Most small business owners think of tax season as something that happens in the first few months of the year. The planning that actually shapes that outcome, though, happens in the fall.
October is when the most meaningful year-end decisions still have time to be implemented well. By December, some of those options are no longer available, and the ones that remain are harder to execute thoughtfully. By April, there is nothing left to do but report on what already happened.
At Dunn CPA Firm, year-end tax planning conversations with clients typically start now, and for good reason.
What Is Still Available to You Before December 31
A few areas are worth reviewing carefully before the year closes.
Equipment and asset purchases. The Section 179 expensing limit for 2026 is $2.56 million, with phase-outs beginning at $4.09 million. Combined with the permanent restoration of 100% bonus depreciation under the OBBBA, businesses can immediately deduct the full cost of most qualified equipment, vehicles, software and machinery placed in service during the year. If a significant purchase has been under consideration, the tax implications of timing it before December 31 are worth understanding now.
Retirement contributions. For small business owners, retirement accounts reduce taxable income while building long-term financial security. Contribution limits for SEP IRAs and Solo 401(k)s go up to $70,000 for 2026 depending on your situation. Reviewing where you stand now gives you time to make adjustments before year-end rather than discovering a gap at filing.
Income and expense timing. Cash-basis businesses have some flexibility in how they time income recognition and deductible expenses across the year-end boundary. Accelerating an expense into 2026 or deferring income into 2027 can affect your tax liability for the year in meaningful ways. These decisions require a clear picture of where you stand, which is easier to develop in October than in the final weeks of December.
S corporation compensation. If you operate as an S corporation, your reasonable compensation for 2026 is worth reviewing before year-end. Payroll adjustments that affect both your salary and your distributions need to be made while the year is still open.
Changes to the QBI Deduction Worth Knowing
The Qualified Business Income deduction, which allows pass-through business owners to deduct up to 20% of qualified business income, is now permanent under the OBBBA. For 2026, a new minimum deduction of $400 applies to anyone with at least $1,000 in qualified business income, even if the deduction would otherwise phase out due to income limits.
If you have not confirmed whether your current structure and income level are positioned to take full advantage of the QBI deduction, that is a useful thing to work through before the year closes.
Charitable Giving Has a New Threshold
For individuals planning to make charitable contributions before year-end, a change that took effect in 2026 is worth understanding. Under the OBBBA, only charitable donations that exceed 0.5% of adjusted gross income qualify for itemized deduction. This makes the timing and structure of charitable gifts more relevant than it has been in prior years.
For those over 73, a Qualified Charitable Distribution from an IRA remains a tax-efficient giving option, allowing contributions directly from the account without the amount counting as taxable income.
Why October Matters More Than December
The business owners who tend to feel most in control of their tax situation are generally the ones who stay engaged with their finances throughout the year and make decisions with a full picture in front of them. October provides that window in a way that December does not.
At Dunn CPA Firm, proactive planning is a regular part of how we work with clients. If you want to review where your 2026 tax position stands and identify what moves still make sense before year-end, now is a good time to start that conversation.
