10 December Tax Moves Every Contractor and Self-Employed Professional Should Make Before April
My Pension Tree, LLC
6 min read • Published • Updated
Next step
Run your age-and-income number
Two inputs — your age and your compensation — give a modeled cash balance contribution for the current plan year in about a minute. It is an illustration built on stated assumptions, not a quote; the plan's actuary sets the final figure.
10 December Tax Moves Every Contractor and Self-Employed Professional Should Make Before April
Introduction
Independent contractors often juggle multiple projects, clients, and income streams — but tax planning usually gets pushed aside until it’s too late.
Here are 10 December must-dos that can reduce your tax bill dramatically.
1. Run an Income Projection Before Dec 31
Know where you’ll land so you can make informed moves.
2. Make Last-Minute Purchases Strategically
Equipment, supplies, software, and training may be deductible this year.
3. Claim Your Home Office Properly
If you use it regularly and exclusively for work, you're likely eligible.
4. Categorize Expenses You Haven’t Logged Yet
Most contractors forget to track:
- travel
- subscriptions
- marketing
- tools
- meals
- utilities allocations
5. Decide Whether You Should Elect S-Corp Status for 2025
If your net earnings exceed ~$60–80k, S-Corp may reduce self-employment tax.
6. Set Up a Solo 401k Before Year-End
This is the difference between paying taxes on $120k vs $70–80k for some contractors.
7. Fix Your Health Insurance Alignment
Make sure it's being deducted correctly based on your entity.
Next step
Run your age-and-income number
Two inputs — your age and your compensation — give a modeled cash balance contribution for the current plan year in about a minute. It is an illustration built on stated assumptions, not a quote; the plan's actuary sets the final figure.
8. Review Your Estimated Taxes
Adjust the final quarter payment if needed.
9. Reconcile Contractor Payments (1099-NEC)
Make sure you're accurately tracking pay from every client — the IRS will match it.
10. Plan Your 2025 Financial Setup
Better bookkeeping
Cleaner deductions
Correct entity
Optimized compensation
Automated savings
All start with proper planning.
Conclusion
Contractors who plan in December save significantly more by April.
A few intentional steps now = thousands saved.
Visit MyPensionTree.com to learn the strategies suited to your business.
Next step
Run your age-and-income number
Two inputs — your age and your compensation — give a modeled cash balance contribution for the current plan year in about a minute. It is an illustration built on stated assumptions, not a quote; the plan's actuary sets the final figure.