The Tax Questions Business Owners Should Answer Before November

By November, most owners are buried. Deals to close, year-end bills, plans for next year. Tax planning gets pushed to “after the books are closed,” and by then the options that needed some lead time are gone.

October is the best moment to stop and look. What has the business earned so far? What will it earn by the end of the year? What does that do to your taxes?



Here are six questions to answer before the quarter gets away from you.

1. What Will My Business Earn By December 31?

Your profit today isn’t where the year will finish. It’s a snapshot.

Pull your year-to-date revenue, costs, margins, and unpaid invoices. Then add what’s still coming: work already booked, seasonal swings, and any big bills before December 31. You’re after a realistic full-year number, not a guess that the last three months will look like the first nine.

This is where good tax planning starts. If you know where the year is heading in October, the conversation with your CPA is a lot more useful.

2. Are My Tax Payments Keeping Up With My Earnings?

If the business is earning more than you expected, your tax bill is probably bigger too. And if your estimated payments were set back in the spring based on an older forecast, they may be too low now.

Put your projected tax next to what you’ve already paid, including any withholding. The answer depends on your entity type, other income, deductions, credits, and the rules that apply to you. Don’t wait for the return to find out you came up short.



Ask your CPA now whether your payments need to be recalculated and what to do about the periods that are left.

3. Has My Business Changed Enough To Revisit My Tax Strategy?

If revenue has doubled, you’ve added staff, a partner has come in, or the way you operate looks different, the strategy that worked two years ago may not fit anymore.



Picture an owner who set up an entity when the company was tiny. Now it’s several times the size. Pay arrangements, ownership, and the tax effects of how the business runs today all deserve a fresh look.

What the right answer is depends on the facts. An LLC, partnership, S corporation, and C corporation are taxed differently, and switching has costs and paperwork. So the review should show whether a change would actually help before anyone files anything.

4. Are There Changes My Books Haven’t Caught Up With?

Your tax planning is only as good as your records. Expenses that never got entered, transactions in the wrong category, old inventory numbers, accounts that haven’t been reconciled: any of these can throw the picture off.

Before you make year-end decisions, check that the books match what’s really happened. Look at big transactions, owner payments, payroll, receivables, and anything you’ve been meaning to sort out.

Say a seasonal contractor finished several large jobs this summer but never reconciled the customer deposits, subcontractor invoices, and job costs. The margin on the reports might not be the real margin. Cleaning that up lets you and your CPA tell actual performance from unfinished paperwork, which matters when you’re estimating taxable income and deciding how much cash you can commit.

5. What Do I Need To Set Aside For Taxes, Payroll, And Operations?

Money in the bank isn’t money you can spend or take out. You still owe payroll, suppliers, loan payments, taxes, and the normal costs of running the place.



Build a simple cash forecast: what’s coming in, what’s going out, and when. Then hold your planned owner draws up against whatever is left.

Tax decisions can’t be made on their own. Saving on the tax bill doesn’t help if the move leaves you scrambling to make payroll. What you want to know is what the business can afford while keeping enough cash on hand to operate and grow.

6. Which Tax Planning Options Need Attention Before December?

Some moves take advance work. Others have to be completed by a certain date. If you start looking in the last week of December, there’s rarely time to weigh them properly.

Ask your CPA to go through the deductions, credits, retirement plan contributions, pay arrangements, and other options that might apply. Each one has its own rules, eligibility requirements, and timing, and each has to fit your cash and your plans.

Retirement plans are a good example. Contributions can lower your taxable income, but deadlines and requirements differ by plan type.

The goal is to find the options that really apply to you, know what needs to happen and by when, and skip the rushed purchase made only to get a deduction.

Turn The Answers Into A Year-End Plan

These six questions build on each other. Your earnings forecast feeds your tax estimate. Your books back up the forecast. Your tax position and cash needs tell you which opportunities are worth pursuing before the year ends.

To get started, gather your latest financial reports, list the big changes in the business this year, and write down the decisions you haven’t made yet. Take all of it to your CPA while there’s still time to act.

At Straight Talk CPAs, we tie business tax planning to your reporting and cash flow, so year-end decisions come from numbers you can trust.

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