10 Legal Tax Strategies to Use Before December 31st (CPA Explained)
Use these 10 legitimate year‑end tax moves before December 31 to keep more of what you earn—plus exactly what proof to keep so the IRS stays happy.
Most owners leave thousands on the table because they don’t know what to track—or how.
Below are 10 legitimate, year‑end tax moves you can review with your CPA before December 31. Each section shows what it is, who qualifies, what proof to keep, and a 30‑second action you can take this week.
The quick take
- Do it by Dec 31: If you’re cash‑basis and want the deduction this year, get expenses documented and paid by year‑end.
- Prove it: Keep receipts, statements, and a short note on business purpose.
- Make it repeatable: Add missing categories to your chart of accounts and a simple reimbursement policy.
Need deadlines or quarterly estimate help? Use our Tax Playbook & Estimator.
1) Accountable Plan Reimbursements
Home office, cell, internet, mileage
What it is: A written policy to reimburse out‑of‑pocket business costs so the company deducts them and you don’t pick up income.
Who it helps: S‑Corp owners, partners, and key staff with mixed personal/business expenses.
Proof to keep: Home‑office square footage calc, utility bills, cell/internet statements, mileage logs.
30‑second action: Add an “Accountable Plan” policy and a simple monthly reimbursement form; pay as non‑taxable expense reimbursement (or via payroll marked non‑taxable).
Year‑end move: Reimburse December expenses before 12/31 if cash‑basis.
2) De Minimis Safe Harbor (the $2,500 rule)
What it is: An annual election to expense many tangible items up to $2,500 per invoice/item (or $5,000 with applicable audited financial statements) instead of capitalizing.
Who it helps: Anyone buying smaller gear—laptops, cameras, tools, shop equipment.
Proof to keep: Invoices showing per‑item cost at/under the threshold; chart‑of‑accounts mapping to expense.
30‑second action: Ask your CPA to attach the de minimis safe harbor election to your return and code qualifying purchases to expense (not fixed assets).
Year‑end move: Make qualifying purchases and pay by 12/31 if cash‑basis.
3) Software & SaaS Implementation Costs
What it is: Beyond the subscription, many implementation/migration/integration fees are currently deductible (facts matter).
Who it helps: Teams adopting CRMs, ERPs, phone systems, payments, scheduling.
Proof to keep: SOWs, invoices, proof of payment, go‑live notes.
30‑second action: Add a “Software Setup / Onboarding” expense category so costs don’t vanish into “Misc.”
Year‑end move: Collect vendor invoices and pay by 12/31 (cash‑basis).
4) Merchant & Financing Fees
(They add up fast)
What it is: Processor fees (Stripe/Square/Housecall Pro), merchant discount fees, and certain financing/loan fees (some amortize).
Who it helps: Anyone taking cards or using lines of credit/loans.
Proof to keep: Monthly processor statements; loan docs for points/origination fees.
30‑second action: Download YTD fee reports and book them month‑by‑month; set a recurring calendar reminder for statements.
Year‑end move: Reconcile and record all 12 months.
5) Education That Improves Your Current Business
What it is: Deduct courses, conferences, and certifications that maintain or improve skills for your existing business (not a new trade).
Who it helps: Owners and staff upskilling for current roles.
Proof to keep: Agenda, receipt, travel details where applicable, brief purpose note.
30‑second action: Create a “Professional Education” category; require a 1‑page takeaway upload from attendees.
6) Health Reimbursements for Small Teams
QSEHRA / ICHRA
What it is: Structured health reimbursements that can be more affordable than group plans and tax‑efficient when set up correctly.
Who it helps: Small employers (QSEHRA is typically for employers with fewer than 50 FTE and no group plan). ICHRA can fit broader cases with employee‑class rules.
Proof to keep: Plan documents, required notices, payroll records.
30‑second action: Ask your broker/PEO about QSEHRA/ICHRA and implementation timing; run reimbursements properly through payroll.
Year‑end move: If targeting a Jan 1 start, finalize plan docs now.
7) Advertising vs. “Charity”
Sponsor, don’t donate
What it is: A sponsorship with promotional benefits (logo, link, shout‑out) is typically an advertising deduction; a pure donation may be limited.
Who it helps: Anyone supporting local teams, events, associations.
Proof to keep: Sponsorship agreement/invoice showing the promotional benefits.
30‑second action: Ask the organization to spell out ad benefits in writing; code to Advertising, not Donations.
8) Meals That Are Actually 100% Deductible
What it is: While most business meals are 50%, certain employee‑wide social events (e.g., an annual party) can be 100% deductible.
Who it helps: Employers hosting occasional staff gatherings.
Proof to keep: Receipt, attendee list, and purpose (“Quarterly team event”).
30‑second action: Use separate categories: “Team Events (100%)” vs. “Business Meals (50%)” and note the purpose in your records.
Year‑end move: If hosting a team event, schedule and pay before 12/31.
9) Start‑Up & Organizational Costs
What it is: New businesses can deduct a portion of qualified start‑up and organizational costs in year one and amortize the rest.
Who it helps: First‑year entities or new lines of business.
Proof to keep: Pre‑opening legal fees, website/branding, training, travel related to launching, state filings.
30‑second action: Tag pre‑opening spend as “Start‑Up” so your CPA can optimize immediate vs. amortized deductions.
10) The “Augusta Rule” (280A(g))
What it is: Rent your home to your business for legitimate meetings up to 14 days/year; the business deducts rent, and you generally don’t report the income.
Who it helps: Owners hosting board/strategy/client meetings at home.
Proof to keep: Agenda/minutes, fair‑market rent comps, invoice from you to the business, and payment trail.
30‑second action: Write a simple meeting policy, pick dates, create an invoice, and pay from business to personal.
Year‑end move: Hold and pay for meetings by 12/31 (cash‑basis).
Bonus: Repairs vs. Improvements (and routine maintenance)
What it is: Repairs/maintenance keep assets in working order (often deductible now). Improvements add value/extend life (capitalize). A routine‑maintenance safe harbor may apply when work is expected more than once during the asset’s life.
Proof to keep: Invoices describing the work accurately.
30‑second action: Ask vendors to label work “repair/maintenance” when accurate (not “renovation”), and file invoices by asset/location.
Make it automatic (so you don’t miss these)
- Add missing COA categories: Accountable Plan, De Minimis, Software Setup, Merchant Fees, Professional Education, Sponsorships, Team Events, Start‑Up.
- Monthly close by the 15th; save statements and confirmations to a “Tax” folder.
- Keep a one‑page policy for reimbursements and Augusta meetings.
- Quarterly review with your CPA to tune what’s working.
Tools & downloads
- Overlooked Deductions Checklist — track each item above and the proof you need.
- Accountable Plan (plug‑and‑play template) — adopt, reimburse, and document quickly.
- Deadlines & estimates: Tax Playbook & Estimator
Don’t see these in your resources yet? Ask our team and we’ll send the latest links.
What to do next
Simple start: Add the categories above and complete one reimbursement this week under an Accountable Plan.
Next step: Review your expenses for the last 90 days and recode anything that belongs in Software Setup, Merchant Fees, or Sponsorships.
Full service: with HavenStone. We’ll review your books, map year‑end actions, and estimate the savings.
Compliance note: This article is educational, not tax advice. Rules can vary by state and facts. Work with your CPA.