules apply to crypto.

  • Donate appreciated crypto for a deduction and to avoid capital gains.

  • Gifts up to $19,000 per person require no reporting.

5. Review Existing Vehicle Opportunities

  • Selling older business vehicles can unlock deductible losses.

  • Vehicles traded pre-2018 may still have unclaimed loss deductions.

  • Converting a personal vehicle to business use may qualify for bonus depreciation.

6. Optimize Your Stock Portfolio

  • Offset gains with losses to reduce taxable income.

  • Avoid wash sales—wait 30 days before repurchasing the same stock.

  • Gift appreciated stock to family in lower tax brackets.

  • Donate appreciated shares for a fair-market-value deduction without capital gains.

7. Review Health Reimbursement Options

  • Complete Section 105 HRA reimbursements before year-end.

  • Consider QSEHRA or ICHRA for employee health benefits.

  • S-corp owners must ensure premiums are reimbursed and included on W-2s.

8. Use Family-Friendly Tax Strategies

  • Pay your under-18 child for legitimate work—wages are deductible and tax-free up to the standard deduction.

  • Factor in marriage/divorce timing for tax impact.

  • Use the 0% capital gains bracket when gifting appreciated assets to lower-income relatives.

9. Maximize the Section 199A Deduction

  • Key thresholds: $197,300 (single) and $394,600 (joint).

  • Lower taxable income through losses, donations, or asset purchases to preserve the deduction.

10. Quick Year-End Checklist

  • Prepay 2026 expenses

  • Delay late-December billing

  • Buy and place equipment/vehicles in service

  • Review crypto & stock portfolios

  • Finish HRA reimbursements

  • Pay children for business work

  • Evaluate 199A eligibility

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