Year-End Tax Planning Checklist for Montana Business Owners
By April, your tax outcome is locked in. Real tax planning happens in October, November, and December — while you can still change the numbers. Here's the checklist.
Retirement plan contributions
Solo 401(k): must be established by December 31 to contribute for the year. 2026 limits: $23,000 employee deferral + up to 25% of comp as employer contribution, capped at ~$69,000 total.
SEP IRA: can be established up to the tax return due date (including extensions). Up to 25% of comp, capped at ~$69,000.
SIMPLE IRA: must be established by October 1 for the current year.
Traditional and Roth IRAs: contribute by April 15 of the following year.
Section 179 and bonus depreciation
Equipment, vehicles over 6,000 lbs GVW, and certain building improvements can be expensed immediately if placed in service by December 31.
Bonus depreciation is 40% for 2025 property (phasing down from 100%). Section 179 has a $1.16M cap for 2024, adjusted annually.
The 'placed in service' date matters — the asset must be ready and available for use by year-end, not just ordered.
Timing income and expenses (cash basis)
Delay year-end billing to push income into next year. Accelerate year-end bill payments to pull deductions into this year.
Reverse the strategy if you expect to be in a higher bracket next year.
Distributions and salary check-in
S-corp owners: verify your W-2 reasonable comp for the year is reasonable relative to profits. Run a supplemental payroll before December 31 if needed.
LLC owners: track owner draws vs guaranteed payments correctly.
Charitable giving
Cash gifts to qualified public charities are deductible up to 60% of AGI. Appreciated stock held over a year is deductible at fair market value up to 30% of AGI — and you avoid the capital gain.
Donor-advised funds let you 'bunch' multiple years of giving into one year for a bigger itemized deduction.
Estimated tax check-in
Project your full-year taxable income and tax liability. If you're underpaid, make a Q4 estimated payment by January 15 to reduce the underpayment penalty.
This is also when to decide whether to increase W-2 withholding on your final paycheck — withholding is treated as paid evenly through the year, which can retroactively cure underpayment penalties.
A quick disclaimer
This article is general information for Montana small business owners, not tax, legal, or accounting advice for your specific situation. Rules change, and how they apply depends on facts we don't know about you. Before acting on anything you read here, talk to a qualified professional. If you're a Montana business owner and want a real conversation about your books, payroll, or tax, that's what Marlow Accounting is here for — call 406-290-1214 or schedule a discovery call.