As the end of the year approaches, strategic tax planning becomes one of the most valuable things a business can do. Whether you are a small business owner, an agricultural operator, or a nonprofit, year-end planning helps you lower your tax liability, prepare for filing season, and strengthen your financial position going into 2026.
This guide outlines everything Fresno and Central Valley organizations should prioritize before December 31, supported by guidance from the IRS.
Why Year-End Planning Matters
Tax planning should occur throughout the year, but the most important period is October through December, according to the IRS. This timeframe allows businesses and individuals to reduce taxable income, maximize deductions, prepare accurate records, avoid penalties, and improve cash flow forecasting. Good planning now prevents costly surprises later.
Review Your Financial Statements
Accurate books are the foundation of strong tax planning. The IRS recommends reconciling profit and loss reports, balance sheets, cash flow statements, and inventory records before year-end. DDC assists with year-end cleanups to ensure your numbers are complete and reliable.
Evaluate Your Taxable Income and Adjustments
Late-year adjustments can significantly impact your total tax liability. These strategies may include Section 179 asset purchases, bonus depreciation opportunities, timing of income or expenses, and evaluating necessary write-offs. All strategies must follow IRS rules and be completed before December 31.
Prepare 1099s Early
IRS Form 1099-NEC must be filed by January 31 for contractor payments. To avoid a last-minute rush, businesses should collect W-9s now, verify vendor information, and prepare their 1099 list ahead of time. DDC provides full-service 1099 preparation for Central Valley clients.
Maximize Retirement Contributions
The IRS highlights retirement contributions as one of the most effective tools for reducing taxable income. Contribution limits vary by plan, including 401(k), SEP IRA, SIMPLE IRA, and Solo 401(k). Some contributions must be made by year-end, while others may be made by the tax filing deadline, depending on the plan type.
Assess Payroll and Employee Benefits
The U.S. Department of Labor recommends reviewing payroll classification and benefits each year. Key items include confirming employee or contractor status, updating benefit details, preparing accurate W-2s, and reviewing any upcoming benefit changes. Misclassification can lead to penalties, so an annual review is essential.
Review Fixed Assets and Depreciation
Before year-end, businesses should update their fixed asset schedules, dispose of old equipment properly, and identify purchases that qualify for Section 179 or bonus depreciation. Agricultural, construction, and transportation companies often see the greatest benefit from this review.
Update Withholding and Estimated Payments
IRS Publication 505 advises reviewing estimated payments, withholding levels, and projected year-end balances. This helps prevent underpayment penalties and ensures there are no surprises during tax season.
Best CPA Firm for Business Taxes in Fresno
Year-end tax planning is one of the strongest tools a business can use to prepare for a new financial year. By reviewing your books, updating records, maximizing deductions, and planning, you can position your organization for stability and growth. Whether you operate a small business, manage a nonprofit, or run a large operation in the Central Valley, taking action now ensures you enter 2026 with a clear plan and fewer surprises. DDC is here to guide you through every step and help you make informed decisions that support your long-term goals.
Prepare early and stay ahead of tax season. Contact DeMera DeMera Cameron to schedule your Year-End Tax Planning appointment.