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Key Takeaways Your tax bill isn’t decided in April. It’s decided by the structures, accounts, and elections you set up while the year is still open.
Don’t treat taxes as a once-a-year chore. Treat them as an ongoing strategy, tune salary, estimates, and deductions during the year.
Most business owners think about their taxes when it is time to file. The problem is that by then, the year is already closed, the income has already been received as it was and most of the decisions that could have lowered the bill are behind you. Filing is just reporting a number that was set months earlier.
That is the part people miss. The moves that actually cut your tax bill are not things you do in April. They are things you do while the year is still in front of you, and nearly all of them have a deadline that falls before Dec. 31. Here is how I think about the year while there is still time left in 2026 to act on it.
First, the things that just need to exist
Some moves cost almost nothing today and are only there to keep your options open later. I would do these now and not think twice about it.
The first is to form an LLC and operate through it. The LLC is the most flexible entity type. On its own, it changes nothing about your taxes, but it can go anywhere from there: it can stay a disregarded entity, be taxed as a partnership or take an S-Corp or C-Corp election later.
All of those are fine, and which one is right depends on where the business goes. The part that trips people up is that neither election is its own separate entity. It is an election on a pre-existing business, and if that entity is not already in place, there is nothing to elect on. Every Q4, owners come to me having had a banner year through a sole proprietorship, and by then, the income has been received the wrong way for 11 of the 12 months.
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