Business Tax Tips: Year-End Tax Housekeeping

As we get close to the end of 2025, at Gray & Forester we recommend to our clients that it is a great time to do some year-end tax housekeeping to make sure you aren’t surprised when it comes time to file. For the 2025 filing year, there are a number of tax changes enacted due to the One Big Beautiful Bill (OBBB) that could have an impact on your tax situation. Contact us or reach out to your tax professional to determine how this impacts you. Taking full advantage of tax law is good way of saving money and building wealth for you, your family, or your small business.

This year, we are expanding our business and taking on a limited number of new tax clients. We anticipate these spaces to fill quickly. We strongly suggest you reach out to us ASAP if you are interested in having Gray & Forester prepare your 2025 taxes.

Below are some key tax tips for businesses to consider for 2025 as well as some tax savings ideas you may want to consider before the year ends. If you have questions, or want to discuss your situation, please feel free to contact us.

 Small Business Taxes – Things to Consider

• Section 179 – Allows immediate deduction of qualifying personal property for a business (e.g. equipment, software, vehicles). Max deduction is $1,250,000 but phases out and cannot create a NOL (Net Operating Loss).
• Bonus Depreciation – Allows immediate deduction of up to 100% of qualifying cost of an asset, can create a NOL (Net Operating Loss), and applies to new or used property purchased by a business.
• As with all things related to the IRS, there are a number of exceptions and restrictions, so please reach out to us to see how this will impact your unique financial situation.

• Allows eligible taxpayers to deduct up to 20% of qualified business income for pass through entities (Sole Proprietorship, Partnership, S Corp, Certain trusts & estates).
• Limited to 20% of taxable income less any net capital gains.
• Deduction starts to phase out if total income is $191,950 (single), $383,900 (MFJ).
• Deduction limit is lesser of 20% of QBI, 20% of taxable income (minus net capital gains)
• Wage/Property limitation (if above threshold)
• Reach out to us to see how we can help you optimize this strategy.

• Instead of paying state income tax personally (which will be capped at $40K for 2025 return filed in 2026 federally under the OBBB), you elect to have your business pay the tax at the entity level. This shifts the tax deduction onto the business return, where it’s fully deductible federally—and then credited back to you on your state return (most states, but not all allow for the Pass Through Entity Tax workaround).
• The business must be organized as a pass-through entity (S Corp, Partnership, or LLC taxed as such. Sole proprietorships do not qualify).

• Consider establishing a tax advantaged retirement plan for you and your employees. Solo 401K’s, SEP IRA’s, and Simple IRA’s are sound options that give unique tax advantages.