The Small Business Tax Planning Checklist
Let’s get real. You started a business to build a life, not to donate profits to penalties and messy tax mistakes. The IRS does not care about your reasons, your busy season, or your “I’ll get to it later.” Taxes are pay-as-you-go, and if you do not plan, you pay extra. Here is the no-BS checklist I give owners who want fewer surprises and more cash in their pocket. It’s simple, tight, and built for action.
Why this checklist matters
Cash wins when your tax process is boring and repeatable. That means you know what to do each month, each quarter, and at year-end. You set money aside before it becomes a problem. You document once so you never scramble. Most owners do the opposite. They sprint in April, pray nothing breaks, and then repeat the same chaos next year.
We are not doing that. You will build a system you can run in 30 to 60 minutes a week. No fancy software required. Just discipline, a calendar, and a few smart decisions in the right order.
Key truth: In the United States, if no one is withholding taxes from a paycheck, you’re expected to make quarterly estimated payments. Those payments follow a specific calendar and are easy to automate if you plan for them. IRS+1
Set your tax foundation
Choose or confirm the right entity.
Sole proprietorship, partnership, S corporation, or C corporation. Your entity determines how you pay yourself, which forms you file, and which strategies matter. If you want an S corporation for this year and you qualify, the election has a deadline. It is generally due 2 months and 15 days after the start of your tax year. Calendar-year companies usually land in mid-March. IRS
Open a separate tax reserve account.
This is non-negotiable. Move a fixed percent of revenue into this account every week. Do not mingle it with operating cash. Treat it like rent. It is not optional. If you do that one move, you will sleep better and never “forget” a quarterly payment again.
Decide your owner-pay method.
Sole props and partnerships use draws and pay estimates. S corp owner-operators pay a W-2 salary that is reasonable for the role, then take distributions. C corp owners are W-2 employees of their company. Build the rule now so you are not guessing when cash hits the account.
Collect W-9s from contractors before the first payment.
You cannot file 1099s without W-9s. Make it a policy. No W-9, no pay.
The quarterly tax timeline
Know the four big dates.
Quarterly estimates for calendar-year taxpayers are typically due around April 15, June 15, September 15, and January 15 of the next year. If a date falls on a weekend or holiday, it shifts to the next business day. The IRS announces the dates and provides payment options every year. IRS+1
January 31 matters.
If you pay non-employee contractors, you must file Form 1099-NEC with the IRS and furnish copies to recipients by January 31. If you miss that, penalties show up fast. Put it on your calendar now. IRS
Build a clean monthly close
Categorize and reconcile.
Once a month, categorize every transaction, reconcile bank and credit card accounts, and attach receipts for anything that looks like travel, meals, vehicle, equipment, or software. If it is not documented, it did not happen.
Tag “capital” items.
Flag equipment, vehicles, furniture, and big tech purchases. You may expense or depreciate them. Your future self will thank you when it is time to choose Section 179 or bonus depreciation. Publication 946 is your reference for how those work. IRS
Track reimbursements with an accountable plan.
If you are reimbursing yourself for business expenses you pay personally, put an accountable plan in writing and run it the same way every month. That keeps reimbursements tax-free and audit-ready.
Dial in owner pay and payroll
Sole prop or partnership.
Use draws. Schedule a fixed draw on the 1st and 15th so your household can plan. Update your quarterly estimates based on year-to-date profit so you avoid penalties. IRS
S corporation.
If you work in the business, the IRS expects a reasonable W-2 salary before distributions. Pay yourself fairly for your role, then distribute profit in chunks, not drips. Build the habit and automate it. (If you plan to become an S corp, revisit the election deadline above.) IRS
C corporation.
You are on payroll. Dividends are a separate decision. Coordinate with your CPA to avoid double-tax surprises.
Choose retirement and benefits early
Big tax savings live in retirement plans and health benefits. Decide these in the middle of the year, not on December 29.
Solo 401(k), SEP IRA, or cash balance plan. Different plans fit different profit levels and headcounts. Run projections by Q2 so you know what to fund.
Health benefits. HSAs and certain reimbursement arrangements can shift taxes in your favor if implemented correctly.
Life and disability insurance. Think about protecting cash flow, not just plugging deductions.
Plan deductions before year-end
Section 179 vs bonus depreciation.
If you need equipment, vehicles, or tech, timing and method matter. Section 179 lets you elect to expense specific assets up to annual limits. Bonus depreciation can allow a larger write-off and may create a loss. What wins depends on your income, state rules, lender optics, and future plans. The mechanics, placed-in-service rules, vehicle caps, and listed property rules all live in Publication 946. Build the plan now so you are not panic-buying in December. IRS+1
“Placed in service” means usable now.
Ordering a piece of equipment is not enough. It must be ready and available for use by December 31 to count this year. That definition matters for vehicles and major gear. IRS
Travel, meals, and home office.
Document the who, what, where, and why for meals. Keep mileage logs if you claim vehicle costs. For home office, measure once and save the layout. Do not guess in April.
Track contractors and 1099s correctly
W-9s first.
Make a habit: ask for a completed W-9 before paying the first invoice. Save it to the vendor record.
Review totals in early January.
Run a contractor summary report by January 10. Confirm legal names, addresses, and totals. Fix errors now, not on the 30th.
File 1099-NEC by January 31.
File with the IRS and furnish contractor copies by January 31. Your future audit risk and late penalties shrink when you do this on time. IRS
Quarterly deep dives
Q1: Set the pace.
Confirm or file your S corporation election if needed. IRS
Book your payroll and accounting cadence.
Fund your tax reserve every week.
Make your first estimated payment by mid-April. IRS
Q2: Tighten the system.
Reconcile Q1 and fix any messy categories.
Price out retirement plan options.
Update estimated payments based on year-to-date profit.
Q3: Plan the finish.
Decide on capital purchases. Run a Section 179 vs bonus analysis. IRS
Check contractor W-9 coverage and fill gaps.
Book year-end travel and professional development with documentation in place.
Q4: Execute with precision.
Place assets in service before December 31 if you want the deduction this year. IRS
Make the final estimated payment in January if required.
Reconcile contractor totals and prepare your 1099s now. IRS
Common red flags to avoid
S corp owner taking big distributions with little or no W-2 wage. You are asking for attention.
No tax reserve account. If you keep “forgetting,” automate weekly transfers.
No documentation for meals or mileage. Notes and logs are your defense.
Contractor payments without W-9s. That is self-inflicted pain.
Panic buying in December. Buying gear you do not need just for a deduction is not a plan.
Commingling business and personal. Use business accounts for business. Every time.
Simple tools that make this easy
A second bank account labeled “Taxes.” Sweep a fixed percent of revenue every Friday.
Calendar reminders for the four estimate dates and January 31. Share with your bookkeeper.
Receipt capture. Phone photos saved to vendor folders beat shoeboxes.
Vendor onboarding packet. Includes W-9 request, payment terms, and how to invoice you.
Monthly close checklist. Reconcile, review, tag capital items, and document. Thirty to sixty minutes.
Action items you can do this week
Open the tax reserve account and set an automatic weekly transfer.
Add estimate and 1099 deadlines to your calendar and invite your bookkeeper and CPA. IRS+1
Write your Owner Pay Policy. One page. No fluff.
Create a vendor onboarding SOP with W-9 required before first payment.
Schedule a Q2 call to decide your retirement plan.
Take photos of receipts as you spend. Attach to transactions once a week.
List any expected equipment purchases and talk Section 179 vs bonus with your CPA before October. IRS
Copy-paste monthly checklist
Reconcile all bank and credit card accounts
Categorize every transaction
Attach receipts to travel, meals, vehicle, equipment, and software
Tag capital items for 179 or bonus review
Update year-to-date profit and adjust estimate plan
Run vendor report, collect missing W-9s
Save a one-page snapshot of cash, AR, AP, and taxes reserved
Resource links
IRS Estimated Tax: due dates, who must pay, and options. IRS+1
IRS 1099-NEC and information returns: January 31 filing and furnish deadlines. IRS+1
Form 2553 S corporation election: who qualifies and when to file. IRS+1
IRS Publication 946: depreciation, Section 179, bonus, and placed-in-service rules. IRS+1
The bottom line
This is not rocket science. It is reps. You do a small set of moves every month, you automate the big dates, and you make high-leverage decisions before year-end. You document like a pro so you do not pay twice in penalties and cleanup time. If you run this checklist, your taxes get boring and your profits get louder. That is the whole point.
Ready to make this painless and permanent for your business? Book a Black Mammoth Power Hour and we will map your tax calendar, set your owner pay plan, and build your monthly close in one working session.