Maximize 2025 Tax Savings: 5 Pro Moves Before Year-End
As 2025 winds down, it is prime time for strategic tax moves, especially with the sweeping changes introduced by the One Big Beautiful Bill Act (OBBBA) signed into law on July 4, 2025. Below are five timely strategies designed for taxpayers who want to maximize deductions and minimize liabilities before the year closes.
1. Quarter and Year-End Income Timing
With the OBBBA making the higher standard deduction and the 2017-style tax brackets permanent, tax forecasting before year-end is more important than ever. For 2025, the standard deduction is $31,500 for married couples filing jointly. Strategic planning can help determine whether to accelerate deductions into 2025 or defer income into 2026 depending on your projected bracket.
IRS inflation-adjusted tax items for 2025
H.R.1 One Big Beautiful Bill Act (Public Law 119-21)
2. Real Estate Investors: Cost Segregation and 1031 Exchanges
The OBBBA permanently extended both Section 179 expensing and bonus depreciation. Real estate investors can capture large deductions through cost segregation studies that reclassify assets into shorter recovery periods. In addition, a properly structured 1031 exchange can still defer capital gains on real property sales. Taken together, these tools can significantly lower taxable income for 2025.
Cost Segregation Audit Techniques Guide
Like-kind exchanges real estate tax tips
BDO: Permanent 100% bonus depreciation and increased Section 179 limits
3. Retirement Planning for High Earners and Seniors
Retirement planning remains one of the most powerful tax-saving opportunities. High earners can take advantage of larger contribution limits through employer-sponsored plans, while seniors benefit from a new temporary provision under OBBBA.
Seniors age 65 and older may claim an additional $6,000 deduction for 2025 through 2028. This benefit phases out at $75,000 of income for individuals and $150,000 for joint filers. For those above these thresholds, maximizing retirement plan contributions such as 401(k)s, defined benefit cash balance plans, or SEP IRAs provides substantial deferral opportunities.
OBBBA provisions summary on IRS.gov
OBBBA fact sheet for working Americans and seniors
4. S-Corp Owners: High-Impact Tax Planning for 2025
High-income S-Corp owners, especially those earning more than $200,000, should carefully evaluate their compensation and benefit structures before December 31.
Review Reasonable Compensation
The IRS continues to enforce reasonable compensation requirements for shareholder-employees. A salary that is consistent with industry standards reduces audit risk and allows distributions to be taken free of payroll taxes.
IRS guidance on S Corporations
KPMG reports: Passthroughs tax provisions in “One Big Beautiful Bill Act”
Maximize Retirement Contributions
Pairing a 401(k) with a cash balance plan can create six-figure deductible contributions each year. With OBBBA making current tax brackets permanent, deferral remains a strong tool for high earners.
Combined limits when sponsoring both a 401(k) and a cash balance plan (IRC §404(a)(7))
Why cash balance plans supplement 401(k)s for higher-paid employees
Use the New Vehicle Loan Interest Deduction
OBBBA introduced a personal deduction for interest on loans for new vehicles assembled in the United States. The deduction is capped at $10,000 per year and phases out for joint incomes above $200,000. For S-Corp owners, pairing this new deduction with business-related mileage or actual expense methods can maximize both personal and corporate benefits.
IRS OBBBA provisions
IRS 2025 standard mileage rates
Leverage Fringe Benefits
Tax-advantaged fringe benefits such as HRAs, accountable plan reimbursements, and employer-provided vehicles can reduce taxable income and payroll tax exposure.
Employer’s Tax Guide to Fringe Benefits, Pub. 15-B (2025)
5. Tax Resolution and Cleanup Before the 2026 Filing Season
Withholding rules and forms remain unchanged despite the OBBBA revisions. This means year-end is the ideal time to resolve outstanding IRS notices, address prior-year filings, or prepare for audits. Cleaning up past liabilities before the new filing season creates peace of mind and allows for a proactive focus on 2026 planning.
IRS announces no changes to certain information returns or withholding for 2025 under OBBBA
Understanding your IRS notice or letter
Final Thoughts
The OBBBA has created a new baseline for tax planning that rewards proactive strategies. Whether through accelerating depreciation, optimizing S-Corp structures, or leveraging retirement contributions, now is the time to implement these moves before December 31, 2025.
I help high-income clients apply these strategies with individualized tax planning, S Corporation compensation reviews, retirement plan design, and real estate focused planning. To see everything I offer and request a consultation, visit my services page.
