A useful year-end tax planning checklist is really two lists. The first holds moves that must be finished by December 31: placing equipment in service, running final payroll, harvesting investment losses, completing Roth conversions, and making charitable gifts. The second holds moves that can wait until your filing deadline, including IRA and HSA contributions, SEP IRA funding, and certain retirement plan setups. Knowing which list a decision belongs on is what keeps November from turning into a December scramble.
Most owners and high earners know year-end planning matters. What trips them up is timing. A strategy that works on November 10 can be impossible on December 28, because the equipment cannot be delivered, a brokerage needs three weeks to move shares, or the last payroll has already run. Meanwhile, other decisions get rushed into December that could have waited for better information.
This guide sorts the common moves by deadline, explains what changed for 2026, and shows how Harness Advisory Platform approaches the final stretch of the year. The goal is a short list of decisions made on purpose, not last-minute purchases made out of panic.
2026 is the first full tax year under several provisions of the One Big Beautiful Bill Act (OBBBA). If you are planning from memory, some of last year's instincts may now point the wrong way.
Charitable giving is the clearest example. Starting in 2026, itemizers can deduct charitable gifts only to the extent they exceed 0.5% of adjusted gross income, and for taxpayers in the top 37% bracket the tax value of the deduction is capped at 35%. A household with $400,000 of AGI now gives its first $2,000 each year without a federal deduction. At the same time, people who take the standard deduction can deduct up to $1,000 of cash gifts ($2,000 for joint filers), though gifts to donor-advised funds do not count. That combination makes bunching several years of giving into one year more attractive for itemizers than it used to be.
On the business side, OBBBA made 100% bonus depreciation permanent for qualifying property acquired after January 19, 2025, and IRS Revenue Procedure 2025-32 sets the 2026 Section 179 expensing limit at $2,560,000, with the phase-out beginning at $4,090,000 of qualifying purchases. The state and local tax deduction cap for itemizers is $40,400 for 2026, with a phase-down that can reduce toward $10,000 once modified adjusted gross income passes $505,000. None of these numbers is a reason to spend money. They are reasons to model a decision first.
These moves have a hard calendar-year deadline. If they are not complete when the year ends, they generally count for next year or not at all.
Equipment and vehicles must be placed in service, not just ordered or paid for. The IRS looks at when an asset is ready and available for its intended use. A machine sitting on a loading dock on December 31 does not support a 2026 deduction, so delivery dates matter more than invoice dates.
Owner payroll for S-Corp owners needs attention before the final payroll of the year. That is where you confirm your salary is reasonable for the work you do, include any health insurance premiums the business paid for you in your W-2 wages, and set your 401(k) deferrals, which have to come out of 2026 paychecks. Once the last payroll runs, most of these levers lock.
Expense reimbursements under an accountable plan should be submitted, documented, and paid before the books close. Mileage, home office, and travel costs you paid personally are easy to capture and easy to forget.
Bonuses depend on your accounting method. A cash-basis business deducts a bonus when it is paid. Accrual-basis businesses have more flexibility for employee bonuses paid shortly after year-end, but that flexibility generally does not extend to owner-employees and related parties. Prepaid expenses are similar: some qualify for an early deduction under the IRS 12-month rule, but prepaying just to shrink this year's income can leave next year short on cash and deductions.
Tax-loss harvesting has to be executed by the last trading day of the year. Selling an investment at a loss can offset capital gains you realized earlier in the year, plus up to $3,000 of ordinary income, but the wash sale rule disallows the loss if you buy the same or a substantially identical security within 30 days before or after the sale.
Roth conversions count in the calendar year they are completed. There is no extension. If a lower-income year makes a conversion attractive, the decision and the paperwork both need to happen in 2026.
Charitable gifts, including contributions to a donor-advised fund, must be completed by December 31 to count this year. Gifts of appreciated stock take longer than expected, and many custodians set transfer cutoffs in early December.
Annual exclusion gifts to family members also run on the calendar year. For 2026 the exclusion is $19,000 per recipient, and unused exclusion does not carry forward. Required minimum distributions and qualified charitable distributions for those who are eligible are December 31 items as well.
This list matters just as much. It keeps you from forcing decisions before the numbers are final.
One caution: time to fund is not time to decide. If you want a SEP or profit-sharing contribution next spring, you need a projection now showing whether the cash will be there.
This is where a quiet but valuable planning move lives. According to IRS Publication 505, you generally avoid an underpayment penalty if your withholding and estimated payments cover at least 100% of last year's tax, or 110% if your prior-year AGI was over $150,000. Estimated payments are credited on the date you make them. Withholding from wages, however, is treated as if it were paid evenly throughout the year unless you elect otherwise.
That difference matters in November. If your payments fell short earlier, a large January estimate only helps the fourth quarter. Extra federal withholding on a December paycheck (including an S-Corp owner's own payroll) can cover the shortfall for every quarter. It is a simple fix, if someone spots it before the final payroll runs.
The following is a fictional example created to illustrate how Harness Advisory Platform would approach this situation. It is not a real client.
Kenji owns a physical therapy practice in Colorado with about $1.3 million in annual revenue. The practice is taxed as an S-Corp, and Kenji pays himself a W-2 salary of $140,000. He and his spouse also hold a taxable brokerage account and give roughly $8,000 a year to charity.
In early November, our advisory team builds a projection from his October books. Profit is well ahead of last year, a spring sale of concentrated stock created a sizable capital gain, and his estimated payments were based on last year's lower income.
The December 31 list comes together quickly. Rehab equipment planned for January is moved up, with written vendor confirmation of setup by mid-December. His 401(k) deferrals are increased on the final three payrolls to reach the annual limit. A fund in the brokerage account sitting at a loss is sold and replaced with a fund that is not substantially identical, offsetting part of the spring gain. Because the new 0.5% floor erodes the value of steady annual gifts, Kenji and his spouse contribute two years of planned giving to a donor-advised fund, using appreciated shares, with the transfer started the first week of December. Finally, rather than sending a large January estimate, the advisory team increases federal withholding on his December paychecks to close the gap for all four quarters.
Just as important is what Kenji does not decide in November. The practice's profit-sharing contribution can be funded up to its extended filing deadline, so that number waits until the books are final and the cash position is clear. His HSA contribution goes on the April calendar.
No single move here is exotic. The value comes from sorting them early enough to act on all of them.
Not in early November. There is still time to act on most of the moves above, but the window narrows every week. Any CPA firm can record history. As your tax advisory partner, we help you build a future, starting with a clear, sorted plan for the rest of this year.
Your business is your most important investment, and the last eight weeks of the year are when it is easiest to steer. Our advisory team will review your projection with you, separate real deadlines from false ones, and help you act on the decisions that matter.
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You can still place business equipment in service, adjust owner payroll and retirement deferrals, harvest investment losses, complete Roth conversions, and make charitable gifts, as long as each is finished by December 31. The earlier in November you start, the more of these remain practical. Delivery times, custodian cutoffs, and payroll schedules close options before the calendar does. A current-year projection tells you which of these moves is worth making.
IRA contributions, HSA contributions, SEP IRA funding, and employer profit-sharing contributions to an existing plan can generally wait until your filing deadline. The fourth-quarter estimated payment is due January 15, 2027. Waiting is often smart, because you can size these contributions once your books are final. You still need to plan now so the cash is there when you fund them.
Yes, the equipment generally has to be placed in service, meaning ready and available for use in your business, by December 31. Paying for it or signing a purchase order is not enough. Get written confirmation of delivery and setup dates from your vendor before you count on the deduction. If delivery slips into January, the deduction slips with it.
If you underpaid earlier in the year, increasing December withholding is often better. IRS rules treat wage withholding as paid evenly across the year, so it can cover shortfalls in earlier quarters, while an estimated payment only counts from the date you make it. S-Corp owners can do this through their own final payroll. Confirm the amount with a projection so you do not overcorrect.
For itemizers, charitable gifts are now deductible only above 0.5% of AGI, and top-bracket taxpayers see the deduction's value capped at 35%. That makes bunching several years of gifts into one year, often through a donor-advised fund, more attractive than steady annual giving. Non-itemizers can now deduct up to $1,000 of cash gifts, or $2,000 for joint filers. Confirm current-year figures before acting.
