2025 Mid-Year Tax Planning

As we pass the halfway mark in 2025, it’s a smart time for business owners to pause and reevaluate their tax planning strategies. Proactive planning now can help minimize surprises come tax season and give you a clearer picture of your year-end financial position. Here are a few mid-year tax planning tips to help you stay ahead:

1. Review Your Estimated Tax Payments
Many business owners are required to make quarterly estimated tax payments. If your income has increased or decreased since the start of the year, your payment schedule may need to be adjusted. Reviewing this now helps avoid underpayment penalties or overpayments.

2. Reevaluate Business Deductions
Take a fresh look at deductible expenses like mileage, office supplies, software subscriptions, and business meals. Ensure your records are up to date and well-documented. Now is also a good time to consider any upcoming investments in equipment or services that could qualify for deductions.

3. Assess Retirement Contributions
If you offer retirement plans for yourself or your employees, mid-year is a great time to review your contribution levels. Increasing contributions to SEP IRAs, SIMPLE IRAs, or 401(k)s not only benefits employees but can also reduce your business’s taxable income.

4. Review Your Payroll Tax Compliance
Confirm that you’re withholding and depositing payroll taxes accurately and on time. Check that you’re properly classifying workers as employees or independent contractors to avoid costly penalties.

5. Meet With Your Tax Advisor
A mid-year check-in with your accountant can provide valuable insights, especially if there have been changes in your business structure, income, or goals. We can help project your year-end tax liability and identify opportunities to save.

Final Thoughts
Tax planning isn’t just a year-end activity. Taking a proactive, mid-year approach ensures you’re on track and gives you the flexibility to make smart financial decisions before it’s too late.

If you’d like to schedule a tax planning consultation, contact us today. At Momentum, we’re here to help you navigate tax season with confidence.