2026 End-of-Year Tax Moves to Consider

The decisions you make before year-end could have a meaningful impact on your 2026 tax bill. Reviewing your tax situation now can help ensure you’re taking advantage of the opportunities available under current tax law before key deadlines pass. With a reasonable estimate of your liability, you can plan ahead, adjust in real time and avoid surprises.

While CPA Keith Klein works with his clients year-round to ensure they are ahead of the game, he uses the last few months as an opportunity to get organized and prepared for the year ahead.

“Planning ahead helps turn uncertainty into a clear strategy,” Keith says. “By reviewing a client’s tax situation and financial goals before the new year, I can identify planning opportunities and help them move forward with greater confidence.”

Now is the time to pause and review your individual situation to ensure you’ve maximized your tax planning as we approach the final months of the year.

Corporate Tax Planning Strategies

• Updated in 2026 – The 1099 limit has been increased for 2026.
  • In prior years, business owners were required to issue a 1099 to any nonemployee who earned more than $600 during the calendar year. For 2026, the threshold has increased to $2,000.
  • This will likely reduce the number of 1099s business owners will need to issue in January 2027. The deadline to issue a 1099 is Jan. 31, 2027.

• Know if your state allows a Pass-Through Entity (PTE) tax deduction.
  • Most states have state income tax that allows owners of S-Corporations or Partnerships to pay their state income tax at the entity level for the portion of their income passed through on their K-1.
  • This allows you to receive a federal tax deduction for a portion of your state taxes that would otherwise not be deductible.
  • The tax payments must be made before Dec. 31, 2026, to be deducted in 2026.

• S-Corporation QBI Limits
  • In 2025, the qualified business income (QBI) deduction was made permanent with the passing of the One Big Beautiful Bill Act (OBBB).
  • The phase out limits for QBI increased by $50,000 in 2026. Meet with your CPA to discuss whether it would benefit you to justify a change in the ratio of W-2 vs K-1 income you take from your business.

• S-Corporation Health Insurance
  • If you operate your business in an S-Corporation and pay for your health insurance through your business, you must report the premiums paid on your W-2 form.
  • While these premiums are not considered wages for employment taxes, they must be reported here to be deducted from the S-Corporation and the shareholder’s personal return.

• Consider a Defined Benefit Plan, and it’s not too late to add this plan for 2026.
  • Have you maximized your 401(k) Plan but are still looking for a way to save more in a tax-deferred environment and have excess cash flow?
  • If a cash balance plan has been on your to-do list, most advisors will generally continue to set these up if it makes long-term financial sense for the client. The original SECURE Act granted extended time, allowing set-up to roll into the new calendar year as long as it’s complete before filing your 2026 return.

• Consider accelerating expenses before year-end.
  • The tax rates are not expected to change in 2027, so the fundamental concept of accelerating expenses is still sound.
    •  A common example is accelerating supply orders you would typically pay next year before year-end.
    • Another example is pre-paying for a CE course or business trip you know is on the horizon for the year ahead.
    • This may not be the right approach for someone who expects to earn significantly more income in the following year. Consult your tax professional.

• Purchase equipment before year-end and ensure it is “placed in service” by Dec. 31, 2026.
  • If you need new equipment that will increase your ability to make more money in the future, purchase this before year-end.
    • Placed in Service is defined as when the property is ready and available for use. This includes when the equipment is held in local storage.
    • Section 179 and bonus depreciation rules allow doctors to write off substantial equipment purchases.
    • CWA advisors caution against purchasing equipment just to avoid taxes. In that case, it is more economical to just pay the taxes.
    • CWA advisors also suggest that you consider interest rates if you plan to obtain the equipment using financing.

• If planning leasehold improvements to qualified business property, ensure they are placed in service by Dec. 31, 2026.
  • A taxpayer can now claim bonus depreciation on 100% of the property’s cost basis.
  • Review with your CPA to ensure your purchases are “qualified business property.”
  • Not all states offer this tax benefit.

• Reimburse yourself for business expenses you personally paid by year-end.
  • If you have personally paid any business expenses this year, have the business reimburse you before year-end.
    • For 2026, the deduction for business meals remains at 50%.
    • Know what you can and cannot deduct from business-related travel.
    • Entertainment expenses generally are not deductible, although there are many exceptions.