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🦃 Before December 31, the IRS is quietly keeping score on your year. If you sold a business or property, had a big income jump, or moved a lot of money, that score can turn into a brutal tax bill if you wait too long to look at it. For business owners and investors coming off a big year, the difference between a planned bill and a painful surprise is what you do before December 31.
🍽️ A Thanksgiving Table, Two Very Different Futures
Picture a Thanksgiving table with three generations sitting together. Two siblings have something big in common: both sold their businesses this year. The sale price is similar. The life impact is not.
👤 One sibling assumes their accountant will take care of it in the spring. They enjoy the holiday, ignore the tax side, and get hit months later with a massive, unexpected bill.
👥 The other sibling handles it differently. Before December 31, they sit down with a tax pro, map out what the sale will trigger, and walk through options while they still have time to use them. They still pay tax, but it is a bill they chose, not a surprise that chooses them.
Same kind of deal. Very different futures.
🎯 Why Year-End Tax Planning Matters
Your tax return is a report card on choices that already happened. Once the year ends, most of those choices are locked in.
Year-end planning is about reviewing the year before the calendar closes, while you can still move numbers around. That includes questions like:
- how much income you recognize this year versus next year
- how gains and losses line up
- how your business or investment activity shows up on the return
- whether your payments match the tax that is coming
The difference usually is not a complex or exotic strategy. It is simply whether you look at the numbers in time.
🔍 Who Should Pay Close Attention This Year?
Year-end planning is especially important if your year looks different from normal. You may want a deeper review if you:
- sold a business or a major part of one
- sold a rental or investment property
- had a large one-time bonus, stock option exercise, or commission
- realized big gains in your investment or crypto portfolio
- moved significant money between accounts or entities
In years like this, the default is often a painful surprise. A calm year-end review is how you turn that surprise into a plan.
🧪 How To Pressure-Test Your Year Before December 31
You do not need a perfect or fancy plan. You need a real plan based on your actual numbers.
Here is a simple way to think about pressure-testing your year:
✅ Gather your big moves
Make a short list of the major events this year:
- business sale or partial sale
- property sale
- large distributions or payouts
- big portfolio gains
- any other unusual income
👓 Look at your full-year income picture
Do not just look at a single deal. Look at your salary, business profit, gains, and other income together so you can see the total tax impact.
💡 Ask what each move triggers
For each big event, understand what kind of tax it creates, such as capital gains or extra ordinary income, and how it stacks with everything else.
📊 Compare your payments to what is coming
Check your estimated payments and withholding against your expected tax. A gap here is often where the brutal surprise comes from.
🗓️ Review options that are still open
Before December 31, you may still have choices about timing, how you structure certain moves, or how you handle related expenses and cash flow.
The goal is not to chase every possible trick. The goal is to see your year clearly enough that you can choose your tax bill on purpose.
⏰ Why December 31 Is The Real Deadline
For many business owners and investors, April feels like the deadline. In reality, most of your important tax decisions expire on December 31.
Once the year is over:
- your income is fixed
- your gains and losses are what they are
- many planning options are gone, even if you have not filed yet
That is why waiting until tax season can be so painful. By then, you are not planning. You are only reporting.
Looking at the numbers before December 31 gives you time to adjust course while it still matters.
👔 Working With A Former IRS Auditor
Daveed Tuck, former IRS auditor and founder of Anvil Tax, spends this time of year helping clients pressure-test their year before it ends.
That work is not about fear or pressure. It is about a calm review:
- walking through what changed this year
- mapping out what those changes will mean on the tax return
- showing the range of tax outcomes that are still possible
- helping you decide which path makes the most sense for your family or business
The result is simple. You stop overpaying by accident and keep more money working for the people and causes you care about.
🧭 You Do Not Need A Perfect Plan, You Need A Real One
Many people put off year-end planning because they feel like they should have done more already. That delay often leads to even more regret when the tax bill lands.
You do not need a flawless, long-term master plan before you can take action. You need a clear, honest look at your actual year and a handful of key decisions made before December 31.
A real, simple plan you can follow beats a perfect plan that never leaves your head.
FAQ: Common Questions About Year-End Tax Planning For Big Years
Q: What is year-end tax planning?
A: Year-end tax planning is the process of reviewing your income, deals, and major money moves before December 31 to see what they will mean for your tax bill. The goal is to use the time left in the year to make informed choices, instead of finding out in tax season that you owe far more than you expected.
Q: Why is December 31 such an important date?
A: For most individuals and businesses, December 31 is the cutoff for the tax year. Once that date passes, many options to adjust income, manage gains, and shape your tax outcome are no longer available. Looking at your numbers before December 31 gives you a chance to act while you still can.
Q: Who should consider year-end tax planning?
A: Anyone whose year looks different from normal should consider it, especially if you sold a business or property, had a large income jump, or realized big investment gains. These types of events can create a much larger tax bill than you expect if you do not review them in advance.
Q: Do I need complex strategies to benefit from year-end planning?
A: Not at all. Often the difference is basic: understanding what your big moves will trigger, checking whether your payments match the likely bill, and making a few informed decisions before the year closes. You do not need every advanced strategy. You need a clear picture and simple steps that fit your situation.
Q: What happens if I ignore year-end tax planning?
A: If you ignore year-end planning in a big year, you may still get through tax season, but with more stress, less control, and a higher chance of a surprise bill. By the time you see the problem, many of the steps that could have helped are already off the table.
Next Steps
🚀 If this year includes a business sale, property sale, big investment gains, or a major income jump, now is your moment to pressure-test your plan. You do not have to do it alone.
If you want help reviewing your year so you can stop overpaying tax and keep more money working for the people and causes you care about, contact Anvil Tax to schedule a calm year-end strategy call at anviltax.com. Do it before December 31, while there is still time to act.