Year‑End Tax Moves for Small Businesses in Washington & Oregon
As 2025 winds down, it’s time to stop and take stock. If you run a small business in Washington or Oregon, the last few weeks of the year are your best chance to clean up your books, reduce your tax bill, and set yourself up for a smoother 2026.
Don’t wait until January. By then, the door will be closed on many money-saving moves.
This guide walks you through the year-end steps that matter most — whether you’re a solo freelancer in Vancouver or a 10-person team in Portland.
1. Review Your Financials Now
Before you make any tax decisions, take a hard look at your current numbers.
Focus on:
- Profit and loss statement — Are revenues up or down compared to last year? Did anything unusual happen?
- Outstanding invoices — Follow up on unpaid invoices now while there’s still time to collect.
- Expenses — Make sure you’ve recorded everything, especially recurring costs like software, mileage, or subscriptions.
- Estimated taxes — Check if you’re on track or might owe more than expected.
If your books are behind, now’s the time to catch up. You’ll need clean records before year-end to make good decisions.
2. Lock In Deductions Before December 31
Some tax deductions only count if you pay them this year. If your income is higher than usual and you want to reduce your 2025 tax bill, consider these:
💡 Year-End Expenses That May Lower Your Taxes:
| Expense Type | Description |
|---|---|
| Office equipment | Computers, printers, monitors — deductible under Section 179 or bonus depreciation. |
| Software subscriptions | Renew or prepay for 2026 now (QuickBooks, Adobe, CRM tools). |
| Professional fees | Pay your accountant, bookkeeper, or legal fees before Dec 31. |
| Training & development | Online courses, certifications, or industry webinars. |
| Home office expenses | Internet, electricity, repairs — if you qualify. |
Spending just to get deductions isn’t wise. But if you planned to make a purchase anyway, doing it now could help. Consult your Accountant or Tax Professional before making big decisions or large purchases
3. Consider Entity and Tax Planning Moves
Your business structure can affect your taxes more than you might think.
- Still a sole proprietor? Now’s the time to talk with an accountant about switching to an S-Corp for 2026.
- Already an S-Corp? Consider paying yourself a year-end bonus or adjusting your salary to stay compliant with IRS “reasonable compensation” rules.
- Thinking of retirement? You can contribute to a SEP IRA or Solo 401(k). These reduce your taxable income. You can fund them later, but often must set up the plan by December 31.
Every business is different. A quick meeting with a tax pro now can help you avoid surprises later. Schedule a Tax Planning appointment with Northwest Accounting & Tax Service to discuss your options and the tax implications of each entity type.
4. Prep for Payroll and Sales Tax Reporting
If you run payroll in Washington or Oregon, you’ve got extra year-end tasks to stay clean and compliant.
- Reconcile payroll — Make sure employee pay, taxes withheld, and benefits are accurate before filing W-2s and 1099s.
- WA-specific reporting — Review requirements for the WA Cares Fund and Paid Family and Medical Leave.
- OR-specific reporting — Confirm you’ve handled the Corporate Activity Tax (CAT) properly.
- Sales tax filings — If you collect sales tax in WA, check that your filings are up to date before the year closes.
Important: We don’t suggest making any payroll or tax adjustments without first speaking with your accountant or tax advisor. These changes can have long-term impacts.
Call us to schedule a tax planning appointment with Northwest Accounting & Tax Service. We’ll help you wrap up 2025 correctly and start 2026 on solid ground.
5. Prepare for a Clean Start in 2026
Even if 2025 didn’t go how you planned, you can start 2026 on better footing. Here’s how:
Get Ready for Next Year:
- Back up your books — digitally and securely.
- Review your budget — compare actuals to planned and make a realistic 2026 forecast.
- Set calendar reminders — estimated tax payments, license renewals, filing deadlines.
- Review pricing and contracts — factor in inflation, cost increases, or scope changes.
- Clean up inactive clients or vendors in your system.
✅ Year-End Tax Checklist for Small Businesses
| Task | Deadline |
|---|---|
| Reconcile books (income + expenses) | Dec 15–20 |
| Pay final 2025 business expenses | Dec 31 |
| Send 1099s to contractors | Jan 31, 2026 |
| Final estimated tax payment (Q4) | Jan 15, 2026 |
| Set up SEP IRA or Solo 401(k) plan | Dec 31 |
| Review payroll reports for W-2 accuracy | Jan 15, 2026 |
| File WA/OR state business renewals | Jan 1–31 |
| Meet with accountant to plan for 2026 | Before January |
🧾 How NW Accounting Can Help
We work with local small businesses across Clark County and the Portland metro area — helping owners like you stay organized, compliant, and tax-ready. We know the Washington–Oregon border tax issues inside and out.
Need help reviewing your books or planning year-end tax moves?
Call us to schedule a tax planning appointment with Northwest Accounting & Tax Service before December fills up.
👋 Final Thought
Every small business can benefit from a year-end review. Whether you’re looking to lower your tax bill, tidy up your books, or plan for growth in 2026, the time to act is now — not in April when it’s too late.
Reach out if you’d like help finishing strong.