Don’t panic—these smart moves can help cut your taxes before the deadline.
As the end of the tax year approaches, many business owners and freelancers are scrambling to find ways to legally reduce their tax bills. The good news? It’s not too late. Even if you’ve waited until the last minute, there are still several tax planning strategies you can use to lower your tax liability and stay compliant.
At TaxMagic, we help individuals and small businesses across the U.S. take advantage of powerful, last-minute tax-saving moves—backed by the latest updates from the IRS and tailored to your unique situation.
1. Accelerate Deductions Before Year-End
If you’re on a cash-basis accounting system, you can deduct expenses when they’re paid, not when they’re billed. That means you can prepay for things like rent, insurance, or software subscriptions and deduct those costs this year.
Pro Tip: Reduce your taxable income right away by paying off business expenses before December 31.
2. Delay Income Until January
If possible, defer income that you haven’t yet received. For instance, if you’re about to issue an invoice, wait until January 1st so that it doesn’t count toward this year’s income.
This helps reduce your total taxable income for 2025, especially if you’re near a higher tax bracket threshold.
3. Max Out Your Retirement Contributions
Contributing to retirement accounts like a SEP IRA, Solo 401(k), or Traditional IRA can drastically reduce your taxable income. Even better, some of these contributions can be made after the new year but still count for the current tax year.
Use TaxMagic to calculate exactly how much you can still contribute based on your earnings.
4. Purchase Equipment or Supplies Now
You can write off the entire cost of qualifying software or equipment in the year that you buy it because of Section 179 and bonus depreciation. This includes laptops, office chairs, business phones—even machinery if you’re in construction or production.
5. Donate to a Qualified Charity
Charitable donations not only make a difference—they reduce your taxes too. Just be sure to donate to a 501(c)(3) organization and keep receipts or confirmation letters for proof. In 2025, the IRS allows for cash donations up to 60% of your AGI to be deducted (as long as you itemize).
6. Review Your Withholding or Estimated Taxes
If you’ve had a major income shift this year, double-check your withholding or estimated payments. Underpaying can result in penalties.
Use Form 2210 or our in-house calculators at TaxMagic to see if you’re at risk.
7. Claim Any Missed Business Deductions
Many people forget that things like home office expenses, mileage, internet, and business meals are deductible if properly documented.
If you’ve been doing your own taxes without bookkeeping support, this is where TaxMagic can uncover missed deductions.
8. Offset Gains with Capital Losses
If you’ve sold any assets like crypto or stocks at a profit, you can harvest losses from underperforming assets to offset gains and reduce your tax bill.
Up to $3,000 in losses can also be applied to regular income if your losses exceed gains.
9. Make use of the Qualified Business Income (QBI) deduction.
If you’re a sole proprietor, partnership, or S-Corp owner, you may be eligible for the 20% QBI deduction—but only if your income stays below a certain threshold.
TaxMagic helps analyze whether you qualify and if last-minute changes can keep you eligible.
10. Get Professional Help Before Filing
Even if you’ve waited until the final weeks, there’s still time to get expert help. Working with a tax advisor at TaxMagic means every deduction is explored and every credit is considered before you file.
We also offer audit protection, amended returns, and state-specific guidance.
Why TaxMagic Is Your Tax Planning Partner
At TaxMagic, we don’t just file your taxes—we create smart, personalized tax strategies tailored to your situation. Whether you’re self-employed, a startup founder, or running a small team, we help you keep more of what you earn and stay IRS-compliant at every step.
With our expert team, cloud-based tools, and real-time support, you’ll never be stuck guessing about taxes again.
